Here is a round-up of key developments and what they mean for businesses.
1. Singapore steps up support for businesses amid the ongoing Middle East conflict
Singapore announced increased support for businesses as part of a S$1 billion package to cushion the impact of rising energy costs from the Middle East conflict. Apart from corporate tax rebates, the base tier of the Energy Efficiency Grant (EEG) will be expanded to support companies from all sectors, up from the current six sectors. The EEG will also be extended by another year to 2028.
Minister Shanmugam also reiterated our commitment to supporting companies’ decarbonisation, but acknowledged that energy security is the current priority worldwide.
2. Singapore’s Budget 2026: Sustainability announcements
Singapore announced new measures to support decarbonisation when it unveiled its Budget for 2026.
As part of Research Innovation and Enterprise (RIE) 2030 plan, Singapore will invest S$800 million over five years to accelerate low-carbon technology development.
The Decarbonisation RIE Grand Challenge initiative will support technologies that reduce emissions from power generation and industrial processes, including hydrogen, solar, energy storage, carbon capture, and grid solutions. A new Singapore Pilots for Energy and Enterprise Decarbonisation (SPEED) programme will support the piloting of commercially viable technologies.
To support business adoption, the Enterprise Financing Scheme–Green (EFS-Green), which gives companies access to government-backed loans to finance green projects and sustainable technology investments, has been extended for five years, while the Energy Efficiency Grant (EEG) has been extended to 2028, helping companies invest in energy-efficient equipment and reduce operating costs.
Singapore also raised our solar deployment target to 3 GWp by 2030, after meeting our 2 GWp target ahead of schedule. Singapore will continue to focus on low-carbon energy imports and further diversify our energy mix.
3. WWF-Singapore and EDB launch programme to tackle hurdles in protecting Asia’s mangroves, seagrass
WWF-Singapore launched a three-year Blue Carbon Support Programme to address key issues faced in mangrove, peatland and seagrass restoration projects. Blue carbon ecosystems can store up to four times more carbon than land forests, yet Southeast Asia has lost more than 30% of mangroves in 40 years. Mangrove restoration projects have very high failure rates, due to high sapling mortality and difficulty in measuring the carbon stored in marine habitats.
Backed by the EDB, programme will focus on improving carbon measurement, addressing access challenges and increasing sapling survival rates. WWF will partner with technology start-ups, researchers and developers to address key barriers. They will also train project teams, test tracking tools, and involve local communities.
New technologies born from the Blue Catalyst innovation challenge, launched last September by Hatch Blue, WWF-Singapore and EDB, will be piloted into this new programme.
4. Singapore’s space office launches biomass dMRV grant call
Singapore’s space office launched a grant to improve biomass estimates by using satellites, geospatial solutions and other space technologies. They are calling for research institutes with expertise in satellite technologies, artificial intelligence modelling and carbon science to develop digital methods that meet the technical challenges of estimating biomass in Southeast Asian ecosystems.
5. Singapore launches calls for international carbon credit project development with Rwanda and Thailand
Singapore launched calls for carbon credit projects with Rwanda and Thailand, the fourth and fifth collaborations respectively following Bhutan, Ghana, and Peru. Approved projects will unlock more emissions reduction potential in Rwanda and carbon mitigation options in Thailand. Through targeted financing arrangements, these projects will help Singapore, Rwanda and Thailand further reduce emissions and advance their respective climate goals.
6. First sustainable aviation fuel (SAF) procurement trial; levy postponed due to energy crisis
Singapore will conduct the first trial of its national sustainable aviation fuel procurement system this year with nine companies, including Temasek, Google, Singapore Airlines and Scoot.
The trial will test end-to-end operational, commercial and accounting processes for national-level procurement and environmental attributes allocation. It will also allow companies to voluntarily purchase SAF to reduce emissions. SAFCo, set up in October 2025, will aggregate mandated and voluntary demand.
The SAF levy, originally meant to apply to departing flights from October 2026, will be postponed to 1 January 2027 following the impact of the ongoing conflict in the Middle East on airlines and passengers.
7. Singapore will draw up its first national climate adaptation plan by 2027
Singapore will designate 2026 as the Year of Climate Adaptation, with a national adaptation plan to be published in 2027. The plan will cover heat resilience, coastal protection, flood management and food and water resilience. A Heat Resilience Policy Office has been set up to coordinate action, oversee research and represent Singapore internationally. The office will launch a S$40 million Adapting to Heat Impacts initiative under the RIE 2030 masterplan will support vulnerable groups and cooling innovations.
Coastal protection studies between Tuas Checkpoint and Lim Chu Kang recommended raising dykes and replacing tidal gates, with construction targeted from the mid-2030s. A proposed coastal protection law may require private landowners to implement resilience measures.
8. Accelerating commercialisation of sustainability innovations
A S$40 million Urban Solutions and Sustainability Translation Fund was launched to was launched to accelerate commercialisation of climate technologies in agri-food, waste, water and urban environments. The fund addresses the persistent gap between research and deployment and mitigate barriers such as high upfront costs and technological risks. Around 20 projects are expected to benefit over five years, including water treatment technologies and sinkhole monitoring.
9. Singapore steps up nuclear energy studies and safety capabilities
Singapore is expanding research, regulatory studies and workforce development as it evaluates nuclear power — particularly small modular reactors (SMRs) — as a potential low-carbon energy option. Authorities emphasised that no deployment decision has been made, with safety, technical feasibility and public confidence identified as critical prerequisites. Advances in compact reactors, which require less land and offer enhanced passive safety systems, have made nuclear energy more feasible for land-scarce Singapore. The government is also strengthening manpower and building expertise while monitoring regional developments, noting that successful deployment elsewhere could influence adoption.
Complementing this work, the National Environment Agency will commission three studies on nuclear safety and environmental impact. These will examine international safety standards for reactor design and operations, regulatory frameworks for nuclear facilities, and environmental considerations for potential deployment in Singapore and the region. The studies will complement ongoing assessments by the Energy Market Authority on advanced nuclear technologies. Singapore is also building capabilities through partnerships with international regulators and the International Atomic Energy Agency, enabling it to independently assess nuclear options and prepare for increased regional deployment.
10. Recommended content for this quarter:
Read: Subsea power cables are emerging as critical infrastructure to accelerate Southeast Asia’s energy transition by enabling cross-border electricity trade. However, Southeast Asia’s renewable potential is unevenly distributed, with countries such as Indonesia and Vietnam holding significant solar, wind and hydropower resources. Subsea transmission links can help export surplus clean energy to demand centres like Singapore, supporting regional decarbonisation while reducing reliance on fossil fuels.
Watch: Dan Kalafatas, Chairman and Co-founder of 3Degrees, a recipient of the Carbon Project Development Grant, discusses why they decided to set up in Singapore.
