Policy reforms needed to decarbonise Singapore’s industrial heating: report
Electrification policy is a ‘foreign direct investment retention question’, says industry association
Singapore's industrial sector consumes 40% of the nation's electricity and accounts for 90% of domestic natural gas consumption, primarily used for heating processes. To decarbonise the sector, the Sustainable Energy Association of Singapore (SEAS) recommends electrifying industrial heating, with the country aiming to import 6 GW of low-carbon electricity from neighboring countries.
While some industrial heating processes are already electrified, 95% of Singapore's energy mix still derives from natural gas. SEAS proposes a tariff reform road map and a government-funded feasibility study programme to encourage the necessary transition. The report notes that commercial technologies for electrifying low and medium-temperature heat processes exist, but the market has not yet shifted due to insufficient incentives, such as competitive electricity pricing, accessible financing, and clear regulatory signals against fossil lock-in.
Transitioning to electrified heating processes would benefit Singapore by improving energy resilience, reducing dependence on imported natural gas, and positioning the city-state to leverage cleaner renewable energy sources as the grid decarbonises. This shift is not only a climate imperative but also a foreign direct investment retention question, as multinational companies operating in Singapore's industrial base may seek locations with more favourable energy policies.
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