Such certs help companies sign offtake deals with green power producers in Asean: EMA official
[SINGAPORE] The lack of standards around the cross-border trade of renewable energy certificates (RECs) is a key barrier preventing companies from signing offtake agreements with low-carbon electricity producers around South-east Asia, said Low Xin Wei, assistant chief executive for the markets and systems division at the Energy Market Authority.
This means that there is a lack of additional revenue for these electricity importers, with which the Singapore government is looking to ink electricity import contracts to meet its net-zero targets.
He said that major international standards, such as the Greenhouse Gas Protocol, do not explicitly recognise the cross-border trade of RECs as a valid form of renewable energy procurement.
The only exceptions are in the European Union and North America, where markets have been harmonised, said Low at a climate conference on Thursday (May 8).
RECs are tradeable assets that are issued when 1 megawatt-hour of electricity is generated and delivered to the electricity grid from a renewable energy resource.
Companies can purchase these certificates to reduce their Scope 2 emissions, which are emissions arising from their use of electricity generated from power stations.
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Given that Singapore has limited renewable energy resources, the amount of RECs that can be generated locally is constrained. There would only be a small pool of such certificates for companies to buy to offset their Scope 2 emissions.
The Ministry of Trade and Industry previously announced that plans to establish a cross-border trading framework were under way.
Low also said that there is a need to continue with concrete, small steps to make the Asean power grid a reality, starting with bilateral projects.
“Low-hanging fruits would be those which make use of existing interconnectors.”
This includes the Lao PDR-Thailand-Malaysia-Singapore Power Integration Project – a cross-border electricity trade that imports hydropower from Laos to Singapore – as well as the Energy Exchange Malaysia, a platform to facilitate cross-border electricity sales focused on renewable energy.
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