Singapore gives conditional approval for 1.2GW of electricity imports from Vietnam to Sembcorp Utilities

SINGAPORE: The Energy Market Authority (EMA) has granted conditional approval to import 1.2 gigawatts (GW) of electricity from Vietnam, marking another step towards Singapore's goal of importing up to 4GW of low-carbon electricity by 2035. 

The conditional approval means the project by Sembcorp Utilities - a wholly-owned subsidiary of Sembcorp Industries - has been preliminary assessed to be technically and commercially viable.

Second Minister for Trade and Industry Tan See Leng made the announcement on Tuesday (Oct 24) during his speech for the Asia Clean Energy Summit as part of the Singapore International Energy Week.

Singapore previously announced plans to import up to 4GW of low-carbon electricity by 2035 as part of its ambition to decarbonise its energy supply.

Apart from Vietnam, the EMA has granted conditional approvals to projects from Indonesia and Cambodia. These comprise electricity imports of 2GW and 1GW respectively, and will tap into a mix of solar energy, hydropower, and wind power. 

As Singapore lacks renewable energy sources, importing energy allows the country to access cleaner sources from abroad. Regional power grids can also accelerate renewable energy development in the region and facilitate economic growth while diversifying energy sources away from fossil fuels. 

EMA has been working with various partners on electricity import trials, which allows it to refine the technical and regulatory frameworks.

One such project is the Lao PDR-Thailand-Malaysia-Singapore Power Integration Project, where Singapore began importing up to 100 megawatts (MW) of renewable hydropower from Lao PDR via Thailand and Malaysia, in June last year.

Commenting on the project, Dr Tan, who is also Manpower Minister, said it showed how cross-border electricity trading across multiple countries could become a reality in Southeast Asia. 

"Since its commencement, about 270GW hours of electricity has been exported to Singapore from Lao PDR. All four countries are now discussing how we can enhance this project, including trading at capacities beyond 100MW and facilitating electricity flow in all directions."

The project is the first renewable energy import into Singapore and the first multilateral cross-border electricity trade involving four countries from the Association of Southeast Asian Nations (ASEAN).

NEXT STEP FOR SEMBCORP UTILITIES

The conditional approval comes after Singapore and Vietnam signed a Memorandum of Understanding (MOU) on Energy Cooperation in October last year. The MOU served to reaffirm both countries' commitment to support and facilitate clean energy transition efforts and regional decarbonisation, including greater cross-border electricity trading.

Sembcorp Utilities' project proposes to harness offshore wind power and potentially other forms of generation, and is to be developed with Petrovietnam Technical Services Corporation. The electricity will be transmitted from Vietnam to Singapore via new subsea cables that will measure around 1,000km. 

The conditional approval will help Sembcorp Utilities obtain the necessary regulatory approvals and licences for the project. It also builds on the offshore wind site survey permit approval and letter of intent issued to the Sembcorp Utilities-Petrovietnam Technical Services Corporation Consortium by the Vietnam and Singapore governments respectively in August this year, EMA said in a press release issued on Tuesday. 

The next step would be for Sembcorp Utilities to fulfil the conditions set out in the conditional approval, which may include conducting further studies. 

If Sembcorp Utilities meets the conditions set out in the conditional approval, it can then set its sights on obtaining a conditional licence. 

Upon receiving a conditional licence, Sembcorp Utilities can then develop its proposal further, obtain the necessary regulatory approval and secure finances for the project. The next move would be to seek an importer licence ahead of construction, testing and commissioning, with commercial operations as the end goal. 

"We hope that these projects will support the development of our broader ASEAN Power Grid. Given the good progress of this initiative so far, we are  studying the possibility of taking in even more electricity import projects, taking into account energy security and cost considerations," said Dr Tan.