Singapore’s 6‑GW power‑import plan seen anchoring ASEAN

Singapore’s plan to import up to 6 gigawatts (GW) of low-carbon electricity by 2035 could support financing for renewable generation and transmission projects across Southeast Asia.

The planned imports could serve as a commercial anchor for the ASEAN Power Grid, particularly projects linking Singapore with Indonesia and Malaysia, according to a Singapore Sustainable Finance Association (SSFA) report.

The report said long-term export demand from Singapore may help underpin renewable energy development in the Riau Islands, alongside investment in generation, transmission, and related supply chains.

SSFA said, citing estimates from the Institute for Energy Economics and Financial Analysis, this could generate about $5.4b (US$4.2b) in foreign exchange earnings and $268.2m (US$210m) in tax revenue annually for Indonesia.

For Sarawak, Singapore’s demand could provide an additional market for surplus hydropower and support the state’s wider renewable energy development strategy.

The credit quality of Singapore-based electricity buyers could also improve project bankability.

“Investment-grade counterparties, such as EMA-licensed entities and major energy players, and credible corporate offtakers, provide lenders with confidence in long-term revenue flows,” SSFA said.

“Projects backed by Singapore’s demand can potentially achieve a lower cost of capital,” it added.

However, the SSFA noted that the market’s demand alone would not be enough to make projects financeable.

It added that unclear risk allocation, unresolved regulatory frameworks, and uncertain revenue assumptions could raise financing costs or prevent projects from reaching financial close.

More information:https://asian-power.com/news/singapores-6-gw-power-import-plan-seen-anchoring-asean