Singapore: Challenges and new impetus in the energy transition

published on October 27, 2025

Singapore sees itself as a highly modern, strongly developed economy that, with its long-standing political stability, business-friendly regulatory framework, and innovation-driven economic policy, is specifically geared toward free trade, investment promotion, and digital transformation. The city-state is currently pursuing ambitious climate targets and strategies as part of the Singapore Green Plan, which also includes a so-called “energy reset.” The goal is the cross-sector use of clean energy sources. Singapore is around 95% dependent on imported fossil fuels. This dependence on imports makes energy supply costly and vulnerable to crises. Diversification through renewable energies and storage technologies is therefore becoming increasingly important for the country from a strategic perspective.

Challenges for alternative energy sources

Several factors pose significant hurdles to the expansion of renewable energies in the city-state. Singapore's small size (734 square kilometers), geographical conditions including resource scarcity, high population density, and land scarcity limit the potential for more sustainable energy sources. This means that the safe use of nuclear energy or the realization of the potential of domestic biomass is practically impossible. Without geothermal energy sources, there is also no possibility of using geothermal systems. Singapore's low tidal range limits the possibilities for commercial tidal power use. A large part of the sea area is used for ports, anchorages, and shipping lanes, which limits the application of offshore technologies. The potential of hydropower cannot be exploited either, as Singapore does not have a river system with fast-flowing water all year round. Singapore's geographical location also poses a challenge for commercial wind turbines. While commercial wind turbines operate at wind speeds of over 4.5 m/s, Singapore's average wind speed is only about 2 m/s.

Singapore's electricity mix

Energy source	Electricity generation in 2024
Coal	0.57 TWh
Oil	1.17 TWh
Gas	54.93 TWh
Nuclear	0.00 TWh
Solar	1.28 TWh
Wind	0.00 TWh
Hydropower	0.00 TWh
Bioenergy	1.66 TWh
Total	59.61 TWh

Source: Singapore: Energy Country Profile - Our World in Data

Singapore continues to cover most of its energy supply with imported fossil fuels. Around 95% of the energy mix consists of liquefied natural gas (LNG) and oil, which means that the city-state remains highly dependent on international supply chains. The contribution of renewable energies has been low so far: only about 3% of electricity production currently comes from renewable sources, almost exclusively from photovoltaics. Singapore is located near the equator and has a relatively high level of solar radiation of 1,580 kWh/m²/year. By comparison, in Germany this figure is around 1,100 kWh/m². In Singapore, the past few years have seen remarkable momentum in the expansion of solar energy. Between 2015 and the end of 2023, installed capacity has increased almost eightfold, from around 125 MW to just under 950 MW. The government has set itself the goal of achieving a capacity of at least 2 GWp by 2030 in order to meet the annual electricity needs of around 350,000 households and cover around ten percent of today's peak consumption. Real-time information on the solar energy generated in Singapore can be found on the Solar Irradiance Map on the Energy Market Authority (EMA) website.

To overcome the shortage of space, Singapore is relying on innovative concepts such as floating solar installations (e.g., at the Tengeh Reservoir), solar roofs on industrial buildings, schools, and warehouses, and solar carports in urban areas. To compensate for the natural fluctuations in electricity generation from solar energy and ensure grid stability, Singapore is relying on large energy storage systems (ESS). The commissioning of an ESS on Jurong Island in February 2023 marks an important milestone. With a capacity of 285 megawatt hours, it is one of the largest projects of its kind in Southeast Asia.

Regional cooperation and new technologies

Regional exchange is a key pillar of Singapore's future energy supply. By 2035, the government plans to cover around 4 GW of electricity through green energy imports – which corresponds to around 30 percent of national demand. Corresponding projects with Malaysia, Indonesia, Laos, and Australia are already in development. In the long term, Singapore is pursuing the vision of a Southeast Asian power grid (“ASEAN Power Grid”) that uses renewable energy sources where they can be generated efficiently and enables cross-border trade.

At the same time, green hydrogen is increasingly becoming a strategic focus. Even though the market is still in an early pilot phase, Singapore wants to take on a key role as an import, processing, and distribution center—both for industry and the transport sector and as a seasonal energy storage facility. Initial initiatives are already underway: demonstration projects on hydrogen mobility and power-to-gas infrastructures on Jurong Island mark the technological testing phase.

This transformation process is being accompanied by a national CO₂ pricing system, which was introduced in 2019 as the first of its kind in Southeast Asia. The initial rate was SGD 5 per ton of CO₂, but this was increased to SGD 25 (around EUR 17) in 2024 and is set to rise to between SGD 50 and SGD 80 by 2030. This affects around 80 percent of national emissions, primarily from industrial plants with emissions of more than 25,000 tons of CO₂ per year. The revenue from the tax flows into climate-related support programs and thus also directly serves to finance the energy transition.

Conclusion

Singapore faces considerable structural challenges in the energy transition. Nevertheless, the city-state is pursuing ambitious climate targets, focusing specifically on technological innovations, regional cooperation, and market-based instruments such as CO₂ pricing. Solar energy, supplemented by storage systems, is currently the key lever for diversifying the energy mix. In addition, green electricity imports and hydrogen projects are opening up new prospects for a more sustainable supply in the long term. The city-state is thus demonstrating that, despite complicated conditions, it is consistently developing strategies to make its own energy supply future-proof and climate-friendly in line with the Singapore Green Plan.