Authorities looking into deploying renewable energy on larger scale

EMA conducting review of regulatory framework for intermittent energy sources
Siau Ming En Today Online 29 Oct 13;

SINGAPORE — In future, it could be easier for smaller consumers with intermittent energy sources — such as schools, factories and warehouses — to be paid for supplying excess electricity that they generate to the national grid.

How this will be done is being worked out in a review of the regulatory framework that the Energy Market Authority (EMA) is now conducting, said Second Minister for Trade and Industry S Iswaran, at the start of the Singapore International Energy Week yesterday. A public consultation on the framework was also launched yesterday.

Intermittent generation sources are those whose output depends on environmental factors and weather conditions. Examples include solar and wind energy.

As renewable energy grows as a commercially-viable energy source for Singapore, the review will help to prepare for integrating such renewable energy options into the electricity market eventually without affecting grid stability, said Mr Iswaran.

One of the first changes to ease the entry of intermittent energy producers into the market is the raising of the supply cap to the grid. Instead of the current “hard cap” of 350MWp, producers will be able to supply 600MWp to the grid, said Mr Iswaran, who is also Minister in the Prime Minister’s Office and Second Minister for Home Affairs.

“That’s a significant move, because when you incorporate renewables with their intermittency and so on, the need for back-up and reserve capacity is even greater ... The main signal we are sending here is that the system has the capacity to accommodate renewable energy introduction,” he said.

The EMA will continue to explore “how best to procure and cost in reserves to manage this intermittency”, he added.

On another front, a Demand Response scheme will also be rolled out in 2015, following a consultation process that was launched last year, said Mr Iswaran.

The scheme, which allows larger consumers — those that consume over 10,000KwH of electricity every month, such as commercial and industrial users — to monitor prices of energy and adjust their usage accordingly, aims to encourage them to optimise their energy use. Those who stand to benefit, for instance, are those with flexible production processes and can choose to temporarily switch off specific non-critical production equipment, or consumers who can reduce their electricity demand by running their back-up generators for short periods,

“This can moderate price spikes, lower energy costs and generate system-wide savings. These savings will then be passed through to consumers who curtail their demand,” said the minister. According to the EMA, these consumers make up about 75 per cent of electricity demand here.

Demand Response providers will also benefit from the scheme — they will receive incentive payments amounting to one-third of savings when electricity prices fall because of lower demand.

Mr Iswaran encouraged these providers to approach their customers and equip them with the technical requirements to participate in the scheme in the interim.

More details of the scheme will be released at the SIEW this week.

Authorities reviewing rules on energy sources such as solar power
Singapore is also looking to launch an electricity futures market in the second half of next year
Siau Ming En Today Online 29 Oct 13;

SINGAPORE — The Energy Market Authority (EMA) is looking at the possibility of making it easier for consumers with their own sources of generating energy –- such as solar power –- to be paid for supplying the excess energy they generate to the grid.

These are smaller consumers that consume less than 1MW of electricity per month, and include schools, factories and warehouses.

This will be part of a public consultation on the regulatory framework for intermittent generation sources – which includes solar energy – which was announced today by Second Minister for Home Affairs and Trade and Industry S Iswaran (Oct 28) at the Singapore International Energy Week (SIEW).

In his opening remarks at the event, Mr Iswaran said the review is to facilitate greater distribution of renewable energy sources and help them integrate into the current electricity market.

The EMA will also raise the hard cap on the amount of intermittent generation sources that can be supplied to the grid, from 350MWp to 600MWp. The public consultation will conclude in January next year.

Mr Iswaran also announced that the EMA will roll out a Demand Response scheme in 2015, following a consultation last year to include the scheme as part of Singapore’s electricity market. The scheme will allow consumers to monitor prices of energy and reduce their electricity usage when prices are higher, for example. The EMA will release more details of the scheme later at SIEW this week.

Singapore is also looking to launch an electricity futures market some time in the second half of next year, which will allow industry players to trade contracts of electricity products at specified prices. Mr Iswaran said that six generation companies in Singapore have expressed interest in collaborating with the Singapore Exchange to develop the electricity futures market here, following the launch of the consultation paper at last year’s SIEW.

SGX to launch electricity futures market
Siau Ming En Today Online 29 Oct 13;

SINGAPORE — The Republic is poised to launch an electricity futures market in the second half of next year, said Second Minister for Trade and Industry S Iswaran yesterday.

The futures market, which will support the trading of electricity products in the future at specified prices, will help big consumers of electricity — typically malls and companies in the manufacturing and pharmaceutical sectors — better manage price volatility by allowing them to secure longer-term prices, he said.

“A futures market will also provide an alternative avenue for independent retailers to enter the market by enabling them to purchase longer-term hedges. The entry of such independent players can, in turn, further spur retail competition to the benefit of end-consumers,” Mr Iswaran added.

For instance, the futures market will provide independent retailers the option to secure fixed price contracts and offer competitive packages to the consumers.

Six power-generation companies — including Senoko Energy and Tuas Power Generation — have also expressed interest in working with the Singapore Exchange (SGX) to develop the futures market, said Mr Iswaran, who is also the Second Minister for Home Affairs.

The idea of such an electricity market was first mooted by the Energy Market Authority (EMA) in 2006, with a public consultation exercise launched last year.

Asked about possible speculative activity in the futures market, Mr Iswaran replied that rules and how various players participate in the electricity market will be “carefully structured” to ensure stability. The EMA added that safeguards, such as price limits, are in place by SGX to prevent speculative activity.

Commercial discussions for the development of the futures market are currently under way.

An industry workgroup is also helping the industry draw up electricity futures contracts, as well as ensuring sufficient liquidity for the trading of electricity futures — which means the electricity futures contract can be traded without causing significant changes in the prices.

SGX is working with the industry to launch a trial of the electricity futures market next year, to allow the power-generation companies to build up competencies and experience in trading.

Singapore to review regulatory framework for intermittent sources: Iswaran
Nicole Tan Channel NewsAsia 28 Oct 13;

SINGAPORE: Besides the proposed formation of an electricity futures market, two other initiatives were announced at the Singapore Energy Summit on Friday.

Second Minister for Trade and Industry, S Iswaran, said Singapore will be reviewing its regulatory framework for intermittent generation sources.

The supply of these sources of energy is not continuously available due to factors that cannot be controlled, such as solar energy.

The cap on the amount that intermittent sources can supply to the power grid will be raised from 350 mega-watt peak to 600 mega-watt peak. This is to facilitate the shift towards renewable energy.

Meanwhile, a demand response scheme will be implemented to allow industry consumers to curtail energy demand when prices are high.

The scheme is expected to commence in 2015.

Mr Iswaran said: "Our objective is to foster a more competitive electricity market, ensure that our end users have got more choices, and have options to structure a portfolio for electricity demand that gives them diversification and therefore hopefully less volatility.

“So whether it's demand response, whether it's electricity futures, for both the supply side and demand side this creates an important market structure."

- CNA/gn

SGX to launch energy futures market by end-2014
Nicole Tan Channel NewsAsia 28 Oct 13;

SINGAPORE: The Singapore Exchange (SGX) has announced plans to launch an electricity futures market by end-2014 -- potentially Asia's first. The move aims to boost retail competition in Singapore's electricity market.

The development of an electricity futures market was announced by Second Minister for Trade and Industry, S Iswaran, at the Singapore Energy Summit on Monday.

Later, the SGX said in a statement that the futures market will help electricity generating companies and other market participants improve asset optimisation and better manage risks.

Mr Iswaran said: "A futures market will also provide an alternative avenue for independent retailers to enter the market by enabling them to purchase longer-term hedges. The entry of such independent players can in turn further spur retail competition to the benefit of end-consumers."

Six power generation companies have indicated interest in working with the SGX to develop the futures market as market makers. They include Senoko Energy, Keppel Merlimau Cogen, Sembcorp Cogen, Tuas Power Generation, Tuaspring, and YTL PowerSeraya.

The SGX is also working closely with the Energy Market Authority, the Energy Market Company and market players to design the futures contract. It is also working out an arrangement with potential market makers to ensure sufficient liquidity for the trading of electricity futures.

"Our objective is to ensure that these sorts of electricity futures contracts complement the existing contracts that already exist in the spot market in order to create greater stability in our electricity market for suppliers and consumers alike. So we would want to make sure that the rules and the way various players participate in this market are carefully structured," added Mr Iswaran.

SGX also plans to launch a trial run for the futures market to allow companies to gain experience in trading. The targeted launch is expected to be some time in the second half of 2014.

- CNA/ac

Plan to boost solar power without destabilising grid
Feng Zengkun and Grace Chua Straits Times 29 Oct 13;

SOLAR power may be environmentally friendlier than energy derived from coal or gas, but its unreliability could lead to blackouts and power disruptions.

This is why as Singapore ramps up its use of solar panels, the Government is taking steps to ensure that solar power will not risk destabilising the national power grid even if it contributes more electricity to it.

On the first day of the Singapore International Energy Week yesterday, it announced various measures to promote the use of intermittent energy sources, such as almost doubling the cap for power generation here from such sources.

These sources cannot be controlled at will since the amount of energy generation depends on factors such as the weather.

In Singapore, the only intermittent energy source connected to the national grid is solar power.

Opening the week's Singapore Energy Summit, Minister in the Prime Minister's Office S.Iswaran launched a consultation paper to seek views on proposed changes to the rules governing such sources here.

Among the proposed changes: a simpler registration process for people with small intermittent energy generators such as solar panels.

The Energy Market Authority (EMA) is also considering allowing intermittent energy sources to supply more power to the grid.

Currently, they can supply no more than 350MW, which is about 5per cent of last year's peak electricity demand. Solar panels installed here as of June this year can generate at most about 12MW.

The cap lessens the impact on the grid in case, say, sudden cloud cover causes solar panel output to drop quickly. Reserve power from traditional sources is therefore needed to ensure stability.

However, the EMA noted that the cap may restrict the installation of intermittent energy sources in future.

It proposed an alternative and flexible system.

"But as a first step, the cap will be raised to 600 (MW), in view of our current reserves," said Mr Iswaran.

The EMA also plans to allow large consumers to voluntarily cut their electricity demand for short periods in response to high prices during peak usage to help lower their energy costs and reap other benefits.

The change is expected in 2015.

Mr Iswaran, who is also Second Minister for Trade and Industry, also announced plans to test a futures market for electricity early next year.

If the trial is successful, a futures market will be set up in the second half of the year.

Six power generation companies - Keppel Merlimau, Sembcorp, Senoko Energy, Tuas Power Generation, Tuaspring and YTL PowerSeraya - had already signed on to work with the Singapore Exchange to develop a futures market, Mr Iswaran said.

But the futures market will be carefully structured, he added. "We do not want it to become the object of speculative activity and we're quite clear about that."