Malaysia-Singapore green power trade needs balanced returns, says Ditrolic
The renewable energy developer says export pricing must meet buyers’ affordability needs while providing adequate returns for exporters.
Malaysia and Singapore need to reconcile their economic priorities for cross-border renewable electricity trade to endure, Ditrolic Energy CEO Tham Chee Aun said at the Singapore International Energy Week on Oct 27.
Tham said pursuing the highest export price would not necessarily produce the best outcome. Instead, pricing should give exporters adequate returns while remaining affordable for buyers, with benefits sufficient to sustain arrangements over the long term.
Malaysia wants to capture economic value from its renewable resources, while Singapore seeks low-carbon imports at competitive prices to support its environmental goals. Tham said differences between Singapore’s more competitive electricity market and Malaysia’s more vertically integrated system complicate that balance.
Demand at Malaysia’s auctions for grid-pooled renewable electricity exports to Singapore has fallen short of expectations. Pricing and the electricity’s origin in a grid carrying fossil fuel-generated power have been cited as concerns affecting interest.
Malaysia removed its renewable electricity export ban in 2023 and has since completed a pilot auction through Energy Exchange Malaysia (ENEGEM). The electricity was pooled through the national grid by Single Buyer, a ring-fenced unit of Tenaga Nasional Bhd.
Tham said customer requirements would ultimately determine the market’s development. Buyers may prioritise renewable electricity available around the clock, supported by storage, and visibility over long-term prices rather than simply seeking the cheapest supply. Ditrolic is among Malaysian companies developing Johor solar farms for exports to Singapore.
