Growing New Industries that Promise Economic and Non-economic Benefits

ADJOURNMENT MOTION

The Leader of the House (Ms Grace Fu Hai Yien): Mdm Speaker, I beg to move, "That Parliament do now adjourn."

Question proposed.

Growing New Industries that Promise Economic and Non-economic Benefits

6.25 pm

Mr Leon Perera (Non-Constituency Member): Mdm Speaker, as a nation, we have always prided ourselves on our ability to think long term and our willingness to defy conventional wisdom about our limitations.

Water is a prime example. In the 1990s, few thought we could move towards some degree of self-sufficiency in water supply. But two decades on, Singapore is making good progress on this front and in the process also built up an economically relevant water-related technology sector. We can turn necessity into opportunity. We can do what is needed for security and turn it into exportable know-how.

Singapore faces two other limitations which can likewise be turned into opportunities: food and energy, both of which are largely imported.

First of all, I shall speak on indoor farming, which is a growing form of urban farming where crops are grown in a highly controlled environment, protected from the elements. In indoor farming, environmental factors such as the exposure to light, water, humidity and the temperature are carefully calibrated to create an optimal environment for crops to grow.

In 2013, Panasonic Factory Solutions Asia Pacific opened a major indoor vegetable farm in Singapore in one of its factory buildings which illustrates these techniques. Panasonic started with 10 types of vegetables in its 248-square-metres facility. By March 2017, Panasonic aims to increase the number of crop varieties to 30 and aims to supply 5% of local vegetable production, up from the 0.015% in July 2014. This is not an insignificant target given that all local farms currently produce only 8% of all the vegetables consumed in Singapore. While Panasonic's crops are currently grown in a soil-based environment as opposed to soilless methods that have been gaining popularity, the company is looking into R&D to boost yield, including vertical farming which utilises vertically stacked racks for space optimisation.

Vertical indoor farming is not completely new in Singapore. In fact, the Government has collaborated with local company Sky Greens to develop a low carbon footprint vertical farming system. Sky Greens began its commercial operations in 2012 and was able to produce 800 kilogrammes of vegetables daily in 2015.

Mdm Speaker, with more investment in R&D, there is every reason to believe that the current price difference between indoor farmed and conventionally farmed vegetables will fall over time.

We are still some distance away from the scale of production seen in other countries where more land is readily available for indoor farming. The world's largest indoor farm in Japan spans 25,000 square feet and produces 7.7 million heads of lettuce a year.

The Government has acknowledged the potential of the sector. To this end, the Government announced the launch of a $63-million Agriculture Productivity Fund (APF) in end-2014 that replaced the Food Fund Scheme. However, only $0.69 million of the $63 million has been disbursed in the year since the launch of the APF. According to a Government statement in October 2015, this $0.69 million, or less, had been shared among 20 local farms owned by 17 companies. It is unclear how much of the Fund was disbursed to Singapore-based companies.

I believe that there is much more that can be done to encourage local firms to excel in this field. We should recall that indoor vertical farming is a high-tech, knowledge-intensive activity that requires the integration of many different types of expertise. Singapore, as a developed country with limited land and high population density, offers a good test bed. If economic development agencies adopted a proactive approach of grooming local Singapore-based SMEs to develop leading-edge technology and know-how in indoor farming, Singapore could be producing an even higher share of our consumption needs and developing an exportable sector that could contribute to our economy.

The Workers' Party would also like to propose that the Government go beyond what is currently being done in urban farming and develop some of our underground space into large-scale indoor vertical farms.

It was reported in 2013 that the Government was exploring various uses of underground space. The then-Minister for National Development suggested that, "We can try to push the boundary of usage [of underground spaces] – to experiment, to learn and to evolve practical innovative solutions – so as to prepare for the future."

We believe that large-scale indoor vertical farming should be given due consideration for the use of our underground space in Singapore.

The world's first underground farm opened in mid-2015 in the heart of London, in a WWII air raid shelter 33 metres under the ground. In London where space comes at a premium, an enterprising firm has found an innovative and sustainable way to grow crops and deliver them to restaurants in under four hours.

The benefits of underground vertical farming are, essentially, three-fold. Firstly, food security. Underground indoor farming promises to protect our food supply from catastrophic events, security threats, crop disease and so on. As for affordability, new technologies have enabled higher crop yields for indoor farming. Sky Greens, for example, has been able to produce at least 10 times more yield per unit of land area versus conventional methods. The world's biggest indoor farm in Japan has claimed to be 100 times more productive than traditional farms.

Certainly, not all our food supply can come from underground vertical farming; there are still price differences but it is moving in a positive direction.

Secondly, sustainability. The amount of water used in indoor vertical farming has been found to be substantially lower due to the layout of the racks and the implementation of water recycling features built into the system. The underground farm in London uses 70% less water than traditional farming. Indoor farming also reduces shrinkage, which is loss of crops during transportation. The much-shorter journey from the farm to the marketplace also means that the crops remain fresh for longer periods after they reach our shelves.

The third benefit is developing expertise and IP for our economy. Singapore is well-positioned to become a global leader in the field of underground urban agriculture. Our local enterprises can be nurtured to not only operate indoor farms effectively in Singapore for the benefit of Singapore and Singaporeans, but also to cultivate expertise in designing, installing, implementing and managing such facilities in similar high-density urban environments around the world. That could be an exportation sector for our economy.

Mdm Speaker, with more investment and governmental promotion, we can develop a sizeable indoor vertical farming sector, not to completely replace imported food – that is not practicable in the short term – but to mitigate our dependence on imported food and harness economic benefits from a new and knowledge-intensive exportable sector.

Next, I would like to speak of another such sector: renewable energy and in particular solar power generation.

Solar photovoltaic (PV) power generation is the most relevant renewable energy technology for Singapore – or one of the most relevant, certainly – given our equatorial location and relative lack of feasibility for other renewable energy sources, such as biomass, wind, tidal, hydro-electric or geothermal.

Countries are finding that shifting towards renewable energy enhances energy security and economic stability in the face of volatile global fossil fuel prices. Moreover, the cost-effectiveness of technologies such as solar PV technology is continuing to improve rapidly. The cost of solar panels has come down by a factor of five in the past six years and is expected to halve in the next 20 years. The solar power sector globally has grown by over 10% a year for the better part of a decade and is now worth over $3 trillion.

Domestically, solar power would help to build up industrial capacity and create good jobs within the entire supply chain, from maintenance to operations, to research and development. In particular, there is an opportunity for Singapore to develop leadership in the deployment of solar power generation in dense urban environments. This could be know-how that is developed, internalised and then exported by our locally based companies.

As early as 2007, "cleantech" was identified as a key economic growth area by the Government, which led to EDB's Clean Energy Initiative. In recent years, EMA has also introduced a number of enhancements to the regulatory framework governing the interaction of intermittent renewable sources with Singapore's electricity grid.

Spending on solar power is dwarfed by current public spending on fossil fuels. It is no doubt necessary to invest in and upgrade our infrastructure for oil, natural gas and LNG in the short to medium term. However, there is room to invest more on solar energy in several ways.

Firstly, more can be done to exhaust opportunities for rooftop solar panel deployment. In this regard, we are fortunate that most housing in Singapore is public housing, which facilitates the achievement of this goal. In October 2014, HDB began awarding the zero-dollar solar leasing tender, meaning that the full costs of solar PV systems are borne by the PV developers. In June 2015, HDB called the first consolidated tender under the SolarNova programme for 220 megawatt peak, which is a small fraction of the estimated six megawatt peak of solar capacity that is potentially available, according to estimates in Singapore. This initiative was leading to the installation of solar panels at some 5,500 HDB blocks. We can be more aggressive here and set a goal to install solar panels on every HDB building roof by 2025.

Secondly, more should be done to study and exploit opportunities in unorthodox solar panel deployment, such as on water bodies. PUB has been looking into building solar panels on the Tengeh reservoir and Choa Chu Kang waterworks. One that is being built in the UK – that is, water-borne solar panel deployment – is reported to cost about £3.5 million or about S$7 million, and will generate around three megawatt. The UK deployment covers an area about half the size of Bedok Reservoir, which is one of our smaller reservoirs. Solar panel deployments across all our reservoirs and also some available parts of our territorial waters outside of established sea lanes, could contribute significantly to energy production. Japan has floating solar panels in Hyogo prefecture and is now working on building the world's biggest floating solar farm in Chiba prefecture by 2018.

Mdm Speaker, these measures by themselves will not enable us to replace fossil fuels in the foreseeable future. But they will tilt the balance towards greater energy security, lower carbon footprint and exportable economic opportunities for Singapore-based firms to develop expertise in managing, maintaining and deploying urban solar panels, in the same way that Singapore firms have cultivated expertise in urban master-planning and industrial park design and management, expertise that has been very successfully exported.

Above all, there is a need for us to examine the facts and then set a stretch target for what percentage of energy consumption should be achieved by solar by, say, 2030.

According to a recent paper by the Clean Energy Committee of the Sustainable Energy Association of Singapore, a conservative projection suggests that the capacity available for solar generation in Singapore is actually 17% of electricity demand in 2025, far above the expected 7% that would be achieved by 2025 without government intervention. A recent study by the Solar Energy Research Institute of Singapore (SERIS) suggested that solar PV could contribute as much as 20% to the overall electricity mix by 2050 but that figure could be pushed to 30% under an accelerated scenario.

We suggest that a study be undertaken to assess what can be a feasible target for solar power as a share of total electricity generation by 2030, under both a conservative and a stretch scenario, so that we can debate how much should be invested, where and towards what goals in developing solar power generation in Singapore.

In short, we suggest a more aggressive approach to better exploit rooftop and water-borne opportunities for solar power generation, together with investments in R&D in areas such as electricity storage.

Mdm Speaker, in conclusion, we hope that these suggestions will lead to more fact-finding on the part of the relevant Government agencies, working with academia and the private sector so as to develop these two sectors as engines for economic and non-economic benefits for Singapore. We are at our best when we apply ourselves to overcoming our natural limitations.

6.39 pm

The Parliamentary Secretary to the Ministers for Trade and Industry (Ms Low Yen Ling): Mdm Speaker, I would like to thank Mr Leon Perera for introducing this Motion.

Today's uncertain global economy holds challenges that require us to be flexible yet steadfast, nimble and adept, and far-sighted in our approach. Since the early days of our nation, the Government has made it a top priority to grow our economy and create good jobs for Singaporeans. We have to keep this dynamic DNA of being adriot, always looking for opportunities and having a can-do spirit even in the face of difficulties. That was how new ideas and possibilities were born and painstakingly nurtured into industries, and became reality.

We have to stay nimble and adapt to this changing global environment while meeting the needs of Singapore. With this approach, Singapore successfully grew through various phases of economic transformation.

For example, we moved from the labour-intensive manufacturing era of the 1960s, into skills and capital-intensive industries by developing the Electronics, Chemicals and Precision Engineering clusters during the 1970s and 1980s. By the 1990s and 2000s, we had made a strong push into knowledge and innovation-intensive activities. If Members recall, our first five-year National Science and Technology plan was put in place in 1991. More recently, the Research Innovation Enterprise 2020 Plan (RIE2020), recently announced by the Prime Minister, is the sixth science and technology plan for Singapore.

Today, we have a competitive manufacturing base with key clusters in Chemicals, Precision Engineering, Biomedical Manufacturing, Electronics and Transport Engineering. Last year, manufacturing accounted for 20% of our economy and employed more than 500,000 workers. So, manufacturing remains a key pillar for Singapore and opportunities continue to be found.

Having said that, we are not standing still but moving forward into new and exciting areas of manufacturing. We continue to target high-value niche segments and enter adjacent growth areas to leverage on our strengths, our workers' capabilities, our local companies' strengths, knowledge and technology in those areas.

One example is biologics manufacturing in the Biomedical Sciences cluster. It is showing early fruits of success. Today, we have anchored nine biologics manufacturing plants from leading companies such as GlaxoSmithKline (GSK), Novartis, Roche and Amgen.

Likewise, we are building on the strengths of our Precision Engineering and Electronics clusters to develop Space Engineering as a promising sector. Last December, ST Electronics launched its very own self-developed first commercial earth observation satellite TeLEOS-1. Our local SME Addvalue Innovation Pte Ltd has also developed a proprietary Inter-satellite Data Relay System (IDRS) which is being tested on board NTU's VELOX-II satellite launched in December. There are currently more than 150 researchers working on satellites and over 30 companies creating high-value jobs for more than 1,000 professionals in this nascent sector.

We will also continue to invest in research and development, innovation and capability development to position our manufacturing sector for the advancement of new manufacturing technologies such as robotics, industrial data analytics and additive manufacturing. To this end, $3.3 billion has been set aside for the Advanced Manufacturing and Engineering domain under RIE2020.

As the nature of manufacturing continues to evolve, companies are incorporating more manufacturing-related services into their business models. For example, aerospace original equipment manufacturers (OEMs) are moving beyond manufacturing to provide total support packages (TSPs), where the sale of aircraft or aircraft systems is bundled with a full range of support services such as engine maintenance and field support services. This is an important trend and it presents opportunities for Singapore and our companies to anchor more high-value manufacturing-related services such as R&D, engineering, logistics and maintenance. These activities, in turn, will add to the vibrancy of our manufacturing ecosystem and further strengthen our innovative capabilities.

To stay relevant and competitive, we are constantly on the look-out for new areas and opportunities to grow and evolve our economy. One of the ideas is to grow the concept of Singapore as a "living lab", where companies co-develop, test-bed and export new solutions that not only address our country's domestic needs but also generate economic outcomes.

An example, also mentioned earlier by Mr Perera, is our nation's water success. Our motivation to be self-reliant and develop water treatment technologies, such as desalination and water reclamation, has spurred the development of a vibrant water industry. There are now about 180 water companies and 26 private research centres in Singapore. Opportunities like these can still be captured, if we keep our can-do spirit, inventiveness and relentless pursuit of innovation.

For example, we have the chance to turn the challenges of an ageing population into creative energy and solutions in healthcare. Changi General Hospital's Centre for Healthcare Assistive and Robotics Technology (CHART) is exploring how to provide accessible, affordable and high quality healthcare even as the workforce and population ages. To this end, it has set up a collaborative platform for healthcare professionals to work closely with academia, industry and research institutions to develop impactful healthcare solutions using robotics and assistive technologies. The solutions developed could then be exported to other countries facing similar challenges with an ageing population and workforce.

We are also nurturing emerging industries in the area of lifestyle products and services like sports, the visual and performing arts, design and consumer research and development. These sectors involving creativity and design have a significant non-monetary value that could contribute to social development, quality of life and the overall well-being of our community. We are aware about international sporting events brought in by the World Sports Group, to the range of top-notch art houses; all these various stakeholders and players enhance the vibrant Singapore city life.

Members would be familiar with Procter & Gamble (P&G). I understand that P&G's independent innovation research centre located in Singapore Polytechnic is focused on creating product design and development for consumers aged 50 and above in Asia. This project is called the "Live Well Collaborative". Its work is relevant to rising baby boomer Singaporeans whose sophisticated tastes could well spurn a new elderly industry, not just in Singapore but the region.

Turning our attention to clean and solar energy, Singapore is a sunny place and we can make that work harder for us. There are ample opportunities to tap solar energy and spread the sunshine into new areas of growth.

In fact, Government-lead demand is helping to grow the nascent solar industry. For example, SolarNova is a Government-led programme, spearheaded by the EDB, which encourages Government agencies to come together to harness solar energy for their electricity needs. It is really taking a whole-of-Government approach to create sophisticated demand. With HDB acting as the Government's central procurement agency for solar panels, agencies with slightly smaller demand can then benefit from economies of scale and enjoy solar energy at a lower cost. At the same time, by aggregating and catalysing solar demand in Singapore, we seek to spur the growth of our solar industry. The increasing adoption of solar energy will also generate and attract innovation around smart grids and energy management.

I have taken pains to cite the various examples, not just solar but also healthcare, sports, lifestyle, advance manufacturing and so on. This is really to share with Members how we are moving into adjacent growth areas. In all these, some of the benefits extend beyond direct economic impact and will present exciting potential with room to grow. They not only address the needs of Singaporeans, but also represent participation and efforts from the public sector, businesses, academia and the broader community.

The Member talked about technology for vertical farming. MTI has been working with MND and AVA. We understand that AVA has been engaging farmers since a few years ago. They have been encouraging the farming community to push the envelope, to adopt technologies and farming techniques that would intensify our land use while also optimising productivity to enhance our food security.

There was some suggestion about the use of underground space and so on. This needs to be studied. As Members know, developing underground space has a cost issue, it could be expensive. We do need to understand what are the trade-offs and the cost-benefit analysis. So, more studies need to be done to ascertain the best use of underground space.

Amidst our efforts to develop our economy, push the frontier, moving into new adjacent growth areas by leveraging on our strengths, the important thing we need to remember in this House is that the top-most priority of why we do all these is because we want to create good job opportunities for Singaporeans.

Even as we nurture new sectors, we are mindful of Singaporeans with new skillsets to benefit from future job opportunities. With SkillsFuture, Singaporeans have the chance of embracing lifelong learning as a way of life so as to stay relevant in today's fast-changing world. To achieve this vision, we need the support of all Singaporeans, education and training providers, and employers. For example, firms that move into new industries play a very important role because they are early adopters. They play an important role not only in the job creation, but in the learning they can facilitate through internships and professional attachments, as well as the partnerships they form with our schools, Institutes of Higher Learning and Research Institutions for these nascent sectors.

If I could quickly share the example that I experienced myself last week. The advanced manufacturing sector sets a good example. Four of its key players, the Advanced Remanufacturing and Technology Centre (ARTC), Institute of High Performance Computing (IHPC), the Centre of Optical and Laser Engineering (COLE) and the Singapore Centre for 3D Printing (SC3DP), together with Nanyang Polytechnic (NYP) and WDA, have signed an MOU to build the industry's workforce capability and skills through a series of masterclasses, workshops and conferences.

The same approach of working together to upskill Singaporeans also holds true for our domestic and social sectors. In fact, the SkillsFuture effort extends to sectors, including Retail, Built Environment and Healthcare. Sectoral Tripartite Committees, comprising employers, unions and sectoral champion agencies, work together to map out Sectoral Manpower Plans (SMPs) covering skills-based career progression pathways, job re-design, as well as efforts to improve the attraction and retention of local workers as these industries evolve. These SMPs will help to improve productivity and develop a strong Singaporean Core within our domestic sectors.

In conclusion, we want to thank the Member for his suggestions, especially in two areas. I shared over the last 10 minutes how MTI has been working with the relevant agencies to catalyse sophisticated demand in all these areas.

The opportunities presented by new and emerging industries are also on the agenda of review by the Committee on the Future Economy (CFE). In today's dynamic and changing environment, it is crucial that we constantly renew and revitalise our economy.

Mdm Speaker: Ms Low, you have one minute left; please round up.

Ms Low Yen Ling: The CFE is spearheading a national effort to identify new sectors and it will recommend strategies to position Singapore ahead. The Committee is consulting widely and seeking ideas and proposals from a range of stakeholders including the industry, academics, associations and chambers. On the drawing board will be critical success factors to forge new pathways for a better Singapore. And by working together, we can all chart a better future for Singapore and Singaporeans.

Mdm Speaker: Mr Perera, we only have 30 seconds left. Time is already up.

Question put, and agreed to.

Resolved, "That Parliament do now adjourn."

Adjourned accordingly at 6.54 pm.