The world was on track to have peaks on emissions before the outbreak of Covid-19. Now, countries must turn to “game changers” in order to catch up with net-zero pledges, urges Fauziah Marzuki, head of BloombergNEF’s APAC gas, power and carbon research.
Time was not the only thing lost in the past few years: Renewable energy projects were also mothballed due to supply chain constraints and inflationary risks.
She continues: “We just lost those years to commercialise these very critical technologies. We’ve got 10 years to do more to meet the net-zero scenario.”
That may be true, but with recessionary risks and higher interest rates, countries and corporations are understandably thrifty. The momentum to invest in renewables faces “shortterm paralysis”, warns CEO of the Philippines-listed energy platform AC Energy Eric Francia. “A lot of infrastructure investors require long-term contracts. But customers aren’t willing to write long-term contracts now when prices are elevated.”
Still, Francia claims he has “never been so bullish on renewables before” and that the potential vicious cycle needs to be broken. “One needs to take risks that one is not used to. There are a lot of opportunities in this adversity… As the saying goes: Never waste a good crisis.”
See also: Sembcorp and NYSE-listed Bloom Energy to bring low-carbon solutions to Singapore
Fauziah and Francia were speaking at the Singapore Energy Transition Conference 2022, which was held on June 23. The event was organised by DNV, a Norway-headquartered international accredited registrar and classification society.
At the conference, speakers highlighted a handful of renewable energy solutions.
See also: Unlocking opportunities in Asean while managing governance and compliance risks
For example, Fauziah expects hydrogen and carbon capture, utilisation and storage (CCUS) solutions to be the critical key technologies that will help the world achieve its net-zero targets.
“If we want any chance of achieving that scenario, those technologies need to be scaled and deployed en masse by 2030 if we want to make 2050 [goals]. Those two technologies are the potential game changers,” she explains. “There’s only so much you can electrify, so these are the technologies that are actually going to make a difference in the hard-to-abate sectors.”
She also points to direct air capture of carbon dioxide, a nascent technology that remains costly today. “It may not be a clean energy technology but it is a climate technology. They’re sucking carbon dioxide out of the atmosphere and putting it into deep geological formations and storing it there… We should keep our eye on those kinds of technologies even though they are expensive.”
Meanwhile, Surbana Jurong’s senior director for energy and industrial Tan Wooi Leong argues that battery storage systems are crucial to optimise even a fully renewable energy grid.
The wind won’t blow where you want the wind to be, the sun won’t shine brighter where you want it to be. So, all these are going to change as we move forward.
He adds: “Today, there are technologies in the market, but some are not mature enough to be commercially viable. The energy storage system is one key area that I think may be very critical. It plays a part in forming capacity.”
“If you look at generation sources today, it looks fine, it looks well, but climate change will change everything,” Tan tells The Edge Singapore in a separate interview. “The wind won’t blow where you want the wind to be, the sun won’t shine brighter where you want it to be. So, all these are going to change as we move forward.”
To stay ahead of Singapore and the region’s corporate and economic trends, click here for Latest Section
Agreeing, Francia says that as we scale up our renewables, “we need battery storage to unlock the full potential of renewables. Otherwise, we’ll be limited by transmission constraints, which is one of the greatest pain points in the industry.”
Energy security at any cost?
However, Tan concedes that cost remains the main consideration for customers. “To the public or private sector, cost is always a candidate. You are comparing this to your grid supply, which already comes in with a tariff. So, whatever solutions you come up with must match or be better, even though it is green.”
The cost of solar power, for example, has fallen to become a feasible option for homes and businesses. “We can implement it almost immediately,” notes Tan.
On the other hand, hydrogen and CCUS are “a bit further away”. “You need to bring the cost per tonne down, CCUS solutions may not even be viable today. Looking at all these, it is rather difficult — very challenging — under current circumstances, to really find a silver bullet.”
But even a silver bullet cannot pierce the hide of a war. Before Russia’s invasion of Ukraine, the push for renewables was “tremendous”, offers Tan. “But when the war broke out, Europe [softened] their rhetoric on green power; even Germany has restarted coal power. So, there’s a big scramble for energy.”
If the war stops immediately, that will help a lot. But I don’t foresee that happening.
When will the world return to that sweet spot? Tan hopes for a stop to the war, or at least a “repositioning” where ample renewables replace fossil fuels in the world’s energy mix. “If the war stops immediately, that will help a lot. But I don’t foresee that happening.”
Energy security, the green transition and affordability make up the “trilemma” for today’s national power grids, says BloombergNEF’s Fauziah.
If we must ensure energy security in Singapore, we probably might do it at any cost. I think that is where we are today.
But here, Singapore prizes one over the others, adds Tan. “Singapore is all about energy security,” he continues. “If we must ensure energy security in Singapore, we probably might do it at any cost. I think that is where we are today.”
Securing energy security across the board and having that diversity is also critical. Tan explains: “Diversity can come in the form of energy imports, hydrogen, or even nuclear [power]. That diversity will help us move further into the future.”
Surbana Jurong’s business is entrenched across “all paths of urbanisation”, he adds. This puts it in good stead in the renewable energy transition, and “we are well-positioned to tap on all the opportunities related to all the sectors.”
For example, SMEC, a member of the Surbana Jurong Group, has joined four other industry giants to deliver the Australia-Asia PowerLink (AAPowerLink), one of the world’s largest renewable energy projects. Headed by Sun Cable, its solar farms will be located in Australia’s Northern Territory.
The project will also host the world’s largest battery and the world’s longest undersea high voltage direct current (HVDC) cable system from Darwin to Singapore, measuring 4,200km. The project is expected to begin supplying electricity to Singapore in 2027, and is touted to provide up to 15% of the nation’s total electricity needs in a year.
‘Lead the charge’
In January, Singapore’s Global Centre for Maritime Decarbonisation (GCMD) selected DNV to lead an ammonia bunkering safety study, with input from Surbana Jurong and the Singapore Maritime Academy.
With further research on the carbon-neutral fuel, DNV expects there will be demonstration projects for onboard use of ammonia by 2025, paving the way for zero-carbon ships ready for commercial use by 2030.
Tan believes the timeline is attainable. “Singapore is unique, we have an ecosystem in place that makes it very easy for us to leverage and hop onto the ammonia bandwagon. We have people and talent here who know how to do that fast.”
The impetus still rests very much on the corporations and their strategy.
The onus is now on corporations to lead the charge, he says. “What I would like to put in perspective is that though there are many challenges in the energy transition, the impetus still rests very much on the corporations and their strategy.”
This can be overcome if they can see a “very clear” roadmap leading to that transition, Tan concludes. “It is not daunting, actually. It is something that needs time; nobody is asking us to do it overnight. It’s about corporations and public sectors embarking on that roadmap towards energy transition and meeting carbon targets eventually. I believe that is attainable. It’s better to do something than to not do anything at all.”
Photos: DNV, Surbana Jurong, Sun Cable
