Singapore saves S$123.8M in fossil fuel import costs as solar power investments cushions global energy crisis

SINGAPORE: Singapore saved US$97 million (S$123.8 million) in fossil fuel import costs, with most of the savings coming from avoided gas imports, a Finland-based Centre for Research on Energy and Clean Air (CREA) report published in late August found, thanks to the city-state’s investments in solar energy.

The estimated savings were recorded over five months earlier this year, after energy prices spiked following a global energy crisis amid conflict in the Strait of Hormuz, according to the report.

About US$40 million of the savings came from avoiding the additional premium on natural gas linked to the crisis, a CREA analyst told The Straits Times. He noted that the savings “demonstrate the benefits of Singapore’s solar expansion programme”

CREA said the figures in the report were derived using wholesale-price estimates.

In April, solar firms in the city-state reportedly started seeing more demand for solar panels after the US-Iran war triggered electricity costs to rise.

Before the rise in solar panel demand, International Energy Agency (IEA) executive director Fatih Birol had also predicted earlier in the month that countries would turn to renewable energy, such as solar and wind, amid the global energy crisis.

Still, CREA noted that Singapore’s reliance on imported fossil fuels caused it to incur an additional US$8.1 billion in gross fossil fuel costs in the six months after the US-Iran war began, placing Singapore 13th among 171 territories for extra fossil fuel import costs during the period.

China, India, and the US recorded the highest costs, the report added.

Netizens welcomed the gains from the city-state’s solar investments. However, one pointed out energy storage as a bottleneck. “If we actually want to replace fossil fuels instead of just supplementing them during peak sun hours, R&D and subsidies need to shift toward battery tech,” the commenter said.

Also, when one commenter said the savings didn’t sound a lot in today’s economy, another remarked, “Solar energy only accounts for about 2% of our electricity use. The fact that that’s enough to save us S$123.8M in five months is pretty good. Besides, financial gain shouldn’t be the main factor for switching to greener energy.” /TISG

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