Singapore and Indonesia deepen green energy partnership with three new deals

Singapore and Indonesia have inked three key agreements to strengthen cooperation in clean energy and sustainable development, in a “win-win partnership” that marks a significant milestone in their green partnership.

The memorandums of understanding were inked on 13 June during a visit to Jakarta by Singapore’s Minister-in-charge of Energy and Science and Technology, Dr Tan See Leng, and Indonesia’s Minister for Energy and Mineral Resources, Dr Bahlil Lahadalia.

Describing the agreements as a step forward in the two countries’ shared vision for a low-carbon and resilient future, Dr Tan said the deals were mutually beneficial.

“Today’s signing ceremony is not just symbolic. It is a true reflection of both our shared resolve to translate our ideas into actions and to do so in close partnership and mutual trust,” he said in
a speech.

The agreements, Dr Tan added, “offer win-win opportunities” amid global climate challenges and economic uncertainty. They aim to grow and decarbonise both countries’ economies in a sustainable way, spur innovation, and unlock new growth areas. “These are a concrete step to anchor long-term cooperation,” he said.
 

One of the cornerstone agreements targets cross-border electricity trade. This builds on earlier energy cooperation frameworks and aims to develop the necessary policies, regulatory mechanisms, and commercial terms within a year.

Dr Tan noted that the projects under this initiative could attract significant capital investment, boost foreign exchange earnings, and increase annual tax revenue.

He added that electricity exports would also accelerate the growth of Indonesia’s renewable energy manufacturing sector and enhance its broader supply chain, creating jobs and drawing long-term investment.

“Together, Singapore and Indonesia, we are also laying the foundation for a more connected ASEAN power grid and a more secure and sustainable energy future,” he said, referring to the initiative to connect energy systems across Southeast Asia. Another agreement focuses on collaboration in carbon capture and storage (CCS). A joint working group will be formed to explore a legally binding bilateral agreement to facilitate project implementation.

Calling CCS “necessary for the decarbonisation of hard-to-abate economic activities” in both countries, Dr Tan said such a move could create a major new business opportunity for Indonesia while creating jobs and attracting investments.

“It is not a new technology, but if Indonesia and Singapore can succeed in making this cross-border CCS a reality, we will be among the first countries in Asia to do so,” he said.

Southeast Asia, he added, has the potential to store up to 133 gigatonnes of carbon dioxide permanently. Singapore’s 2 million tonnes-a year project could serve as a “pathfinder” for Indonesia, which aspires to be a regional CCS hub.
 

The third agreement supports the development of a sustainable industrial zone (SIZ) in the Bintan, Batam, and Karimun region – known collectively as BBK – near Singapore. A joint task force will identify potential industries to be developed in the area.

“This builds on the many years of cooperation we have between Singapore and Indonesia to attract investments into BBK,” said Dr Tan.

He added that the renewed commitment to energy and carbon collaboration projects in BBK would help catalyse more industrial activities in Indonesia.

Singapore’s Ministry of Trade and Industry (MTI) said the SIZ agreement underscores the importance both governments place on regulatory clarity for renewable energy ventures, which could in turn attract green investments into Indonesia.

Further implementation details and expected outcomes will be announced at a later date, the ministry added. Dr Tan wrapped up his speech by underlining the importance of regional collaboration.

“As the saying goes, if we want to go far, we must go together. Singapore remains committed to working with Indonesia and other partners to support one another’s journey to net zero. Let us continue to collaborate in good faith, to develop new opportunities for innovation, cooperation, and partnership.”

Similarly, Indonesia’s Dr Bahlil emphasised the importance of collaboration in his speech, noting that today was “a historic moment” in fulfilling the commitment between the Singapore and Indonesia governments on green energy cooperation. No industrial product can remain globally competitive unless it adopts the latest energy technologies and operates close to green industry standards, he said.

“There is one key principle: we provide electricity to our brothers and sisters in neighbouring countries, but they must also collaborate with us to build industrial zones in Indonesia. That is what true cooperation means,” he said.

Source: The Straits Times © SPH Media Limited. Permission required for reproduction.