From Laos to Singapore: Import of renewable energy starts

Up to 100MW of hydropower can be tapped via Thailand and Malaysia in unique scheme

Singapore yesterday began importing renewable energy from Laos via Thailand and Malaysia - a move that marks the first multilateral cross-border electricity trade involving four Asean countries and the first renewable energy import into Singapore.

Up to 100 megawatts (MW) of hydropower from Laos will be brought into Singapore using existing interconnectors under the Lao PDR-Thailand-Malaysia-Singapore Power Integration Project.

The 100MW account for about 1.5 per cent of Singapore's peak electricity demand in 2020 and could power around 144,000 four-room Housing Board flats for a year.

This follows an agreement inked in September last year between Keppel Electric - a wholly owned subsidiary of Keppel Infrastructure Holdings - and Electricite du Laos - the state-owned power supplier of Laos - to import renewable energy into Singapore.

The two organisations have also signed an initial two-year power purchase agreement.

The power integration project is a step forward in the development of a broader Asean power grid, said the Energy Market Authority (EMA), the Ministry of Energy and Mines of Laos, Electricite du Laos and Keppel in a joint statement.

"The Asean power grid is a key regional initiative to enhance interconnectivity, energy security and sustainability through existing electricity interconnections," the joint statement added.

Singapore last October announced plans to import 30 per cent of its electricity from low-carbon sources, such as renewable energy plants, by 2035, to reduce its carbon footprint.

At present, more than 95 per cent of Singapore's electricity is generated by burning natural gas, a fossil fuel. The power sector is responsible for about 40 per cent of Singapore's total emissions; however, a recent report commissioned by EMA found it would be feasible for the sector to reach net-zero emissions by 2050.

But land constraints in Singapore hinder the construction of large solar farms, and the country also cannot access alternative forms of renewable energy.

Still, Singapore's power sector can reach its net-zero target by 2050 by importing clean energy generated elsewhere, the report found.

Keppel Electric is the first entity to be issued an electricity importer licence by EMA. But the authority has also announced plans to import electricity from other sources.

Last October, the EMA announced that YTL PowerSeraya - a generation company and electricity retailer in Singapore - would be embarking on a two-year trial project to import 100MW of electricity from Malaysia. This pilot is expected to start this year.

EMA is also working with power generation company PacificLight Power on a pilot to import 100MW from a solar farm in Pulau Bulan, Indonesia. Electricity will be supplied via a new interconnector that directly connects a solar farm in Pulau Bulan to PacificLight's power station in Singapore. The pilot is expected to be commissioned by around 2024.

EMA chief executive Ngiam Shih Chun said: "Interconnected power grids can accelerate the deployment of renewable energy, promote supply diversification, and strengthen grid stability for the region as a whole."

Dr Victor Nian, CEO of independent think-tank Centre for Strategic Energy and Resources, said that the import of 100MW of renewable energy from Laos is unlikely to have an impact on electricity prices here since the imported electricity makes up only a small fraction of the country's energy mix.

He said the pilots will have to look into a number of issues to determine the feasibility of scaling up cross-border electricity flow.

A key one, he noted, is how imported electricity will affect the reliability of Singapore's power grid.

Other issues to consider would be whether cross-border infrastructure could handle the transnational flow of electricity and how electricity imports would affect generation companies in Singapore.

"Would renewable energy imports replace some generation capacity in Singapore? If some generation plants were to be kept as standby in case of regional disruptions, then the impact on the business models of the generation companies would have to be studied too," said Dr Nian.


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A version of this article appeared in the print edition of The Straits Times on June 24, 2022, with the headline From Laos to Singapore: Import of renewable energy starts. Subscribe