Energy Security in Singapore

1
Energy Security in Singapore

• Regional Workshop on Energy and Non-Traditional
  Security
• Singapore, 2008
• Chang Youngho Nur Azha Putra
• NTS-Center

2
Scope

• Energy Consumption in Singapore
• National Energy Policy Report (NEPR)
• Electricity Market, Policy and Regulation
• Research and Development
• Regional Cooperation/Integration
• International Participation
• Conclusion Final Remarks

3
Energy Consumption in Singapore

• Singapore is an island city with limited energy
  resources
• Currently, energy market entirely reliant on oil
  natural gas imports
• (2007) Singapore electricity generated from
• Natural gas 76 percent
• Fuel oil 22 percent
• Refuse 2 percent
• Diesel 0.3 percent
• 80 percent of gas imported from Indonesia
  Malaysia

4
Sources of Singapore Electricity (2007)
Diesel
5
Energy Consumption in Singapore (contd.)

• Singapore Crude Oil sources (2006)
• Saudi Arabia, 32.8
• Kuwait, 18.0
• Qatar, 13.5
• UAE, 10.5
• Other Middle East, 7.1
• Vietnam, 4.4 Australia, 4.5 Malaysia, 3.7
  and others, 5.4.
• Middle East accounts for 75 out of which, almost
  33 is from Saudi Arabia

6
Spore Sources of Crude Oil (in ) (2006)
7
Energy Consumption in Singapore (contd.)

• Singapore energy mix is one of the least
  diversified in Asean
• Government plan to add liquefied natural gas
  (LNG) to its future fuel mix diversified gas
  sources
• Plan to construct LNG terminal by 2012, at a
  projected cost of 1 billion
• Terminal expected to meet initial demands up to 3
  mill. tonnes per annum
• import LNG from nations further away
• Construction of LNG Terminal is one of the
  initiatives outlined in the National Energy
  Policy Report

8
National Energy Policy Report (NEPR)

• Energy for Growth announced by the government in
  2007
• Sees Energy as a source of economic growth
• prepared by the Energy Policy Group (EPG)
• EPG formed in 2006
• an inter-ministerial group led by Ministry of
  Trade and Industry
• members Economic Development Board, Energy
  Market Authority, Ministry of Environment and
  Water Resources, Ministry of Foreign Affairs
  Ministry of Finance

9
National Energy Policy Report (NEPR)

• Holistic approach towards energy security
• National,
• Regional
• International level
• Aims to carry out three main policy objectives
• Economic competitiveness
• Energy security
• Environmental sustainability
• Policy objectives translates into six strategies
• Promote competitive markets
• Diversify energy supplies
• Improve energy efficiency
• Build energy industry and invest in RD
• International cooperation
• Whole-of-Government Approach

10
National Energy Policy Report (NEPR)

• What does it mean for Singapore?
• At the National Institutional Framework
• Develop Strengthen government agencies, support
  research institutions and think-tanks
• Create agencies with specific functions
• certain agencies with added roles and functions

11
National Energy Policy Report (NEPR)

• Whole-of-Government Approach
• Energy Division (ED)
• develops manages Spores overall energy policy
• Energy Market Authority (EMA)
• regulates the electricity gas industry and
  district cooling services
• Clean Energy Programme Office (CEPO)
• plan execute strategies to develop Spore into
  Global Clean Energy Hub
• Energy Efficiency Programme Office (E2PO)
• improve energy efficiency Energy Efficient
  Singapore
• Energy Studies Institute (ESI)
• conduct independent research analyses on global
  energy issues

12
Electricity Market, Policy and Regulation

• Electricity Act 2001
• introduced to develop a more cost-efficient
  electricity market
• Before
• National electricity piped-gas industries were
  vertically integrated and state owned
• managed by Public Utilities Board (PUB) (up to
  1995)
• formed in 1963 to managed supply of water,
  electricity and piped gas

13
Electricity Market, Policy and Regulation

• 1995
• national electricity and piped-gas undertakings
  were corporatized
• 1998
• Singapore Electricity Pool was formed
• introduce wholesale electricity market
• 2000
• market further de-regularized
• introduction of independent system operator
• liberalisation of retail market
• separate ownership of contestable
  non-contestable parts of the electricity industry
• gas industry - restructured and liberalised as
  well

14
Electricity Market, Policy and Regulation

• 2001
• Energy Market Authority (EMA) was formed
• EMA took over PUB
• regulating electricity, gas industries and
  certain cooling services
• Energy Market Company formed
• Pool Administrator of Singapore Electricity Pool
• 2003
• New electricity wholesale market began its
  operation
• 2006
• New Singapore Electricity Market (NEM) introduced
• consists wholesale retail market regulated by
  EMA
• retail market introduced in three phases
• industrial household consumers choose their
  own retailers

15
Electricity Market, Policy and Regulation

• Vesting Contracts
• to curb market power of large power-generation
  companies
• contractual agreement between power companies and
  Market Support Services Licensee
• contract electricity to be sold at a certain
  amount and price
• Voluntary Vesting Contracts
• offered to smaller companies
• EMA determines level vesting contract every two
  years

16
Electricity Market, Policy and Regulation

• Electricity Vending System (EVS)
• 10,000 large consumers account for 75 percent of
  total demand
• 25 percent (SMEs households) remains
  uncontestable
• continue to purchase only from SP Services Ltd.
• EVS empowers small size consumers access to
  different packages offered by retailers
• target date of completion in 2009
• pilot project funded by PMO and SP Services Ltd.

17
Research and Development

• EPG identifies RD as key towards achieving
  energy security sustainable development
• identifies photovoltaic (PV) as a source of clean
  energy
• National Research Foundation provides 170
  million for solar research
• PV as a source of diversifying Singapores energy
  mix
• Singapore also well placed to develop PV
  capabilities and serve as exporter to the region

18
Regional Cooperation/Integration

• Singapore active in various energy-related
  initiatives
• As a member of ASEAN, Singapore has signed MOUs
  on
• Energy Security
• ASEAN Power Grid
• Trans-ASEAN Gas Pipelines project
• Represented at the
• East Asia Summits Energy Task Force
• APECs Energy Task Force
• International Participation
• Singapore acceded to the Kyoto Protocol in 2006

19
Summary

• Singapore sees energy as a source of economic
  growth
• Pursues energy security at three levels
• National
• Aims to diversify national energy mix with LNG
• Introduce state agencies and support think-tanks
  and research on energy related issues
• Pursues open market liberalisation to ensure
  that price of consumption remains low
• Uses vesting contracts to curb market power
• Invest in RD on solar energy
• Regional
• Engage policy of cooperation and integration with
  other member states via ASEAN East Asia Summit
  platform
• International
• Acceded to the Kyoto Protocol in 2006

20
In Conclusion

• Will the restructuring of the electricity market
  ensure energy security in Singapore in the long
  run?
• How effective are vesting contracts at curbing
  market power?
• What are the impact of the fully liberalized
  retail electricity market on household consumers
  and small-medium enterprises?

21

• The End.