Trading of goods is happening all the time between countries. Some trade raw materials, other processed goods. But I can bet you've never heard of countries selling electricity to each other.
Well, Singapore has announced on October 26 that it will 'import' electricity from Malaysia under a two-year trial.
Singapore's Energy Market Authority (EMA) said it aims to "assess and refine the technical and regulatory frameworks" for importing electricity.
EMA added, "To meet our climate change commitments, there is a need to change the way Singapore produces and uses energy. Tapping on regional power grids for cleaner energy resources is one strategy to further diversify Singapore's energy supply."
Singapore's Minister of Trade and Industry Chan Chun Sing said that this move is to improve the regional grid architecture.
"We will kick this off by importing 100 megawatts (MW) of electricity imports for a trial period of two years, to see how the market works.
"This will allow the region to share the clean energy sources that different countries may have, and we'll start this with Malaysia. Once the concept takes off, we'll be able to extend this to other regional players." Chan said.
EMA will start by importing 100 megawatts of energy from Malaysia for the next two years. Both countries will begin trading electricity as early as end-2021 through an electricity interconnector between both the countries which already exists.
Singapore is also looking for importers which the EMA will select through a 'competitive' selection process.
EMA also said, "Potential importers will have to demonstrate their supply reliability, credibility and track record, ability to secure demand from Singapore consumers, and manage the carbon output of generation supply."
Talks of electricity trade have been going on since 2019 to ensure energy security between the Southeast Asian countries. The ultimate goal: Creating a secure, reliable, and sustainable energy grid in the region.
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