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Infrastructure & PPPs in Singapore, Laos and Cambodia - Q4 2021 Update

We have summarized key developments across Singapore, Laos ad Cambodia in our latest insight.


SINGAPORE is taking steps as per Green Plan to promote C&I solar, EVs and importing green energy in the country. LAOS has renewed focus on transport sector through PPPs and has seen some large floating solar developments. CAMBODIA continues to see support from international developers and DFIs for infra sector development.


Read the latest developments in Infrastructure and PPPs in the three countries in our final insight of Q4 2021 series.

 

Singapore

SINGAPORE LNG PARTNERS WITH LINDE GAS FOR CARBON CAPTURE PROJECT

Singapore LNG Corporation (SLNG) and Linde Gas Singapore have partnered to explore the feasibility of developing a carbon dioxide (CO2) liquefaction and storage facility next to the island state's sole liquefied natural gas terminal on Jurong Island. SLNG and Dublin-based Linde Gas signed a memorandum of understanding (MoU) for the project.

If viable, the facility will be the first of its kind in Singapore and the region, the project will use cold energy from the Jurong Island terminal to initially liquefy, store and transport carbon dioxide for both partners. It will potentially be scaled up to handle carbon dioxide from more sources.

The liquefied CO2 will be stored in tanks before it is eventually despatched for end use. It is largely used for refrigeration and freezing as well as in welding applications.


SUNSEAP SECURES USD 63.6MN PROJECT FINANCE FOR 70 MW PROJECT

Singapore renewables developer Sunseap Group has secured an SGD 85.8Mn (USD 63.6Mn) green loan from DBS and United Overseas Bank (UOB) to finance its 70 MWp SolarNova 4 project. The project will install solar panels on the roofs of 1,200 public housing blocks and 49 government sites.

DBS and UOB will lend half of the debt each. The loan uses Sunseap's Green Financing Framework, which is aligned to the International and Capital Market Association's Green Bond Principles 2018, the Loan Market Association's Green Loan Principles 2018 and the ASEAN Green Bond Standards 2018.

The transaction is Singapore's largest renewables non-recourse transaction to date. It is also the first project finance transaction priced off the new Singapore Overnight Rate Average, a fixed-income benchmark introduced as part of a worldwide push to replace LIBOR. The project is the first Singapore project finance transaction which is secured against a virtual power purchase agreement.

Facebook has signed a virtual power purchase agreement (VPPA) to buy renewable energy certificates, representing the excess power generated by SolarNova 4. The VPPA will be used to support Facebook's Singapore data centre. Sunseap won the tender for SolarNova 4 in 2019. Singapore's Housing Development Board and Economic Development Board are trying to promote and aggregate solar demand in the city state.


COMFORTDELGRO PARTNERS ENGIE FOR SINGAPORE EV CHARGING INFRASTRUCTURE

A unit of Singaporean land transport major ComfortDelGro and French energy developer Engie's Southeast Asian arm will set up a joint venture to develop renewable power for charging electric vehicles (EV) in Singapore.

The new company - ComfortDelGro Engie Solar - will develop and manage solar solutions to power up charging stations for both ComfortDelGro’s fleet of EVs as well as those for users of public vehicles. Engie South East Asia will own 51% in the joint venture while the remaining will be with ComfortDelGro Engineering. The two partners plan to expand operations covering the rest of Southeast Asia after strengthening base in Singapore. The venture will also target commercial and industrial customers in the island state and aims to start operations by the second half of next year.

The first project will be to install and operate rooftop solar panels on three buildings managed by ComfortDelGro at Loyang, Pandan and the Ubi areas in Singapore. The developments will also provide power to automotive workshops. Singapore needs charging farms powered by renewable energy. The company aims to create the infrastructure on its own premises so it could offer fast-charging solutions to all users.


SINGAPORE TO ISSUE 4 GW ENERGY IMPORT RFPS

Singapore's Energy Market Authority plans to issue two Requests for Proposals (RfP) for the import of up to 4 GW of low-carbon electricity into the island nation. The EMA plans to issue an RfP next month for 1.2 GW of clean energy and a second 2.8 GW RfP in the second quarter of next year.

The imports should account for around 30% of Singapore's electricity supply in 2035. The remaining supply will come from natural gas-fired power plants, solar and waste-to-energy facilities.

Singapore is seeking to develop regional power grids and support regional decarbonisation, while diversifying the country's energy sources. The country has, so far, awarded SGD 55m in grants to support 12 low-carbon research, development and demonstration projects.

Singapore started working on an electricity import plan in 2019. This year, the country contracted with Malaysia's YTL PowerSeraya to import 100 MW of clean energy from Malaysia using the existing interconnector for the next two years. The contract will start early 2022.


SINGAPORE AND ST ENGINEERING EXPLORE SMART RAIL SOLUTIONS PARTNERSHIP

Singapore Technologies Engineering (ST Engineering) is considering tying up with a unit of the city state's Land Transport Authority (LTA) to participate in rail projects around the world. The company has already signed a memorandum of understanding with LTA-owned consultancy MSI Global.

They will explore the possibility of collaborating on consulting opportunities for international rail projects, ST Engineering will provide technical experience in smart metro solutions, while MSI Global will bring in expertise in systems integration for rolling stock, signaling, power supply systems and project management. The agreement will help ST Engineering extend its smart mobility expertise to new international markets


SUSI PARTNERS TO INVEST IN MICROGRIDS WITH SINGAPORE DEVELOPER

Swiss clean energy investor SUSI Partners has agreed to finance microgrids across Southeast Asia with Singapore-based developer Canopy Power. SUSI will invest in Canopy's projects through the Asia Energy Transition Fund.

The microgrids, which are self-sufficient energy systems serving a smaller area or neighborhood, will combine solar photovoltaic with battery storage as well as energy management technology in areas that are disconnected from utility grids. The projects assume importance as a reliable source of clean and cheaper electricity for Southeast Asia, a region with thousands of islands and remote areas.

Canopy will be responsible for the engineering, procurement, and construction for its customers across the tourism, agriculture, mining and fishery industries, and remote communities.


HDB TO INSTALL SOLAR ON 527 BLOCKS IN SINGAPORE

The Housing & Development Board (HDB) of Singapore has planned to install solar PV systems on all 527 eligible HDB blocks in the Tanjong Pagar town. The photovoltaic systems are expected to harness clean energy by 2025, adhering to the town council’s 10-year master plan to be more energy-efficient.

The blocks are projected to achieve net-zero energy consumption on average in common areas, once the installation is complete. The solar photovoltaic systems on HDB blocks, which are under the Governments’ SolarNova program, jointly led by HDB and the Economic Development Board (EDB), will have a total solar capacity of 26.5 MWp, equivalent to powering 6,600 four-room HDB flats. HDB’s 10-year plan “Green Towns Programme” aims to harness green energy and bring sustainable living to all HDB towns.


Laos

LAOS SEEKS CHINESE INTEREST IN NEW PPP HIGHWAYS

The Laotian government is seeking Chinese interest in its public-private partnership (PPP) expressway projects. One of these will connect the capital city of Vientiane through Xaysomboun, Xieng Khuang and Huaphan provinces to the Vietnamese border.

The proposed motorway will also link to an existing northern expressway which connects Vientiane with Moten town on the Chinese border. The new project - the Vientiane-Xaysomboun-Xiengkhouang-Houaphan Expressway - will be taken up in the build, operate, transfer (BOT) model. The ministry invited Chinese investors to explore project opportunities in various infrastructure segments such as airports, water, waste management, renewables, social infrastructure and other large-scale PPPs.

Some Chinese companies such as the China Railway Group and Yunnan Construction Investment are already involved in projects in Laos. China Railway Group owns 70% of the 417km China-Laos Railway. Construction of the USD 5.7Bn project is almost complete. The company will operate the asset for 50 years.

Building major Yunnan Construction Investment is developing a 460km BOT highway linking the Laotian capital to the country's border with China. It holds 95% of the road company. The project, which is partially completed, is being built in several phases with a total cost of USD 8.39Bn. The contract was signed in 2018. The concession period is for 50 years.


GOVERNMENT OF JAPAN TO PROVIDE USD 8.8MN OF AIRPORT EQUIPMENT TO LAOS

The Government of Japan will provide USD 8.8Mn worth of airport-related equipment to Laos under an agreement on airport-related equipment provision and grant aid. Under the agreement, the Government of Japan will provide airport-related equipment, including buses to transfer passengers between the terminal building and flights, airport air conditioning systems, and boarding bridges.

By boosting the quality of airport services in Laos and strengthening passenger response capacity, the grant will contribute to the improvement of the transportation environment and economic growth. The assistance also supports the Government of Laos’s aim of improving international airport infrastructure and promoting regional connectivity.


INNOSEA TO DEVELOP A 240 MWP FLOATING SOLAR PROJECT IN LAOS

Innosea, a subsidiary of AqualisBraemar LOC ASA (AQUA), has announced plans to develop a 240 MWp floating solar PV (FPV) project at a hydroelectric plant reservoir in Laos. Innosea will serve as technical advisor on the owner’s engineer team and provide support for wave and anchoring studies during the course of the project development.

The solar plant will be located on the reservoir of the Nam Theun 2 hydropower plant. Its panels are expected to cover an area of 3.2 square km of water surface with no land intrusion. The FPV is expected to reduce water evaporation, which in turn will increase the annual hydropower production.


GOVERNMENT OF LAOS ANNOUNCES EV TARGETS FOR 2025 AND 2030

The Government of Laos is aiming to increase the share of electric vehicles (EV) in the country to one per cent by 2025 and over 30 per cent by 2030. In line with the new targets, the government has approved a new policy on the use of EVs to minimize fuel imports and reduce carbon emissions.

As a part of the policy, the government will not impose import limits on EVs in order to boost the number of EV dealers in Laos, but vehicles imported and sold in the country will have to fulfil international standards for quality, safety, after-sales service, and maintenance. This will include a strategy for managing waste generated by electric vehicle firms. The government will also introduce incentives to encourage businesses to develop facilities to produce EV parts and other components, as well as invest in the deployment of charging stations throughout the country. There will also be tax exemptions or reductions on the equipment imported for EV production and charging stations.

Electricite du Laos (EdL), the state-owned power utility, has been selected as the service provider for the installation of charging stations, and has been instructed to not impose metre fees to residents or companies that use the facilities. Additionally, the company will also provide priority EV parking spots and charging stations in public spaces.


Cambodia

B.GRIMM POWER GETS USD 28MN LOAN FOR SOLAR PLANT IN CAMBODIA

B.Grimm Power plc has secured USD 28Mn in a syndicated loan from Thailand’s top financers to undergird its solar energy project in Cambodia. The financial facility is provided under the 15-year accord signed by Kasikornbank, Exim Thailand, and Bangkok Bank to fund the 39 MW solar plant in Cambodia’s Banteay Meanchey Province operated by Ray Power Supply Co., Ltd (RPS), a wholly-owned subsidiary of B. Grimm Solar Power 1 Co., Ltd.


TOTAL EREN ENTERS CAMBODIA WITH A 74 MW SOLAR PROJECT

Total Eren, a leading renewable Independent Power Producer (“IPP”) based in Paris, is pleased to announce its first steps in the Cambodian renewable energy market through the acquisition of a 73.9 MWp photovoltaic (PV) Project named “Battambang” from Risen Energy, a Chinese developer active in R&D and PV panels manufacturing. The PV farm is currently in operation in the Battambang Province, Northwest Cambodia.

Total Eren acquired Battambang Co., Ltd (“Battambang”) from Risen Energy, a listed Chinese company that has developed, built, financed and recently commissioned the project in March 2021. Risen Energy will be performing the maintenance of the PV farm for the next 2 years.


CAMBODIA TO ADD 495 MW OF SOLAR POWER FROM SEVEN PROJECTS BY 2023

Cambodia will add 495 MW of solar power capacity from seven projects by 2023, which will represent 20 % of the total energy supply by then. Country’s electricity supply is dominated by renewable energy, especially hydro, accounting for 88 % on a typical day, followed by solar. The key objectives in the latest power development plan 2020-2040 include accessibility, reliability, affordability, security as well as contribution to address climate change.


ADB LOAN TO FINANCE INFRASTRUCTURE AND ROAD DEVELOPMENT PROJECTS IN CAMBODIA

The Asian Development Bank (ADB) has approved a USD 332Mn loan to support urban infrastructure development as well as expand the current road network in Cambodia. The Ministry of Economy and Finance has signed the loan and grant agreements with ADB which includes USD 180Mn for Liveable Cities Investment Project and USD82Mn for Road Network Improvement Project Phase II, among other projects.

The Liveable Cities Investment Project includes rehabilitation works on the existing wastewater and solid waste management network in the cities of Bavet, Kampot, and Poipet. This project is expected to benefit around 140,000 residents across the three cities. The second phase of the Road Network Improvement Project will renovate approximately 48 km of national and provincial roads in Prey Veng and Kandal. This project is expected to boost economic development around the GMS Southern Economic Corridor.


GOVERNMENT OF CAMBODIA TO CEASE APPROVAL FOR NEW COAL-FIRED POWER PLANTS

The Government of Cambodia will not approve development plans for any new coal-fired power plants in addition to the projects already approved since 2019 and will continue to encourage investment in clean energy to respond to climate change. This is a part of the government’s efforts to transition the country to low-carbon energy sources such as imported natural gas, LNG or hydrogen.

More than half of Cambodia’s total electricity is generated by coal-fired power plants. Coal’s share in the energy mix was set to increase to three-quarters by 2030. However, under the country’s new energy development master plan, the share of electricity generated from renewable energy (RE) sources will be approximately 59% over the next few years.

This announcement is in line with similar moves taken by other governments in the Asia Pacific (APAC) region.


 

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