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Singapore could soon import renewable energy like solar, hydrogen from Indonesia

Straits Times - March 16, 2023

Cheryl Tan, Singapore – The Republic could potentially tap renewable energy such as solar power and green hydrogen from Indonesia, now that both countries have signed an agreement to facilitate renewable energy cooperation.

The nations will establish a framework to drive investments in developing renewable energy manufacturing industries in Indonesia and cross-border electricity trading projects.

The plan is part of a Memorandum of Understanding (MOU) on Renewable Energy Cooperation.

It was signed by Indonesia's Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan and Singapore's Senior Minister and Coordinating Minister for National Security Teo Chee Hean on Thursday at the Singapore-Indonesia Leaders' Retreat.

Speaking at the Leaders' Retreat at the Istana in Singapore, Prime Minister Lee Hsien Loong said the MOU would support commercial arrangements on the development of renewable energy capabilities, transmission infrastructure, which is the backbone of a country's power system, and the cross-border electricity trade.

"It will strengthen the energy infrastructure, energy transition and energy security for both Singapore and Indonesia, and also support regional initiatives like the Asean power grid. It's a win-win outcome," he said.

The MOU will allow for the development of renewable energy manufacturing industries and capabilities in Indonesia, including solar photovoltaics (PV) and battery energy storage systems, which store excess power for use later. This will leverage investments for electricity export projects to Singapore.

These projects can supply renewable energy to Indonesia for domestic use and for energy export, including the export of green electricity and, when viable, hydrogen and ammonia, harnessing the solar PV systems and battery storage facilities manufactured in Indonesia, said the Ministry of Trade and Industry (MTI) on Thursday.

The effort can support the development of Green Corridors in the Riau Islands and other potential regions in Indonesia, MTI added.

Both countries will promote investments to attract industries harnessing renewable energy into such Green Corridors in Indonesia, including industrial hubs, industrial parks and smart cities.

As part of the agreement, Indonesia and Singapore will also work together to facilitate commercial arrangements and the development of frameworks and transmission infrastructure to allow cross-border electricity trading between Indonesia and Singapore, which can also help generate capital inflows into Indonesia, said the ministry.

With cross-border electricity trade being facilitated between the two countries, it could help Singapore to achieve its goal of importing up to 4 gigawatts of low-carbon electricity by 2035, which will make up about 30 per cent of the Republic's projected energy supply by 2035.

MTI said both governments are reviewing promising commercial proposals that have the potential to meet Indonesia and Singapore's requirements.

Suitable proposals will be chosen and announced in due course. Both governments remain open to receiving new commercial proposals that can meet both their mutual needs.

Over the past two years, at least five Singapore-based firms have signed MOUs with their international counterparts to facilitate the import of clean electricity from Indonesia to Singapore.

In April 2022, Singapore-based renewable energy firm Quantum Power Asia and its Germany-based partner, Ib Vogt GmbH, said US$5 billion (S$6.7 billion) in investments will go towards building a 3.5 gigawatt solar facility and a 12 gigawatt-hour battery storage facility in Indonesia's Riau Islands.

If approved by the Singapore Energy Market Authority, the electricity will be transported to Singapore via an undersea cable and can be fully commissioned by 2032. The companies said at the time that the project could meet up to 8 per cent of Singapore's electricity needs.

In January 2022, Abu Dhabi's Masdar signed an MOU with Singapore's Tuas Power, France's EDF Renewables and PT Indonesia Power to develop as much as 1.2 gigawatts of solar capacity, along with energy storage for export to Singapore.

In 2021, Sembcorp, Batam's utility company PT PLN Batam and Indonesian renewable energy developer PT Trisurya Mitra Bersama (Suryagen) signed an agreement to build 1 gigawatt of solar capacity in the Bintan, Batam and Karimun regions and a large-scale energy storage system to serve local communities and for export to Singapore.

Source: https://www.straitstimes.com/singapore/singapore-and-indonesia-to-boost-renewable-energy-cooperatio