Energy Conservation (Amendment) Bill

Order for Second Reading read.

5.10 pm

The Minister for the Environment and Water Resources (Mr Masagos Zulkifli B M M): Mdm Speaker, I beg to move, "That the Bill be now read a Second time."

The Energy Conservation (Amendment) Bill (EC Bill) seeks to introduce a new set of initiatives to improve industrial energy efficiency, enhance our greenhouse gas reporting requirements and revise the Carbon Emissions-based Vehicle Scheme (CEVS).

Mdm Speaker, the Paris Agreement came into force last year, less than a year after it was concluded. This was a significant milestone in our global fight against climate change and for all who seek a sustainable future for our children. To date, 134 countries accounting for over 80% of the world's total greenhouse gas emissions have ratified the Agreement.

When we strip away its legalities, the heart of this pact is really about energy use and conservation. The International Energy Agency's World Energy Outlook 2016 projected in its "main scenario" that global energy demand would rise by 30% from now to 2040, with accompanying increases in greenhouse gas emissions. Reducing energy use is thus key to address global warming.

Faced with an increasingly carbon-constrained future, countries and businesses have no choice but to transform the way we produce and use energy. At the same time, this has given rise to new opportunities to grow a greener and more sustainable economy. For example, China is embracing renewables in a big way, while India plans to have nearly 60% of its electricity capacity come from non-fossil fuels by 2027. Leading companies have also come on board. Google has committed to power 100% of its operations with renewables. I visited Shell's "Make the Future" exhibition last month which showcased innovative ideas to harness energy without emitting more carbon. One such example was a wind turbine that could capture wind energy produced by cars travelling along a highway.

While innovative technologies can supplement our energy needs, Singapore will still have to depend on imported energy, primarily natural gas, which is cleaner than oil and coal, to meet the bulk of our demand. Our energy demand is projected to increase at a compounded annual growth rate of between 1.2% and 1.8% over the next decade. Given our limited land space, we are disadvantaged in our ability to use alternative energy. Nonetheless, we are committed to do our part to protect the environment and have pledged to improve our emissions intensity by 36% from 2005 levels in 2030, and to peak around the same time under the Paris Agreement.

Mdm Speaker, the Climate Action Plan, which was launched last year, lays out four key strategies to fulfil this commitment, namely: (a) improving energy and carbon efficiency; (b) reducing emissions from power generation; (c) developing and deploying low-carbon technology; and (d) encouraging collective climate action.

In Singapore, the industry sector is the largest energy user, consuming about two-thirds of our total energy consumption and contributing about 60% of our carbon emissions in 2014. Improving energy efficiency (EE) in the industrial sector is thus key to achieving our climate change goals.

In 2012, we introduced the Energy Conservation Act (ECA). Our main objective was to put in place the building blocks to help the industry develop its capabilities in EE. Under ECA, 180 energy-intensive companies, accounting for the lion's share of industrial energy use, are required to implement basic energy management practices, such as regular monitoring of energy use and to appoint qualified energy managers, to oversee EE improvements.

I am happy to report that the preliminary results are encouraging. ECA companies have reported an overall EE improvement rate of 0.4% and 0.6% in 2014 and 2015 respectively. This upward trend is in the right direction. However, in order to meet our climate pledge, we need to double or triple the current improvement rates and achieve 1% to 2% annually, similar to that attained by leading jurisdictions, such as Belgium and the Netherlands. It is timely to bring our efforts to the next level.

The EC Bill that my Ministry is proposing aims to introduce three sets of enhancements to the original ECA. The first, and where the bulk of enhancements are, is on measures to improve our industrial EE. The second set seeks to improve greenhouse gas emissions reporting, and the third deals with the new Vehicular Emissions Scheme (VES). Let me elaborate.

We will introduce three enhancements to strengthen EE practices among ECA companies. They are: one, the adoption of structured Energy Management Systems (EnMSs); two, to conduct regular EE opportunities assessments; and three, to conduct design reviews.

Our analysis of ECA data in 2014 and 2015 showed several areas for improvement. In particular, we found that many companies did not adopt a structured framework to manage their energy use and guide their EE efforts. In addition, EE ambition amongst companies continued to be low.

The proposed amendments to the EC Bill will thus require ECA companies to adopt a structured EnMS. EnMS institutes a "plan, do, check, act" framework for companies to constantly re-examine and improve their EE efforts. Senior management will be responsible for setting energy policy and targets, evaluating them and developing action plans. Studies have shown that having a structured EnMS can help companies achieve energy savings of at least 10% to 15% in the first few years. Countries like Japan and those in the EU have already incorporated this practice in their regulations. With this amendment, companies will be required to put in place an EnMS by 2021 or 2022, depending on the size of their facility's energy consumption.

ECA companies will also be required to conduct regular Energy Efficiency Opportunities Assessments (EEOAs). Also known as energy audits, EEOAs involve systematic assessments of energy consumption and the identification and quantification of potential improvement opportunities. Large companies in the EU, South Korea and India are already required to conduct such assessments regularly. Under the enhanced ECA, companies will be required to submit their first EEOA by 2021.

Many companies have given feedback that the lifespan of industrial equipment can be very long of 30 years or more. Thus, it is challenging to introduce new technologies midway as it disrupts their operations. Instead, it is better to identify and incorporate EE opportunities at the start of the project. With this in mind, from 2018, we will require new industrial facilities and major expansion projects to undergo design reviews to incorporate EE measures.

The three key enhancements that I have just detailed are intended to help ingrain good EE practices among companies.

Thus far, ECA data also showed that many companies have focused on harvesting "low-hanging fruits", or EE measures that have short pay-back periods that provide only low energy savings. Undertaking EE improvements for larger systems, such as boilers, chillers and compressed air systems, would significantly enhance the savings reaped. The data also showed much room for improvement in the EE of common industrial equipment like motors.

Hence, the Bill will aim to increase the adoption of more energy-efficient commonly­ used industrial equipment and systems. An existing measure under ECA is the Minimum Energy Performance Standards (MEPS). MEPS currently covers household appliances and has been successful in raising the EE of these household products. We will revise and extend MEPS to industrial equipment and systems, starting with motors in 2018. We expect MEPS for motors to translate to some 0.4 megatonnes in carbon abatement by 2030.

Mdm Speaker, as a result of these enhancements, we will be raising penalties for several non-compliances to reflect the higher value of industrial goods and to bring them in line with other legislation. However, I would like to point out that the overall benefits of the ECA measures to companies are by far more attractive, including helping them to achieve long-term cost savings and increased competitiveness.

The second set of enhancements that will be made to ECA concerns the reporting of greenhouse gas emissions. These enhancements aim to strengthen the Quality Assurance and Quality Control processes within our Measurement and Reporting (M&R) requirements, to provide a robust foundation for the future carbon pricing regime.

Large industrial emitters will be required to submit a monitoring plan and an enhanced greenhouse gas emissions report based on the approved monitoring plan. Companies will also have to compute their emissions data according to standard methodologies determined by the National Environment Agency (NEA). These will bring our M&R standards in line with international best practices and ensure accurate and robust accounting of their emissions. This will also help companies to better understand and manage their emissions.

The third set of revisions to ECA concerns the VES. As I have announced during the recent Committee of Supply (COS) debate, VES will replace the current CEVS. Under CEVS, only carbon dioxide is taken into consideration in determining the emissions level in a vehicle. VES, which replaces it, will now consider other harmful pollutant emissions in addition to carbon dioxide. Any label on any motor vehicle model displayed for sale-end related promotional materials and advertisements must now include information of the vehicular emissions of the motor vehicle, including information on the fuel economy of the motor vehicle. The EC Bill proposes to amend the ECA to extend the labelling and information disclosure requirements related to VES and to make the relevant amendments to the Road Traffic Act to give effect to the new scheme.

Mdm Speaker, let me conclude. The proposed enhancements to the ECA are forward-looking and aim to guide how we view and conserve precious energy resources. The ECA provides a framework to shape positive choices in the industry, transport and household sectors to achieve a carbon-efficient and sustainable future. It will also catalyse demand for EE and clean energy services, which could become the seeds of future growth. I encourage all stakeholders to work with us on efforts to conserve energy, as we seek a sustainable future together. Mdm Speaker, I beg to move.

Question proposed.

Mdm Speaker: Er Dr Lee Bee Wah.

5.23 pm

Er Dr Lee Bee Wah (Nee Soon): Mdm Speaker, in the next decade, our energy demand is expected to grow at a projected compounded annual growth rate of approximately 1.2% to 1.8%. Our industrial sector is the largest consumer of energy. It is thus important that this sector improves its EE. We pledged a 36% emissions intensity improvement by 2030 under the Paris Agreement. From now until then, we will require a consistent improvement rate of 1% to 2% each year.

In January this year, Environment and Water Resources Minister Masagos Zulkifli had shared that Singapore-based companies achieved an annual EE improvement rate of 0.6% in 2015, and 0.4% in 2014. We certainly have work cut out for us and we absolutely must take a tougher stance on EE.

I would like to ask Minister what if we do not meet what we pledged in the Paris Agreement. What will be the consequences? Certainly, to improve the current situation, it is vital that we must have a clear understanding of what is expected. This means accurately monitoring energy usage, and then using the results, analyse how and how much one can reduce, if necessary.

In South Korea and the EU, companies are required to conduct regular energy audits, usually every three to five years. In place of conducting energy assessments, large companies in the EU can also choose to adopt internationally-certified EnMS, such as ISO 5001. The proposed enhancements to the ECA are thus a move in the right direction. It is wise to mandate that large industrial facilities are to submit a monitoring plan and, subsequently, an improved emissions report to NEA. By making it compulsory for these facilities to adopt methodologies that are in line with internationally recognised protocols, this brings us yet another step further towards international standards for climate-friendly nations.

In the meantime, energy-intensive companies in Singapore have been reporting their energy usage since the introduction of the ECA in 2013. Can the Minister share some insights from these reports, and how the ECA amendments will help to raise the bar for energy-efficient standards of common industrial equipment?

I would also propose more encouragement and incentives for companies to adopt EnMS and software approved by NEA. Rather than adopt a sit­-and-wait approach, reacting to the results from monitoring energy usage, it would be more efficient and productive to get companies started on a good energy management plan. As the need for these EnMSs becomes more prominent, I foresee great potential in this industry and I hope the relevant Government agencies will do more to promote the quality and capability of local EnMSs.

Last year, global energy service provider ENGlE officially opened its first laboratory in Asia in Singapore with support from the Economic Development Board. This laboratory is part of an international research and development (R&D) network, supported by 1,100 researchers and experts worldwide. It focuses on smart energy systems for cities and islands, industrial EE and gas technologies. Are there plans to collaborate with and tap on this network?

Data from NEA shows that a large number of industrial equipment are inefficient. Hence, companies, when deploying new facilities, will now have to ensure that they meet the newly introduced MEPS. This will first apply to motors, gradually extending to include other systems and equipment. I am pleased to note that this new standard is being implemented gradually. While I think it is a good policy to have, it requires a significant amount of change on top of other existing restructuring efforts. I would like to ask how the ECA amendments can help companies to raise the bar for energy-efficient standards of common industrial equipment.

Certainly, in the long run, businesses will gain through savings from improved EE. But in the short term, in trying to kickstart the new systems and auditing processes, this could be a burden for companies, especially in the current economic climate. I have spoken with some business owners, who expressed their concerns about the startup costs of implementing and maintaining the new systems. I would like to ask the Minister if any consultation has been done to obtain feedback from affected companies on the proposed amendments. Moreover, how does the Ministry intend to support them? I think this is important, especially in the initial years, to get companies on the right track. The first and early steps are always the hardest. As we say in Chinese, "万事起".

I am pleased to note that the EE Fund will be redesigned to better support companies to identify and undertake EE retrofitting. This Fund will co-fund up to 30% of investments in more efficient technologies. First of all, I commend this move, as earlier on, the various overlapping schemes and incentives had made it confusing and time-consuming for businesses to tap on them. Hopefully, with this new Fund in place, the take-up rate will become considerably higher.

My next concern is how accessible the funds are, whether the release of funds will be done at the start of the project or after it is completed, with justification of evidence of expenses. I would like to bring to attention the Brussels' zero-interest Green Loan. It is applicable to households, and that is because residential buildings are responsible for the majority of energy consumed in the city. The Brussels Green Loan is available to Brussels households with a limited income and it will eventually be extended to all households. I hope the Government will consider something similar for businesses, as sometimes it is challenging for businesses to kickstart something without sufficient capital.

Energy storage should be another major component in a comprehensive far-sighted strategy for energy sufficiency. Considering our small geographical size, energy storage would be vital in supporting greater deployment of photovoltaic systems or solar power systems. It could potentially be a game changer for our electricity market in the near future. More can be done to attract investors through incentives and a certain climate to encourage them to invest in energy storage applications and technology. I understand that under our Energy Storage Programme, the Energy Storage System Testbed is one of the initiatives to explore energy storage feasibility and technology in Singapore. This is a fairly new initiative, and the Request-for-Proposal was launched last year. I would like to ask the Minister for an update on it.

It is clear that there is a globally shared understanding on the importance of energy management in combating climate change. So, energy services in facilities management will certainly continue to be in demand in the years to come. To make the entire framework sustainable, there needs to be continuity and this means a long-sighted approach, nurturing talents of tomorrow. We must not only focus on energy management within industries but also on the provision of these energy services management.

In recent years, several courses have been developed by the local universities and polytechnics, offering degrees and diplomas in energy management and the like. What is the take-up rate of these courses, and how many students eventually graduate to work in a related field of their studies? Will there be opportunities for mid-career switches?

Singapore's efforts to maximise EE may be intrusive for businesses but should be embraced for the potential positive impact it would have, not just on the environment but on the economy. Germany recently commissioned a study to analyse the potential impacts of the Paris Agreement, and the report revealed that efforts to slow climate change could boost the world's economy by $19 trillion. Investments in renewable power and EE will add about 0.8% to global gross domestic product by 2050. But in any country, this will require a multiple-pronged approach that involves the government, businesses and individuals. Certainly, we should not be left behind. Let me to summarise in Mandarin.

(In Mandarin): [Please refer to Vernacular Speech.] This amendment will require many companies to improve their EE. This is for the sake of the earth. However, the current economic situation is not looking good, many small and medium enterprises (SMEs) are worried about the cost. I hope that the Government can pay attention and help them. I also hope that the Government can pay attention to EE in households. Can we do what Belgium has done and help households improve their EE?

With countries promising to reduce their emission under the Paris Agreement, the world economy could see business opportunities worth $19 trillion in areas, such as energy management. Does Singapore have sufficient talents in this area? And how is the Government going to help our enterprises to seize these business opportunities? Can the Minister share with us?

Mdm Speaker: Mr Leon Perera.

5.36 pm

Mr Leon Perera (Non-Constituency Member): Mdm Speaker, the EC Bill seeks to update and improve the law that governs energy use among energy-intensive companies, so as to better position us to meet our greenhouse gas emission targets under the Paris Climate Change accord. Meeting these obligations is a matter of being responsible global citizens. But this is also about serving the national interest of Singapore, since we have the interest in managing sea level, ensuring clean air for our citizens and so on and so forth. I do not object to the thrust of the Bill, but I do have some queries and suggestions.

The Bill moves us from CEVS to a VES that takes other harmful pollutant emissions into consideration, in addition to carbon dioxide. I agree that this is generally a good move, as it means that adopting a broader and more relevant definition of pollutant emissions, now in encompassing hydrocarbons, carbon monoxide, nitrogen oxide and particulate matter.

It is good that it will be a requirement to label the vehicular emissions instead of just the fuel economy of vehicles, given that we are not meeting our 2020 target for PM10, PM2.5 and ozone. However, under both CEVS and the new VES, rebates and surcharges are not given based on actual carbon or pollutant emissions. Rather, the rebates and surcharges are based on the vehicles' capacity to emit carbon or pollutants. Hence, the system incentives purchase of more energy-efficient vehicles, which is a good thing, but it does not incentive less mileage and, hence, less actual emission.

I suggest that in future, we consider shifting towards an incentive system that incentivises the reduction of actual emissions, in addition to the purchase of less pollutive vehicles. Can this be considered post-2020, with the introduction of the ERP2.0 system? If this is introduced, it should be revenue-neutral with additional surcharges for mileage offset against other cost borne by motorists.

Next, I would like to query the provisions relating to conducting an EEOA, so as to obtain a clearance certificate for a new venture, which is contained in a newly inserted section 26A. Existing businesses are also required to conduct such assessments for prescribed activities and premises under the new section 27(B). In the new section 27(B), an is defined as a systematic procedure by which adequate knowledge of energy consumption profile of any business activities or premises and cost-effective EE opportunities are identified and quantified.

Madam, I would like to ask if the Ministry or NEA will be prescribing the format for such reports and also to recommend the standard, or perhaps several standards, of accreditation for organisations to provide such assessments, since some organisations would opt to work with third party consultants to generate such a report. Since this new legal requirement may trigger a growth in third party consultants producing such assessments, efforts should be undertaken in concert with industry bodies to ensure that consultants offering their services in this field to generate these reports are suitably qualified.

The Ministry should also provide more guidance to those producing such assessments, whether they are done in-house or by third parties, to ensure that these assessments can be done in a focused and, hence, cost-effective way that meets the requirements of the law. Minimising the risk of over-reporting, and hence of consultancies over-charging, or of internal resources being wasted.

Mdm Speaker: Mr Louis Ng.

5.40 pm

Mr Louis Ng Kok Kwang: Madam, I am heartened by this Bill as a signal of the Government's firm commitment towards an economic model that considers not just raw growth in numbers, but also growth that is responsible to both society and the environment.

This is not the first in our series of bold commitments towards environmental protection, following on from the recent announcement of the carbon tax and, last year, in requiring sustainability reporting from all listed companies.

Since the ECA was brought into effect in 2013, it appears that companies have been able to fulfil the Act's requirements to implement certain basic energy management practices. These include appointing at least one certified energy manager and reporting their energy use and greenhouse gas emissions.

Singapore's Climate Action Plan released in July 2016 revealed our intention to encourage the manufacturing sector to achieve EE improvement rates of 1% to 2% a year between 2020 and 2030. Thus, it seems like a natural next step to enhance the Act by requiring industrial facilities to submit a monitoring plan and emissions report in line with international standards.

Madam, during the COS debates, Minister Masagos compared Singapore's EE improvement rates to that of other countries like Belgium and the Netherlands. He mentioned that operational and capability constraints and inefficient common industrial equipment could be the reason for lower EE rates in Singapore.

I believe that another reason could also be the highly specialised and integrated nature of Singapore's industrial sector, which leaves little room for downtime. Improving EE often requires equipment upgrades, but such upgrades are likely to cause disruptions to operations and come at a cost. Furthermore, companies operating on thin margins may avoid proposing improvements to EE, as this often involves high capital costs and adds pressure to their bottom line.

Management often approves projects that meet the dual criteria of low investment cost and short pay-back periods, and projects on EE may not meet this mark. I believe the Government has spotted these barriers and is planning to conduct reviews of incentive schemes to support companies in this transition. This includes piloting an EE financing programme and providing investment allowance for EE. Can the Minister provide more details about this and on when we can expect to receive updates on these revised incentive schemes?

I understand as well that we have implemented previous energy-related incentives and grant schemes. This includes the Design for Efficiency (DfE) Scheme, Energy Efficiency Improvement Assistance Scheme (EASe), Grant for Energy-Efficient Technologies (GREET), and the Singapore Certified Energy Manager (SCEM) Training Grant.

As an indication of how receptive the industry is towards Government support for EE, can the Minister share information on the take-up rate of the key schemes that I have listed? Was there a slow take-up rate and could slow take-up rates have contributed to low EE improvement rates?

I also note that EE grants are being consolidated under the Energy Efficiency Fund (E2F). Does the Ministry of the Environment and Water Resources (MEWR) believe that consolidation will lead to better take-up rates? Given that the Bill's enhanced requirements will come into effect from 2018 onwards, will MEWR or NEA make available the E2F so that companies affected will have time to apply for the grants? What measures can be taken to improve the take-up rate of E2F as well?

Madam, the Government must continue to support the industry in our goal to leapfrog from our current 0.2% to 0.6% towards the 1% to 2% goal for our EE improvement rates. I raise these points to ask for further clarity on how we are providing that support, beyond strengthened requirements for monitoring and reporting, as proposed by this Bill.

That said, I applaud this Bill for announcing bold steps in ensuring that Singapore meets its Conference of the Parties (COP21) commitments and I stand in support of the Bill.

Mdm Speaker: Minister Masagos.

5.44 pm

Mr Masagos Zulkifli B M M: Mdm Speaker, I would like to thank the Members of this House for their support and comments on this Bill.

Globally, we see a shift towards a carbon-constrained economy. This momentum is partly driven by countries working towards meeting their commitments under the Paris Agreement. But there is also an increasing realisation that we all, as individuals and corporations alike, cannot continue with business as usual. Climate change is happening. The impacts can be devastating as some countries and cities are already feeling this impact. So, even as we strengthen our resilience to deal with the unexpected, we all have a responsibility to take action now to reduce our carbon footprint.

The challenge then is whether we are prepared to make decisive moves, to take difficult decisions today and seize new opportunities as they arise, so that our nation can continue to grow and prosper in a very carbon-constrained world. Status quo is, therefore, not an option, if we are not to be left behind. As mentioned in my speech, China is making big moves in renewables. They will be investing 2.5 trillion yuan, about S$506 billion, into renewable power generation by 2020 as they set their eye on becoming a green energy superpower. Global companies, such as Apple and Unilever, have also set ambitious goals to "green" their practices.

These are just a few of the many developments around the world. We must not delude ourselves into thinking that we can stay where we are. To maintain Singapore's international competitiveness in the long run, we need to ready ourselves for a carbon-light future.

Er Dr Lee Bee Wah asked what will happen if we do not meet our Paris Agreement commitments. Singapore has a strong international reputation to uphold and, as a responsible global citizen, we are committed to fulfilling the pledge. To achieve this, we will have to implement tough mitigation measures in all key sectors, not just in the industrial sector, but also in the transport, building, power and household sectors. Everyone will have to make adjustments.

Er Dr Lee also asked for insights from the Energy Use Reports reported under ECA. In addition to companies having low ambition, we found that the majority of companies − 60% − did not have EE improvement plans beyond the first two years. A significant proportion of the common utility systems, such as boilers, chillers and compressed air systems, were operating inefficiently. Hence, the enhancements in this Bill aim to help companies improve their energy practices and raise the bar for EE performance standards in Singapore, starting with motors.

To illustrate, motors collectively account for 80% of the total electricity consumed by the industry. With the introduction of MEPS for motors, we expect to achieve annual savings of 1,100 GWh (gigawatt hours) or around 2% of Singapore's electricity consumption by 2035, as companies replace their less efficient motors. Collectively, the enhancements in this Bill are expected to contribute to at least 7% of our greenhouse gas emissions reductions.

Let me now move on to the issue of helping businesses to seize new growth opportunities in clean energy and energy management. Unfortunately, Singapore is an alternative energy disadvantaged country because of our physical size. Solar energy remains our best option, but even this is not without its challenges. We have been exploring innovative ways to overcome our constraints. For example, in 2016, Singapore embarked on the world's largest floating solar testbed at Tengeh Reservoir.

Under the SolarNova programme, solar systems will be pervasively installed on the rooftops of about 6,000 Government buildings, such as public housing, schools, army camps and utilities, by 2020. All these initiatives open up new business opportunities for our companies.

To keep pace with the growing share of solar energy in Singapore's electricity generation mix, we are also taking proactive steps to address the issue of intermittency and to ensure grid stability. In May 2016, the Energy Market Authority (EMA) and Singapore Power embarked on the national Energy Storage System testbed (ESS testbed), to evaluate the performance of grid-level energy storage systems for different power applications. Er Dr Lee asked for an update of the project. There was strong interest from consortiums comprising notable local and international companies when the Request for Proposal (RFP) closed in August 2016. An international evaluation panel, comprising Singapore Power, relevant Government agencies and technical experts, is currently reviewing the various proposals. A decision on the eventual award winners will likely be made by end 2017.

Given the challenges we face with renewable energy today, improving our EE thus remains a key strategy for Singapore. I would like to assure Members of the House that we have had extensive consultations with the industry on these enhancements and have taken on board the companies' feedback to ensure that the measures are not overly onerous, but without compromising on ambition. Companies understand the need for EE improvement and are generally agreeable with our proposals. I am heartened by their commitment to keep working at improving EE.

Er Dr Lee and Mr Leon Perera raised the issue of compliance costs. In the short term, companies under ECA will face an increase in compliance costs. However, in the long run, these enhanced EE measures will help companies reap lifetime energy and cost savings. We are also not imposing any standards. Many of these big companies already have inhouse systems and standards and the reporting systems that we can rely on, and we will use this first. Hopefully, this can be used for our verification purposes and not impose standards that will be too onerous. Hence, companies need to adopt a long-term view as these measures will put them on a stronger footing to compete in the carbon-constrained world that we will be operating in.

In my dialogues with the companies, some of them sought funding support to implement related EE-measures and asked whether the Government can help to improve the supporting EE ecosystem.

I would like to thank Er Dr Lee and Mr Louis Ng for highlighting NEA's E2F. NEA decided to review and consolidate the existing EE grants into the E2F, given the low take-up rates noted by Mr Louis Ng and in response to feedback from companies on the need to improve the financial support and accessibility to the grants.

Under E2F, companies no longer have to navigate through different incentive schemes to find one that suits their needs. The grant application process has also been streamlined to minimise paperwork. E2F will place greater emphasis on SMEs and there will be 50% support given to eligible companies to co-fund design reviews and energy audits. E2F will be launched today and I encourage companies to tap on it.

Mr Louis Ng also asked for details of the EE Financing Programme and Investment Allowance Scheme for EE administered by the Economic Development Board (EDB). The EE Financing Programme is in the pilot stage. Essentially, companies which are not able to afford the upfront costs of EE projects can apply for loans through a third-party financier. The potential benefits of such a scheme include an off balance sheet solution, where industrial facilities are not required to pay for the upfront costs of the EE projects, but still enjoy part of the energy savings. The Investment Allowance Scheme for EE is a tax incentive that allows up to an additional 30% investment allowance against taxable income on capital expenditure related to eligible projects by companies. These two schemes provide alternative financing options for companies which want to pursue EE efforts but need more financial support. As the EE Financing Programme is still in the pilot stage, more updates will be provided in due course.

Aside from financial support, we will study how we can improve the supporting EE ecosystem. This includes enabling more sharing of best practices amongst companies, building up the capabilities of energy managers to identify EE opportunities, and developing the energy services sub-sector, such as consultancies for specialised industry processes. We will also continue to leverage research and technology to improve EE and are open to working with interested partners and stakeholders.

Lastly, developing talent in this sector is important, too. As Er Dr Lee highlighted, local polytechnics and the Building and Construction Authority (BCA) offer diploma programmes related to energy management. The annual intake for these programmes is about 350 students. NEA and the Institution of Engineers also administer the Singapore Certified Energy Manager Professional Level programme. Individuals who wish to pursue a career in energy management, including those making mid-career switches, can apply for this programme. There are currently 622 certified energy managers. Many of them take on energy management roles in about 230 energy-intensive industrial facilities that are regulated under ECA.

To conclude, the amendments to this Bill are an important step forward not only in encouraging industry and consumers to play their part in addressing climate change, but also in preparing us for a carbon-constrained global economy. Therefore, I call on Members of the House to give their support to this Bill.

Mdm Speaker: Are there any clarifications? No.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. – [Mr Masagos Zulkifli B M M.]

Bill considered in Committee; reported without amendment; read a Third time and passed.