Singapore grants conditional approval for Sun Cable to import 1.75GW of electricity from Australia - CNA

Singapore

The project to transmit solar power from Australia to Singapore has been revived more than 20 months after Sun Cable went into voluntary administration.

A 12,000-hectare solar farm will be built in Australia's Northern Territory. (Image: Sun Cable)

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SINGAPORE: Singapore has granted conditional approval to Sun Cable to import 1.75 gigawatt (GW) of low-carbon electricity from Australia to Singapore.

The imported electricity is expected to harness solar power from Australia's Northern Territory and will be transmitted via new subsea cables measuring 4,300km, said the Energy Market Authority (EMA) on Tuesday (Oct 22).

Sun Cable said its US$13.5 billion solar project in Australia, the Australia-Asia PowerLink, is set to be the "world’s largest solar farm and battery storage infrastructure".

The amount of renewable energy imported represents about 9 per cent of Singapore’s total electricity needs, the company added.

EMA said: "The conditional approval awarded to Sun Cable recognises that the project can be technically and commercially viable based on the proposal and information submitted thus far."

This will provide the company with the support to continue to develop the project, which is expected to start after 2035.

Sun Cable must update its proposal to meet EMA's conditions before the project can be considered for a conditional licence.

These conditions include compliance with EMA's technical requirements and achieving a commercially viable price acceptable to customers.

"Sun Cable will also need to secure all requisite approvals of relevant jurisdictions, including countries which the cables will pass through," said EMA.

Speaking at the Asia Clean Energy Summit on Tuesday, Second Minister for Trade and Industry Tan See Leng called the proposal "an ambitious project", given the scale and the distance between Australia and Singapore.

"Time will be needed to develop it, and we expect it to come online only after 2035," Dr Tan said.

"But when completed, the project will be a meaningful complement to the ASEAN (Association of Southeast Asian Nations) Power Grid, and serve as an additional source of electricity for Singapore."

The company said the cables will be laid through Indonesian waters.

This is not the first time such a project has been mooted. Sun Cable had intended to begin construction on the undersea cables in 2024 and be fully operational by 2029, but the company fell into voluntary administration in January 2023.

The firm had fallen short of funds, it announced then. Voluntary administration refers to a process where a company's directors appoint independent administrators to step in to find a path forward for the business, which is usually facing financial difficulties.

Trade and Industry Minister Gan Kim Yong said in February 2023 that the company's decision to enter voluntary administration did not affect Singapore financially as it had not made any commitment to the project.

In May that year, the company's administrators said it had been rescued by part owner and Australian tech entrepreneur Mike Cannon-Brookes.

Interim CEO of Sun Cable International Mitesh Patel said: "Conditional approval is a vote of confidence from the Singapore government in Sun Cable and our role as a key partner to support the nation’s green transition."

He added that Sun Cable is confident that it can meet the next stage of requirements for a conditional licence.

"We firmly believe that high voltage long-distance subsea cables are critical to the global energy transition, connecting high-yield renewable energy areas like northern Australia to high-demand centres such as Singapore," he said.

"We continue to work closely with the governments of Australia, Indonesia and Singapore on the project’s development and requisite approvals of relevant jurisdictions to support the Asia-Pacific's renewable energy goals."

Across Australia, Singapore, and Indonesia, over US$170 million has been invested in the project to date.

The Australian government said in August that it had given the go-ahead for the solar project.

Environment Minister Tanya Plibersek said then that the project would help meet the growing demand for renewable energy at home and abroad.

Low-carbon electricity imports are part of Singapore’s strategy to decarbonise the power sector, which currently accounts for about 40 per cent of the country's emissions.

The country is looking to import about 6GW of low-carbon electricity by 2035.

It has granted conditional licences for 2GW of electricity imports from Indonesia, as well as conditional approvals for 1.4GW from Indonesia, 1GW from Cambodia and 1.2GW from Vietnam.

"If realised, these projects will collectively tap a diverse mix of solar energy, hydropower and wind power. They will also contribute to the realisation of the ASEAN Power Grid," said EMA.

Singapore will also import a maximum of 200MW of renewable hydropower through a cross-border initiative called the Lao PDR-Thailand-Malaysia-Singapore Power Integration Project.

The authority said it would continue to explore all decarbonisation options for the power section, including hydrogen, solar, deep geothermal energy, nuclear energy, as well as carbon capture and storage technologies.

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