Singapore’s greenhouse gas emissions dipped in 2023 but could rise again

SINGAPORE – The Republic’s planet-warming greenhouse gas emissions dipped to 55.5 million tonnes (Mt) in 2023, largely owing to a fall in manufacturing output from the petrochemical sector.

This was a 5.3 per cent drop from the

previous year’s emissions

of 58.59Mt of carbon dioxide equivalent (CO2 eq), the National Climate Change Secretariat said on its website on Dec 19.

CO2 eq is a term used as a measurement of total greenhouse gases emitted.

While the decline is the first since 2008, analysts told The Straits Times that sustaining the decrease in emissions is key.

This is the most recent report on Singapore’s greenhouse gas emissions.

The drop was mainly due to less greenhouse gases being directly released by the industry sector, the largest contributor to Singapore’s emissions, according to the secretariat, a group under the Prime Minister’s Office.

The sector accounted for nearly half of those emissions in 2023, followed by the power sector at 38.7 per cent, and the transport sector at 11.7 per cent.

Also driving the decline in emissions was a continued decrease in petrol and diesel consumption in the transport sector, which reflects progress towards achieving the target of 100 per cent cleaner energy vehicles by 2040, the secretariat said.

But it also noted that emissions could still rise before 2030 because of economic conditions and the progressive implementation of Singapore’s mitigation measures.

The Republic previously said it aims to have its planet-warming emissions reach a peak in 2028, before coming down to about 60Mt in 2030.

Analysts told ST that the decline in greenhouse gas emissions is significant, however it remains to be seen whether the progress can be sustained as economic activity grows.

Climate observer Melissa Low said the dip in 2023 emissions marks the first such decline in emissions after the 2008 financial crisis, with records showing that emissions have been trending upwards since then.

Ms Low, a research fellow studying global climate policy at the NUS Centre for Nature-based Climate Solutions, was cautiously optimistic about whether the decrease will have a positive impact.

“The drop in emissions year on year may be encouraging from a climate perspective, but from an economic perspective, there may be concerns about the fall in manufacturing output causing a recession and job cuts due to poorer economic conditions globally,” she added.

Ms Low noted that the reduced emissions could also mean slower demand from Singapore for international carbon credits, with the Republic expected to purchase offsets for its emissions from other countries, to fund climate projects in these countries.

Nanyang Technological University associate professor of accounting Kelvin Law said the drop in industrial emissions is likely tied to global market conditions, citing significant pressure in the Asia-Pacific markets from Chinese overcapacity and Singapore’s chemicals cluster experiencing seven consecutive quarters of decline from early 2022 to late 2023.

“This suggests the industrial emissions drop is tied to global market conditions, which can reverse,” he said, adding that the Government’s statement acknowledges that emissions could rise.

He added: “The transport sector improvements are more encouraging because they reflect genuine shifts towards cleaner vehicles and public transit. That portion of the decline is more likely to persist.”

From a technical standpoint, 2023 represents a year when emissions declined, but gross domestic product grew, said Prof Law.

The question is whether Singapore can sustain a reduction in emissions when petrochemical markets recover, or whether it will revert to growing with economic growth, he added.

Dr Su Bin, a senior research fellow at NUS’ Energy Studies Institute, noted that there was little change in electricity consumption or power-sector carbon intensity for industry amid contracting manufacturing output.

He said: “The evidence suggests the emissions decline was largely activity-driven rather than structural.

“Emissions fell broadly in line with reduced production, particularly in carbon-intensive industries, rather than because of major efficiency gains or fuel switching.”

While quantitatively significant, the absence of decline from electricity-related emissions highlights the risk that industrial emissions could rebound when output recovers, said Dr Su.

Sustained emissions reductions will require structural changes, such as cleaner fuels, carbon capture, low-carbon hydrogen and efficiency improvements, rather than relying on cyclical slowdowns, he added.

Economist David Broadstock, a partner at energy industry consultancy The Lantau Group, said that while the decrease in emissions was significant, Singapore’s economy and the rest of the world had still been recovering from the impact of the Covid-19 pandemic.

“As one datapoint, it might not be fully reflective of the core trend, so this could also be a momentary dip,” said Dr Broadstock.

“Given Singapore’s ambition to de-carbonise, there is optimism that its manufacturing sector will still be restructured, even with an increase in economic activity.”

Emitters are expected to pay more for their

emissions from 2026

, as Singapore’s carbon tax rises from $25 per tonne of carbon dioxide emissions to $45.

There are about 50 carbon tax-paying facilities in Singapore, mainly in the manufacturing, power, waste and water sectors. These emitters account for about 70 per cent of the total national emissions.

In February, Singapore committed to reducing emissions to between 45Mt CO2 eq and 50Mt CO2 eq by 2035 as part of its climate targets submitted to the United Nations.

The National Climate Change Secretariat said it remains committed to achieving its 2030 and 2035 targets, which depend on whether decarbonisation technology matures, and on effective international cooperation.

It said a detailed breakdown of the 2023 emissions will be reported in its second Biennial Transparency Report in 2026.

These reports are submitted to the UN, with countries that have signed the Paris Agreement – the world’s climate pact – expected to submit every two years.