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Singapore grants conditional approval to import solar power from Australia

Singapore has conditionally approved Sun Cable’s US$24 billion project to import 1.75GW of solar power from Australia’s Northern Territory by 2035. The ambitious project involves 4,200km of subsea cables, marking a major step in Singapore’s clean energy drive, which aims to meet 30% of its energy demand through imports by 2035.

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SINGAPORE: Singapore has given conditional approval for Sun Cable’s US$24 billion (S$31.5 billion) project to import 1.75 gigawatts (GW) of solar power from Australia’s Northern Territory, which is expected to begin after 2035, announced Dr Tan See Leng, Second Minister for Trade and Industry, on 22 October 2024.

The large-scale project, Australia-Asia power link (AAPowerLink), will transmit renewable energy via 4,200km of subsea cables from Darwin, Australia, to Singapore, marking a significant step toward the nation’s clean energy transition.

The approval was disclosed during Dr Tan’s speech at the Asia Clean Energy Summit, part of the Singapore International Energy Week.

He noted that the project is a remarkable undertaking, given the considerable distance between Australia and Singapore.

Despite the extended timeline, he emphasised that Singapore remains committed to supporting credible clean energy import ventures, even if they take time to materialise.

EMA deems Sun Cable’s project viable but demands competitive pricing for consumers

The Energy Market Authority (EMA) confirmed that Sun Cable’s proposal is “technically and commercially viable” but stressed that the project would require the company to offer competitive electricity prices that would be acceptable to Singaporean customers.

SunCable’s project is part of Singapore’s broader strategy to boost its clean electricity imports to 6GW by 2035, which would represent around 30% of its energy demand.

In addition to the Sun Cable project, Singapore has already signed deals to import 5.6GW of clean energy from Indonesia, Cambodia, and Vietnam, according to EMA.

SunCable is expected to further develop its commercial and technical plans, secure relevant approvals, and finalise agreements with all countries the subsea cables will pass through, including Australia and Indonesia.

SunCable’s chief executive, Mitesh Patel, explained that the company aims to sign long-term purchase agreements with corporate buyers in Singapore before 2035.

Potential clients range from large tech companies to pharmaceutical firms.

SunCable to export 1.75GW of solar power to Singapore through a 4,200km subsea cable

Patel also revealed that the project’s first phase will supply between 800 and 900 megawatts of solar power to Darwin’s industrial estates, with the remaining 1.75GW to be exported to Singapore.

To meet these energy targets, the solar farm in Northern Australia is projected to have a capacity of between 17 and 20 GW-peak, making it one of the largest renewable energy installations globally.

The accompanying battery storage system will store between 37 and 42 GW-hours of energy, ensuring stable energy availability despite the intermittent nature of solar power.

Mr Patel also shared updates on the project’s progress. Approximately 70% of the subsea cable route has already been surveyed, and the company expects to reach financial closure by 2027, when all agreements and financing for the project will be secured.

At that stage, construction of the solar farm, battery storage system, and transmission infrastructure will begin. Construction is estimated to cost US$24 billion.

Since its launch in 2019, the Sun Cable project has seen significant milestones, including securing land options for the solar farm, environmental approvals, and completing part of the subsea cable survey.

However, the project faced a major setback in January 2023 when it collapsed due to a funding dispute between Australian mining magnate Andrew Forrest and Atlassian co-founder Mike Cannon-Brookes.

The project was revived in mid-2023 after Grok Ventures, led by Mr Cannon-Brookes, acquired Sun Cable.

The Australian government granted the project approval in August 2024 to begin exporting electricity to Singapore.

Mr Patel expressed confidence in the project’s financial sustainability, citing Grok Ventures’ strong commitment to developing long-distance renewable energy infrastructure to decarbonise the region.

Mr Patel acknowledged that pricing remains an area of uncertainty but pointed to Australia’s superior solar resources, among the top 5% globally, as a competitive advantage.

He emphasised that Sun Cable’s 24/7 renewable energy supply offers the reliability needed for a stable power grid, which is expected to make its energy pricing competitive in the future.

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