Electricity Power Generation Capacity
Ministry of Trade and IndustrySpeakers
Summary
This question concerns historical and projected electricity generation capacity and strategies to maintain a 27% reserve margin. Mr Chua Kheng Wee Louis inquired about capacity shifts, leading Minister Gan Kim Yong to state that capacity decreased from 13.5 GW in 2018 to 11.8 GW in 2022 while maintaining a 50% reserve margin. The Minister noted that capacity will remain steady until new units enter in 2025, with the Energy Market Authority introducing a centralized competitive tender for private investment in new generation capacity. To safeguard system reliability, the Energy Market Authority will facilitate these investments or build the required capacity itself if private sector interest is insufficient.
Transcript
5 Mr Chua Kheng Wee Louis asked the Minister for Trade and Industry (a) how has electricity power generation capacity changed in the last five years; (b) what is the projected capacity in the next five years; and (c) what are the plans to ensure that the required reserve margin of 27% is met in the next five years, assuming the upper bound of projected system peak demand is reached.
Mr Gan Kim Yong: Over the last five years, the total installed generation capacity has decreased from 13.5 gigawatts (GW) in 2018, to 11.8 GW in 2022, with the retirement of older power generating units. This is higher than our current peak demand of around 7.8 GW. The reserve margin, which provides for planned and unplanned outages of generating units to safeguard the reliability of our power system, is currently around 50%. This is above the 27% required reserve margin (RRM).
Generation capacity is expected to remain around the current levels over the next few years before new generation units enter the system from 2025. While we can expect the reserve margin to tighten over the next few years due to increasing demand, there will be sufficient generation capacity to meet the RRM of 27%.
The Energy Market Authority (EMA) has been encouraging generation companies to build more capacity to meet growing demand. In August 2022, Keppel Infrastructure announced plans to develop a 600-MW advanced combined cycle gas turbine power plant. To ensure sufficient generation capacity over the longer term, EMA will introduce a centralised approach to facilitate and guide private investments in new generation capacity through a competitive tender. The tender will be conducted in advance of when the new capacity is needed, taking into account the lead time required for construction and development. Should there be inadequate interest to plant new capacity, EMA will build the required new capacity.