A plan to send solar power produced in Northern Australia via 4,200 kilometres of undersea cables to Singapore has been oversubscribed by about 50 per cent, based on a gauge of interest by the developer.
Australian energy firm Sun Cable said it received expressions of interest worth over 2.5 gigawatts of power from potential buyers in Singapore, based on the firm’s expected selling price, when its plan is to send over only 1.75 gigawatts (GW) of electricity.
Sun Cable co-founder Fraser Thompson declined to disclose the price offered at the sidelines of the Singapore International Energy Week (SIEW) event, but said the result showed “real demand” for renewable electricity from Singapore.
The firm is pitching its offering to industrial customers only, not Singapore households. Thompson said Sun Cable is able to offer contracts of up to 40 years for customers that want to avoid energy price volatility.
Sun Cable’s US$19 billion project, dubbed the ‘AAPowerLink’, is one of about 20 proposals energy firms have submitted to the Singapore government on importing low-carbon electricity to the city-state.
The Australian project competes with plans to send solar, wind, hydro and geothermal power to Singapore from Indonesia, Laos, Malaysia and Thailand. The Singapore government wants to import 4 GW of electricity from low-carbon sources overseas by 2035, as part of its efforts to go green.
Despite suggesting what is potentially the longest transmission distance of all the proposals, Thompson said the AAPowerLink project can be cost competitive because the sun shines a lot stronger in Northern Australia, where the solar panels are to be built. The firm will use the latest high-voltage transmission cables to minimise electricity loss.
“We couldn’t have done this five years ago, because we would have lost too much electricity in transit,” Thompson said.
Sun Cable is also planning to make the solar facility in Australia very big, at 12,000 hectares of panels, which would help the project enjoy economies of scale. The facility will also supply about 800 megawatts of electricity to local offtakers.
Thompson added that collaboration between the Singapore and Australia governments is strong. The AAPowerLink project was cited last week when both countries inked a deal to work on sustainability-themed projects together.
AAPowerLink is one of eight projects the Australian government deems to be of national importance that is ready to accept funding. It had been on Australia’s list of priority developments since early-2021.
Australia, under a new government since mid-year, wants to brand itself a clean energy powerhouse.
Indonesia and Malaysia, meanwhile, have announced bans on the export of renewable energy.
Thompson said Sun Cable is looking to finish building the project as early as possible, and is currently looking at a completion date around 2030. Past company publications have said electricity transmission to Singapore could start in 2027.
The project involves routing undersea cables through Indonesian waters. Marine surveys are expected to be completed early next year. Thompson said he is “happy” with the progress on seeking approval from Indonesia to lay the cables.
“Political support has been very strong,” Thompson said of Indonesia.
Sun Cable has said the megaproject will create thousands of jobs for Indonesia, along with billions of dollars of investments for building materials and maintenance.
The firm is working to secure the funding needed to start work, which Thompson said will be a combination of equity, debt and government financing.
Green grids community
Sun Cable also launched a new industry network focused on studying electricity grid technology in Asia at SIEW.
The group consists of Singapore infrastructure firm Surbana Jurong, which is a partner in the AAPowerLink project, Singapore national research lab A*Star, as well as seven Singapore and Australia universities.
It will focus on improving renewable energy generation, electricity grids and energy storage technologies.
Sun Cable said that if Asia Pacific is able to connect 15 per cent of country grids by 2040, nearly US$500 billion worth of electricity could be traded each year, and some 870,000 jobs could be created. Regional grids will also boost the development of renewables, spurring the transition away from polluting fossil fuels, it added.
The network will not look to finance regional grid projects, but members are encouraged to put in research money, Thompson said, adding that Sun Cable will be contributing such funds.
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