Keppel Energy, Sembcorp Utilities and Tuas Power to supply biomethane in pilot project

[SINGAPORE] Keppel Energy, Sembcorp Utilities and Tuas Power Generation have been appointed to import and supply biomethane as a renewable alternative to natural gas as part of a 300 megawatt (MW) pilot project.

Plans to set up the biomethane regulatory sandbox was first announced in October last year during the annual Singapore International Energy Week run by the Energy Market Authority.

The sandbox will run for 15 years, with the three power generation companies expected to bring in their first biomethane supplies by end-2028, said the Economic Development Board (EDB) on Friday (Oct 23).

Under the sandbox, the generation companies will import biomethane – that could generate up to 300 MW of power – from regional and international sources, and supply it to data centres and industrial manufacturers in Singapore, either as biomethane gas or as biomethane-derived electricity.

This capacity can supply the energy needs of around 600,000 public housing flats annually.

Of the 300 MW, Keppel Energy and Sembcorp Utilities are each expected to import and supply up to 120 MW of biomethane, while Tuas Power will supply the remainder.

“The initiative, the first of its kind in South-east Asia, will help Singapore explore biomethane as a decarbonisation pathway and pave the way for its wider adoption,” said the EDB statement.

Unlike many emerging low-carbon fuels, biomethane is a direct drop-in replacement for fossil natural gas. This means it can utilise existing gas infrastructure and be consumed without modifications to equipment or industrial processes, making the clean fuel one of the most practical near-term decarbonisation options available, it added.

“With natural gas accounting for around 95 per cent of Singapore’s electricity generation, biomethane offers a feasible pathway to reduce emissions from the power sector and heavily gas-dependent industries,” said the statement.

In a separate media statement, Keppel said that the imported biomethane will be handled with natural gas as an aggregated fuel portfolio for Keppel’s advanced combined cycle gas turbine plants on Jurong Island, as well as supplied to end-use customers.

The lower carbon intensity power can then be supplied to both industrial and advanced manufacturers, as well as data centre operators, including Keppel, which was recently provisionally awarded 50 MW of new data centre capacity.

Keppel was one of four operators that were granted approval to expand their data centre capacity in Singapore via a call for application.

“This will not only help Keppel fulfil its sustainability commitments, but also support other customers in meeting their needs for commercially competitive decarbonisation solutions,” said Keppel’s statement.

Janice Bong, managing director for the integrated power business under Keppel’s infrastructure division, said that the company’s integrated energy capabilities, experience in natural-gas sourcing and procurement, as well as cross-border power importation can provide a strong foundation to help develop Singapore’s biomethane pathway.

“By consolidating demand for biomethane, we can achieve economies of scale and optimise costs, enabling wider adoption and decarbonisation across multiple sectors,” she added.

In another media statement by Tuas Power, its senior vice-president for fuel management Ida Handojo said that the company’s experience in South-east Asia’s biomass market and logistic handling can support Singapore’s journey to develop the use of biomethane at scale.

“Agriculture is, and will continue to be, a significant economic activity in South-east Asia, offering substantial potential for biofuel sources,” she added.

Koh Chiap Khiong, president and CEO of gas and related services at Sembcorp Industries, said that the appointment reflects Sembcorp’s ability to bring together fuel supply, market demand and customer solutions at scale.

“We are well-positioned to help develop Singapore’s biomethane value chain and support the adoption of this emerging fuel. In doing so, we can contribute to Singapore’s energy transition and help meet growing power demand from an increasingly digital and artificial intelligence-driven economy,” he added.