Green Finance & Investments

New on-demand rooftop solar investment platform

Image: Eneco Group, Flickr

Legends Rooftop is an online tool that allows investors to purchase off-site rooftop solar panels as a financial investment.

From pv magazine USA

Startup Legends Solar has unveiled a new early-access product, Legends Rooftop, which is an online, on-demand solar investment platform. The platform allows people to purchase anywhere from one solar panel to an entire array on a remote commercial rooftop. It is pitched as a way for millennial investors to access the benefits of solar.

Users select how many panels they want to invest in, with the smallest investment starting at a few hundred dollars. The platform tracks the performance of the panels and banks the energy savings created by the solar project in the user’s account. Withdrawals can be made at any time, said Legends Solar.

The company said there are some risks in the investment, including poor weather conditions, failure of payment by the “offtaker” or power purchaser, unexpected maintenance, or natural disasters and physical damage. It said that hospitals and universities are usually very consistent offtakers.

“With Legends Solar, you can invest in a single remotely located panel, or a whole rooftop’s worth, even without the suburban minimansion and white picket fence,” said Legends Solar CEO Lassor Feasley.

SDC Energy will serve as a financial partner for Legends Solar. The company has performed hundreds of solar financings in the past.

“The team at Legends Solar has challenged us to reimagine our approach to raising equity for new solar facilities,” said SDC Energy President Charles Schaffer. “We look forward to unlocking the solar asset class for a wider and more diverse set of retail investors. By doing this, we will accelerate the transition to a carbon free society and spread its financial benefits more equitably.”

The tool tracks solar production, the amount of carbon abated, total cash earned, and dividend payments.

Author: Emiliano Bellini

A fast-changing renewables PPA landscape

Structured PPAs are becoming more common in mature PV markets, where risks are shared. Image: Axpo Solutions

Power purchase agreements are ideal risk-management tools, given that electricity price volatility is the new normal and renewables uptake is a matter of urgency due to untenable Russian gas dependency. pv magazine sat down with Andy Sommer, team leader of fundamental analysis and modeling at Swiss trader Axpo Solutions, to discuss the situation of prices and PPAs in Europe.

From pv magazine 05/2022

Wholesale electricity prices in Europe have been rising – a trend which started before the war in Ukraine, but is no doubt exacerbated by it. How long will it continue?

It’s impossible to tell of course, nobody has a crystal ball and under current conditions predicting in the near term, let alone the more distant future, is risky. It’s a basic liability issue. But we can understand the many different factors, including how long Russia’s war against Ukraine lasts, and whether imports of Russian gas by Europe (and potentially other relevant countries, especially in Asia) will eventually be banned. The weather in Asia and the Americas, and the availability of replacements for Russian coal in Europe/Japan are other factors which could contribute to continued price increases.

The medium-term development is important for those planning and building PV power plants. What do you expect for wholesale electricity prices in the medium term (five to 10 years)? Can PV investors rely on higher revenues?

As mentioned, the short-term outlook for Europe’s electricity prices is almost impossible to judge right now. Neither can we predict with any certainty whether politicians are going to intervene further in the markets, affecting how fast renewable power generation capacities can expand, for example.

Assuming that PV and wind will continue to be built quickly (supported either by subsidies or favorable market conditions), that the phasing down of coal and nuclear continues as scheduled, and the general energy transition progresses, we believe wholesale market prices will decline substantially in the mid-term versus current levels. This would be due to the presence of more renewable energy sources (RES) in the system, reducing the need for low-efficiency thermal plants, and a significantly less tight gas market (with increasing volumes of LNG coming online around 2025) more than compensating for higher carbon costs.

In the long term, factors such as the cost of investment in carbon capture, utilisation and storage and green hydrogen technologies could become a stabilising influence. Nevertheless, as long as Europe is dependent on LNG imports to cover its gas needs, the market will remain dependent on weather, as well as economic and political conditions in Asia and other regions of the world.

Axpo is a major PPA offtaker in Europe. What does electricity price volatility mean for new solar PPA prices and contracts?

The risks associated with PV development through PPAs have not changed; they always existed. However, we are now seeing most of them under an unprecedented spotlight, including factors such as electricity price volatility, regulatory uncertainty, CPI shocks, transportation difficulties, and permitting delays, among others.

PPAs as risk mitigation tools are adapting to this new reality with more flexible approaches to cope with potential delays, more short-term contracts to capture temporary price spikes, floor structures to leave potential price upsides within the project developer, and more structured approaches to capture higher prices, such as baseload hedges instead of traditional pay-as-produced contracts, and more.

PV plants with a PPA business model don’t need subsidies. Considering that electricity prices are high, what limits the growth of this sector?

Current limits include the not-in-my-backyard or the NIMBY social phenomenon, the limitations of electricity grid infrastructure, and sometimes complex, lengthy and bureaucratic approval/permitting processes, although these hurdles are now beginning to be addressed politically.

The PV-PPA market in Spain is probably the most mature in Europe. What can other countries learn from there?

We have seen the Iberian PV-PPA market evolve over a very short period of time. We started with traditional pay-as-produced structures, in which the producer is paid a fixed price for the full production of a power plant. It was an environment where there was little demand for buying power long-term, and PPAs were seen as an alternative to pay-as-produced feed-in-tariffs.

In a more mature market with many different players, we now see more structured PPAs, where risks are not only borne by the off-taker, but also shared between the two parties. It makes a lot of sense, since pay-as-produced contracts provide very limited returns on the investment and are only suitable for very risk-averse investors. Higher ROIs are still achievable in more sophisticated PPA structures with shared risks, which should be suitable for investors with greater market knowledge and experience.

Does the uncertainty of electricity price instability make PPAs more attractive?

It most certainly does. PPAs are risk management tools that enable developers to secure their investments. These contracts are adapting to different investor needs and market views.

Indonesia eyes subsidies, nuclear power in renewable energy Bill

The Bill seeks to ensure all Indonesians have access to power and to entirely transition to renewable energy by 2060. Image: AFP

From Bloomberg

JAKARTA – Indonesia, the biggest thermal coal exporter, vowed to subsidise renewable energy projects and open its first nuclear power plant by 2045 in a draft legislation to help it reach its net-zero emissions goal.

The Bill, which still needs approval from President Joko Widodo and Parliament before becoming law, seeks to lead the country on a path that would both ensure all 270 million residents have access to power while also making the country entirely reliant on renewable energy by 2060.

The draft sets out a strategic outline, with more detailed rules to be issued later.

Officials have their work cut out for them, as the nation with the world’s fourth-largest population also has one of the world’s smallest wind and solar power fleets. Indonesia relied on fossil fuels for 86 per cent of its electricity in 2020, according to BloombergNEF.

Here are a few key issues in the latest draft of the Bill, which will soon be discussed by the government:

Export tax

Indonesia will prioritise local demand before allowing renewable energy to be transmitted overseas, with exporters required to pay a tax. The stipulation would follow a ban by nearby Malaysia, and could hamper neighbouring Singapore’s plan to import clean electricity. The focus on domestic use also applies to the coal sector, where miners will have to set aside at least 30 per cent of their output for local consumption at a ceiling price of US$70 (S$96) a tonne for high-quality coal, compared with current global prices around S$400 a tonne.

Funding incentives

The government will give incentives, including tax and administrative ones, to support new projects. It will also subsidise renewable energy when the cost of producing it is unable to compete with fossil fuels. A renewable energy fund will collect money from the state budget, export taxes, carbon trading funds and other sources, then use the cash to build infrastructure, give incentives for developers or to support research.

Nuclear power

Indonesia will set up a nuclear power assembly that will monitor the development and operation of atomic plants. Only state-owned companies would be allowed to build, operate and shut such plants. The country plans to operate its first one in 2045.

Coal reliance

The Bill differentiates between “renewables” – wind, solar, geothermal, hydropower, biomass and a few other small technologies – and “new energy”, which includes nuclear, hydrogen and several coal-based technologies, while carving out room for both to aid in the transition. Indonesia is building its first coal gasification plant that will start operating in 2024.

Local impact

The government seeks to ensure renewable energy investments would benefit surrounding communities. Companies must prioritise the use of local workers as well as domestically sourced materials, while investors are expected to transfer their technology to local workers. Companies must also prevent pollution and have recovery plans in place if their operations lead to environmental damage.

3 ways to speed up Singapore’s transition towards a green future: Grace Fu

Minister for Sustainability and the Environment Grace Fu highlighted three ways Singapore can accelerate sustainability and climate action. Image: ST FILE

From The Straits Times

SINGAPORE – The Republic must keep up the international momentum in addressing the threat of climate change amid pressing priorities such as the Covid-19 pandemic, rising inflation and geostrategic challenges, said Minister for Sustainability and the Environment Grace Fu on Tuesday (June 7).

Speaking at the gala dinner of Temasek’s annual sustainability conference – Ecosperity Week – Ms Fu highlighted three ways the nation can accelerate sustainability and climate action.

1. Catalyse action towards inclusive transition

As the carbon tax is progressively raised to $50 to $80 per tonne by 2030, the revenue will support the transition to a greener economy through incentivising low-carbon solutions and cushioning the impact on businesses and households.

Businesses increasingly recognise the opportunities in the circular, low-carbon economy, while the choices of individuals can also play a role, said Ms Fu.

“Individual action may feel insignificant and is indeed insufficient. However, our collective actions will enable us to achieve our ultimate common goals,” she added.

If consumers avoid disposables, buy locally farmed vegetables and fish, and choose energy-efficient appliances, for instance, these choices will create ripple effects that accelerate the development of more sustainable products.

From the middle of next year, large supermarkets will implement a disposable bag charge, which aims to encourage the public to use reusable bags and be more judicious in their use of disposables.

2. Unlock more sustainable solutions

Technologies and solutions to decarbonise still remain out of reach or are not yet commercially viable, but industry collaborations can bring about new solutions, said Ms Fu.

Last month, Singapore joined the First Movers Coalition with eight other nations, which will allow companies to harness purchasing power and supply chains to create early markets for innovative low-carbon technologies.

This serves as a launchpad for them to reach commercial scale and could open doors for local businesses to innovate with like-minded partners.

Ms Fu also cited the Jurong Island Circular Economy study last year, which analysed the energy, water and chemical waste from 51 companies on the island.

The study has provided insights on how to reduce resource use and boost Jurong Island’s competitiveness and sustainability.

A new research institute focusing on how to shrink the carbon footprint of the industrial sector – responsible for about 60 per cent of the country’s total emissions – was also set up on Jurong Island earlier this year.

One focus area of the Institute of Sustainability for Chemicals, Energy and Environment is on reducing or removing planet-warming emissions.

This can be done through carbon capture, utilisation and storage technologies – which aim to capture greenhouse gases released from industrial processes before they reach the atmosphere, and then either convert them into useful substances, such as chemicals or store them underground.

The institute was set up by the Agency for Science, Technology and Research, which is working with industrial partners and other government agencies to study and plan for the development of a carbon capture and utilisation translational test bed on Jurong Island.

3. Specialise in green finance and carbon services

Ms Fu noted that Singapore is highly disadvantaged by its lack of natural renewable energy sources, as it does not have large rivers to draw hydropower or vast lands for wind turbines.

But with its reputation as an international financial hub, it is well placed to support countries with untapped natural renewable energy sources through the trading of carbon credits, she added.

For example, polluting companies can buy carbon credits from a renewable energy plant to offset and compensate for their own emissions.

And with the Article 6 rulebook on international carbon markets finalised at the United Nations Climate Change Conference last year, Singapore can help propel the growth of green finance and carbon services in the region, said Ms Fu.

“This will enable businesses to access the capital they need to innovate, operationalise, and scale their green projects,” she added.

In March, Singapore and Indonesia inked a partnership, where they will collaborate on carbon pricing and markets, and also explore financing solutions in carbon credit projects.

Author: Shabana Begum

China pilots low carbon bonds to help companies become greener

A worker wearing a face mask works on a production line manufacturing bicycle steel rim at a factory, as the country is hit by the novel coronavirus outbreak, in Hangzhou, Zhejiang province, China March 2, 2020. Image: China Daily via REUTERS

From Reuters

SHANGHAI : China is rolling out so-called low carbon transition bonds to help companies become greener, the country’s interbank bond market regulator said on Monday, as Beijing strives toward carbon neutrality.

Under the pilot scheme, companies in eight sectors including electric power, steelmaking, petrochemicals and civil aviation will issue bonds to fund decarbonisation efforts, the National Association of Financial Market Institutional Investors (NAFMII) said in a statement.

Such debt instruments supplement green bonds, and are part of China’s sustainable financing, said NAFMII, which is supervised by China’s central bank.

China, the world’s biggest producer of climate warming greenhouse gas, has pledged to bring its emissions to a peak before 2030 and to become carbon neutral by 2060.

Proceeds from the transition bonds will be used to fund green efforts including cleaner coal production, the application of green technologies and the use of natural gas and clean energy, NAFMII said.

Companies including China Huaneng Group Co, Hualu Holdings and Baosteel have already issued China’s first low carbon transition bonds, the Shanghai Securities News reported on Monday.

Temasek launches green investment arm, pledges $5b in initial funding

GenZero, wholly owned by Temasek, aims to accelerate global efforts to cut carbon emissions and fight climate change. Image: ST PHOTO/KUA CHEE SIONG

From The Straits Times

SINGAPORE – Singapore’s investment company, Temasek, announced on Monday (June 6) the launch of a green investment firm to accelerate global efforts to cut carbon emissions and fight climate change, with an initial pledge of $5 billion.

GenZero, wholly owned by Temasek, aims to deploy long-term and flexible capital to help early-stage companies and technology solutions that need funding to grow towards commercialisation, as well as more mature opportunities that are ready to scale up.

Its investments seek to help the world achieve net-zero greenhouse gas emissions by 2050 and limit global warming to 1.5 deg C above pre-industrial levels, key goals of the United Nations’ Paris Agreement, the world’s main climate pact.

Temasek’s chief sustainability officer Steve Howard said that because decarbonisation is now a specialist investment discipline, the introduction of a platform like GenZero is well placed.

“You can be very alarmist when you talk about climate, so actually it is appropriate for us to ring the bell loudly and say it is on our watch that we have to tackle this,” said Dr Howard, adding that carbon no longer existed on the periphery of the economy but has now become internalised for most companies actively evaluating how they will transition towards net zero.

“This is not about incremental change, it is about transitioning every business and every investment decision. It has been described as the race of our lives and I really see it as that…. and we have to be the generation that leads that change.”

GenZero will be headed up by Mr Frederick Teo, who is currently managing director of sustainable solutions at Temasek International. Mr Teo will assume the role of chief executive from July 1.

Mr Teo, who has been at Temasek for nearly 12 years holding various leadership positions, said GenZero’s investments will focus on three areas.

It will fund technology-based solutions that deliver deep emissions reductions, such as carbon capture, utilisation and storage and advanced biofuels; nature-based solutions that help protect and restore natural ecosystems while benefiting local communities and biodiversity; and investment in companies and solutions that support the development of an efficient and credible carbon market.

He added that while GenZero has a broader, more flexible investment mandate, the company will still be seeking sustainable returns on investments made.

“Clearly we are not going to be investing in solutions that are currently in the lab and not yet ready or if we cannot see a pathway to climate impact,” Mr Teo said.

“We are also looking at solutions that have the potential to scale, because if there is something that works really great but cannot be deployed at scale, it will not be able to create the kind of climate impact that we seek to achieve.”

Author: Luke Pachymuthu, Senior Correspondent

Data-sharing platform for supply chain sector to add new functions like green financing

(From left) SGTraDex CEO Antoine Cadoux, IMDA chief Lew Chuen Hong, Communications and Information Minister Josephine Teo, Trafigura’s Asia-Pacific CEO Tan Chin Hwee and MTI Permanent Secretary (Development) Lee Chuan Teck. Image: ST PHOTO/Ong Wee Jin

From The Straits Times

SINGAPORE – A data sharing platform used in the logistics sector is being expanded with new applications, including one that will digitalise the certification process for sustainable trade financing in the construction sector.

The upgrades will also make it easier to pinpoint the causes of shipping delays and reduce the associated costs, known as demurrage, as well as increase transparency in the procurement of ship supplies and spare parts.

The expansion of what is known as the Singapore Trade Data Exchange (SGTraDex) was announced at the Asia Tech x Singapore (ATxSG) event on Wednesday (June 1) organised by the Infocomm Media Development Authority (IMDA).

SGTraDex is designed to reduce long-standing supply chain inefficiencies, including a heavy reliance on manual, paper-based processes that undermine efficiency, transparency and sustainability.

It works by enabling regulatory, logistics and trade financing data to be shared, which in turn helps supply chain players optimise cargo handling and operations and builds confidence in trade financing.

The platform was first announced at last year’s ATxSG event and has since been piloted with three initial uses: strengthening the financing integrity of trade flows; enhancing end-to-end visibility of container logistics flows; and digitalising the bunkering or ship fuel supply industry.

More than 70 participants, from small-and-medium-sized enterprises to multinational corporations, have signed up to use SGTraDex, including Standard Chartered bank, commodity trader Trafigura, shipping company Pacific International Lines and energy giant ExxonMobil.

Communications and Information Minister Josephine Teo, who announced the SGTraDex upgrade, told the ATxSG event on Wednesday that the three use cases in operation now are expected to capture about $100 million worth of value by 2026, including time and manpower cost savings, a figure that will grow as more participants come on board.

Equatorial Marine Fuel Management Services, a major local player in the bunkering sector, has benefited from SGTraDex.

Mr Choong Sheen Mao, a director, said about one-third of Equatorial’s vessels are “SGTraDex-ready” and have been fitted with sensors that capture data such as the volume of fuel being transferred through flow meters approved by the Maritime Port Authority of Singapore.

“When you have that enforcement, people trust what is being measured by the flow meters on board,” he said.

“The next step is to connect the flow meters to data loggers in order to remit the information to the cloud, and make sure the data flow is secured and trusted.”

This data can be immediately shared securely with clients and other parties like banks and financiers through SGTraDex.

Previously, the process would involve paper documents that needed to be manually checked against the meters, reviewed and audited for accuracy.

Equatorial estimates that it is saving about 50,000 man-hours a year after moving such functions to SGTraDex.

Mr Choong added that his company is also interested in exploring the possibility of tapping SGTraDex for green financing and procurement of ship supplies once the new applications are implemented.

Author: Rei Kurohi

China vows new financial tools to support drive to carbon neutrality

A woman walks across a bridge in front of a chimney billowing smoke from a coal-burning power station in central Beijing February 25, 2011. Image: REUTERS/David Gray

From Reuters

SHANGHAI : China’s government said it will expand its range of financial tools and make greater use of fiscal and taxation policies to support the shift towards carbon neutrality.

China aims to create a basic financial policy framework by 2030 to support green and low-carbon development, and will also aim to give more play to market mechanisms like carbon and pollution discharge trading, according to policy recommendations from the Ministry of Finance published late on Monday.

The world’s biggest producer of climate warming greenhouse gas has pledged to bring its emissions to a peak before 2030 and to become fully carbon neutral by around 2060.

It has already vowed to start cutting coal consumption from 2026 and bring wind and nearly double solar power capacity to 1,200 gigawatts by the end of the decade.

The new guidelines are aimed at creating “a fiscal and taxation policy system that promotes the efficient use of resources and green, low-carbon development,” the ministry quoted an unnamed official as saying.

The ministry also aims to build an “incentive and restraint mechanism” to encourage green and low-carbon practices among local governments, the official said.

According to the recommendations, the tax system will be adjusted to include more preferential policies encouraging energy and water conservation as well as carbon emission cuts. Import tariffs should also be adjusted to meet low-carbon development requirements, it said.

As well as focusing on key sectors such as energy storage and the shift to renewables, new financial tools will also be developed to help transform the transportation sector and promote new energy vehicles, and encourage recycling and the comprehensive use of resources.

The ministry also said more financial policy support would be given to the construction of carbon sinks, the protection of forests and grasslands, as well as climate change adaptation.

OCBC to invest $25 million to cut carbon emissions by approximately 10,000 tonnes

The investments will reduce approximately 10,000 tonnes of carbon emissions within the next four years. Image: ST Photo/Kua Chee Siong 

From The Straits Times

SINGAPORE – OCBC Bank will invest more than $25 million to reduce its carbon footprint in Singapore, Malaysia and Greater China.

The investments will fund energy-efficient technology to reduce carbon emissions, and invest in solar energy systems that will increase renewables in its energy mix, it said in a media release on Wednesday (May 25).

In all, the investments will reduce approximately 10,000 tonnes of carbon emissions within the next four years, or the equivalent of close to removing 10,000 cars off the road for four years.

To improve energy efficiency, OCBC will retrofit its buildings and a data centre with more energy-efficient technologies, including the use of LED lights over conventional lighting and more energy-efficient air-conditioning systems.

The lender’s regional data centre will also implement a rack-based cooling system by the end of this year.

OCBC Bank had announced last month that it will retrofit the air-conditioning system at OCBC Tampines Centre Two, which is located in Tampines Avenue 4, to connect to SP Group’s district cooling network at Tampines Town Centre.

The cooling system will be operational in the first half of 2025.

OCBC also aims to achieve Green Mark certifications for all its retail branches by 2030.

As of last month, four branches and eight buildings, including its learning and development hub, OCBC Campus in Tanjong Pagar, have received Green Mark certifications.

To advance the shift to renewable energy, the lender will install solar energy systems in about 10 buildings in Singapore, Malaysia and Greater China by 2024.

The energy that will be generated each year – over 2,000 MWh – will help offset the bank’s energy consumption in these markets.

The energy savings can power more than 600 three-room HDB households every year.

To improve energy efficiency, OCBC will retrofit its buildings and a data centre with more energy-efficient technologies. Image: OCBC Bank

OCBC Bank will also assess if it can install solar energy systems in other offices in Singapore, Malaysia, Indonesia and Greater China.

Other initiatives include converting its fleet of cars to electric vehicles (EV) and deploying EV charging facilities at major commercial buildings it manages.

Ten charging points have already been installed at OCBC Centre, making it the largest EV charging hub in the business district.

Mr Lim Khiang Tong, group chief operating officer of OCBC Bank, said that everybody must do their part to build a sustainable future.

On its part, OCBC has committed to achieve carbon neutrality in operational emissions from this year.

In 2019, the lender committed to no longer finance new coal-fired power plants, becoming the first bank in South-east Asia to do so.

It has also exceeded its target of extending $25 billion in sustainability-linked and green loans by 2025.

At the end of last year, the lender has extended more than $34 billion of sustainable financing to customers, prompting it to raise the target to $50 billion by 2025.

Author: Chor Khieng Yuit

S’pore, Indonesia ink climate change partnership to pursue goals, including green finance

Senior Minister Teo Chee Hean (right) and Indonesia’s Coordinating Minister for Maritime and Investment Affairs Luhut Binsar Pandjaitan at the signing ceremony. ST PHOTO: Jason Quah

From The Straits Times

SINGAPORE – Singapore and Indonesia inked a climate change partnership on Monday (March 21) that could see them working on clean technology research, or pilot projects related to various ecosystems on land and sea.

They may also share best practices or develop projects related to implementing Article 6 of the Paris Agreement, which outlines creating an international carbon market to help countries meet emissions reduction targets.

Four key areas that both nations will collaborate on are carbon pricing and markets, nature-based solutions and ecosystem-based approach, clean technology and solutions, and green and blended finance.

Blended finance refers to a mix of sources of capital to support sustainable projects in developing countries.

Senior Minister and Coordinating Minister for National Security Teo Chee Hean and Indonesia’s Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan inked a memorandum of understanding (MOU) on Monday to commence various collaborations on sustainability and climate change.

The agreement was developed following the Singapore-Indonesia Leaders’ Retreat in January this year.

Annual high-level ministerial meetings and an inter-agency working group involving senior government officials from both countries will commit to advancing the agreement’s objectives, said Singapore’s National Climate Change Secretariat and Indonesia’s Coordinating Ministry for Maritime and Investment Affairs on Monday.

A work plan, including pilot projects, research collaborations and technical exchanges, between both countries will be developed.

Both countries will also explore financing solutions in areas such as carbon credit projects, carbon capture and storage, and the development of renewable energy solutions to support regional decarbonisation.

Speaking on the sidelines of the signing at Parkroyal Collection Marina Bay hotel, Mr Teo said the MOU will create development opportunities and jobs.

“Singapore will continue to seek opportunities to collaborate with like-minded regional and international partners to create new solutions for a decarbonised and sustainable future.

“Such partnerships will enable Singapore to achieve our net-zero goal by or around mid-century, as we create and seize new green growth and job opportunities,” added Mr Teo, who also chairs the Inter-Ministerial Committee on Climate Change.

Mr Luhut said Indonesia will establish a Blended Finance Alliance under the Group of 20 (G-20) framework.

The alliance will be a multilateral and international institution to pool funds and projects related to climate change and the United Nations’ sustainable development goals.
Indonesia took over the leadership of the G-20 this year, and Mr Luhut invited Singapore to join its Blended Finance Alliance.

Elaborating on the new Blended Finance Alliance, Indonesia’s Deputy Minister for Environment and Forestry Management Nani Hendiarti said blended finance can be used to fund the country’s mangrove rehabilitation and restoration projects, as well as its goals to partially retire its coal-fired power plants, and replace them with renewable energy.

Jakarta has developed a proposal to establish an early retirement of some of its coal-fired power plants with a capacity of 5.5 gigawatts, and replace them with renewable energy with a capacity of 3.7 gigawatts by 2030, added Dr Nani.

Mr Luhut invited Singapore to be a partner in Indonesia’s food estate project, which focuses on improving yields on existing farmland and developing new agricultural land to raise the archipelago’s food security.

Government agencies and other stakeholders, such as the private sector and academia, will be involved in the tie-up between both nations.

Mr Luhut said Indonesia will establish a Blended Finance Alliance under the Group of 20 (G-20) framework.

The alliance will be a multilateral and international institution to pool funds and projects related to climate change and the United Nations’ sustainable development goals.

Indonesia took over the leadership of the G-20 this year, and Mr Luhut invited Singapore to join its Blended Finance Alliance.

The G-20 is an international grouping of 19 advanced and emerging economies, and the European Union.

Singapore, although not a G-20 member, has been invited to participate in the G-20 summits and its related processes.

In January, the Republic was invited by Indonesia to attend this year’s G-20 Summit in Bali later this year.

Elaborating on the new Blended Finance Alliance, Indonesia’s Deputy Minister for Environment and Forestry Management Nani Hendiarti said blended finance can be used to fund the country’s mangrove rehabilitation and restoration projects, as well as its goals to partially retire its coal-fired power plants, and replace them with renewable energy.

Jakarta has developed a proposal to establish an early retirement of some of its coal-fired power plants with a capacity of 5.5 gigawatts, and replace them with renewable energy with a capacity of 3.7 gigawatts by 2030, added Dr Nani.

Mr Luhut invited Singapore to be a partner in Indonesia’s food estate project, which focuses on improving yields on existing farmland and developing new agricultural land to raise the archipelago’s food security.

The project is currently in progress.

Under the new agreement between both countries, collaborations and exchanges on carbon pricing are on the cards.

Last month’s Budget announced that Singapore’s carbon tax would be raised from the current $5 a tonne of emissions to between $50 and $80 by 2030.

During last year’s United Nations Climate Change Conference in Glasgow, Indonesian President Joko Widodo announced a regulation that sets a price on carbon emissions and creates a mechanism to trade carbon.

Author: Shabana Begum