Distinguished Guests,
Ladies and Gentlemen,
Introduction
1. A very good morning to you. Welcome to the 9th Asia Hydrogen and LNG Markets Conference, which is organised as part of the Singapore International Energy Week (SIEW).
The Current Landscape: Energy and Environment
2. The world currently faces two critical challenges in the area of energy, which Minister for Trade and Industry Gan Kim Yong talked about yesterday: turbulent energy markets and the global energy transition.
3. Last year, we saw significant fluctuations in LNG prices, driven by supply uncertainties caused by the conflict in Ukraine. Since then, pressures from structural shifts in the European and global gas supplies have eased substantially. Nonetheless, prices remain above their historical averages, and experts including those in this room, anticipate tight global gas supplies in the coming years. In addition, the ongoing conflict in the Middle East may lead us into yet another period of uncertainty. There are too many variables that we need to consider.
4. Meanwhile, governments worldwide are planning their journey towards achieving net-zero emissions. It is vital to ensure that their energy transitions do not compromise energy security. Hence, LNG remains a necessary transition fuel, allowing low-carbon technologies to mature and scale up low-carbon energy sources.
LNG: Transitioning to Tomorrow
5. LNG is the cleanest form of fossil fuels available today. Furthermore, it offers the stability and reliability needed for energy security, underpinned by its well-established infrastructure and global supply networks.
6. Singapore currently relies on natural gas to produce 95% of our electricity. To safeguard the security of our gas supplies, Minister Gan announced yesterday that Singapore will centrally procure and supply gas to our power sector. This move will guarantee a steadier and more secure gas supply as we diversify our sources and achieve greater economies of scale through bulk procurement. This will, in turn, contribute to more stable electricity prices.
7. Like many other countries, we expect LNG to remain a significant part of our energy transition. This is especially vital for Singapore, given our size and the challenges we face in adopting alternative energy sources. Until a cleaner, cost-competitive fuel that is backed by a global supply chain becomes available, LNG will remain a crucial component of our energy mix.
Hydrogen: Future's Promise
8. Hydrogen has certainly gained prominence recently as a frontrunner in the global quest for a more sustainable fuel. Low-carbon hydrogen has the potential to become a significant decarbonisation pathway to support our transition towards net zero.
9. During last year’s Singapore International Energy Week, Deputy Prime Minister Lawrence Wong announced not just our net-zero ambition, but also Singapore’s national hydrogen strategy to support Singapore’s international climate commitment to achieve net zero emissions by 2050. Allow me to share Singapore's progress in our hydrogen journey for the past year.
10. Firstly, we are working closely with industry to study the deployment of hydrogen in different sectors. Shortly after the National Hydrogen Strategy was announced in October 2022, the EMA and MPA invited proposal submissions under an Expression of Interest (EOI) to develop an end-to-end solution for using low-carbon ammonia in power generation and marine bunkering. This is an example of the Government coming in to catalyse and aggregate demand. We attracted substantial industry interest, receiving 26 proposals from local and international companies. Minister Gan also unveiled the steps to help move the project closer to fruition yesterday. It will establish Singapore as one of the first countries in the world to test and deploy the direct use of ammonia as a low-carbon fuel. This is an area that we are learning as we pilot and develop our concept.
11. We look forward to sharing our experience on our efforts in tackling climate change; how we intend to do better and refine our approach.
12. Beyond power generation and bunkering, the Civil Aviation Authority of Singapore is also working with the Changi Airport Group, Airbus and Linde to study the potential of using hydrogen in aviation. The study will look into the projected demand for hydrogen for the aviation sector in Singapore, the infrastructure needed to use hydrogen directly in aircraft, and the decarbonisation of airport operations using hydrogen fuel cells.
13. Secondly, as part of our national hydrogen strategy, Singapore contributes to international efforts to develop hydrogen supply chains. For hydrogen to become a globally traded commodity, like LNG, countries must work together and exchange views on policies, regulations, trade guidelines and emissions methodologies. To play our part, Singapore officially joined the International Partnership for Hydrogen and Fuel Cells in the Economy (IPHE) in May 2023. We also participate in discussions to finalise the Methodology for Determining Greenhouse Gas Emissions Associated with the Production of Hydrogen.
14. Thirdly, Singapore is doubling down on our R&D investments in low-carbon technologies. While industry and governments have demonstrated keen interest in hydrogen, hydrogen technologies are still in their early stages of development. More research is required to reduce costs to a level suitable for widespread deployment. With our grant calls, we aim to encourage collaboration between industry and academia to achieve new breakthroughs. We look forward to receiving high-quality proposals and strong industry participation in response to the variousgrant calls.
Conclusion
15. In conclusion, Singapore believes that LNG and hydrogen will play a central role in the global energy transition. To ensure a robust and stable global gas market and to drive the growth of the hydrogen economy, we need to invest in the upstream supply and to develop the energy infrastructure. Additionally, we must focus on enhancing the transparency of market trends, establishing coherent governmental policies and promoting innovative advancements. Only then can we fuel our progress towards a cleaner energy future.
16. On that note, I want to extend a warm welcome to all of you. I wish you a very productive conference ahead. Thank you.