Thursday, February 28, 2013

Tuas Power opens utility complex on Jurong Island

Tuas Power opens utility complex on Jurong Island

At the opening ceremony, Trade and Industry Minister Lim Hng Kiang said the plant has catalysed investment decisions by specialty chemical firms like Lanxess and Dairen.

The utilities plant, which runs mainly on low-sulphur coal and biomass like palm kernel shells and wood chips, is a critical piece of infrastructure on Jurong Island.

Since becoming operational in August last year, the facility produces steam and electricity to surrounding industries on the island.

It also provides water treatment facilities.

Mr Lim said: "With integration, companies are able to obtain feedstock and utilities, and supply finished products to other companies co-located with them on the island. In this context, Tuas Power's centralised utilities facility will strengthen Jurong Island's integration efforts."

Excess electricity will be sold through the Singapore electricity market. A desalination plant is also expected to be up and running by 2017.

According to Tuas Power estimates, operational costs of a coal-biomass power plant is 10 per cent less than a gas-fired plant, supplying cheaper utilities including steam to nearby synthetic rubber plants, which had to cope with high energy costs in Singapore.

Huang Yongda, executive vice president of China Huaneng Group, said: "This project is of great significance for Singapore to diversify its energy sources and increase its attraction for investment on Jurong Island. It is also of great importance for China Huaneng Group to deepen its international operations."

The S$2 billion facility is believed to be the largest investment by a Chinese company in Singapore. Tuas Power, which runs the facility, was acquired by the New York-listed Huaneng Power International in 2008 - two years after the plant was conceived.



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GMR to sell Jurong Island plant stake

BT understands that current owner GMR has put out an information memorandum through its financial advisers about selling its 70 per cent stake in the Singapore power plant to help the Indian infrastructure group reduce its debts.

[SINGAPORE] Singapore's newest power station - GMR Energy's $1.2 billion, 800 MW facility starting up on Jurong Island this year-end - is set to change hands yet again. This will take the number of owners that it has gone through to well over a half dozen since its inception in 2002 as the ill-fated Island Power project.

BT understands that current owner GMR has put out an information memorandum (IM) through its financial advisers about selling its 70 per cent stake in the Singapore power plant to help the Indian infrastructure group reduce its debts. Malaysia's national oil and gas company Petronas holds the remainder 30 per cent stake.

Sources said that GMR has apparently started talks with some industry players, including Singapore generation companies (gencos), on the sale which could potentially help it raise some $700-800 million.

"We've heard that it (the GMR Energy plant divestment) is in the works. We will participate when they float it," a genco source told BT.



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Tuesday, February 26, 2013

Singapore Budget Speech 2013 roundup

Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam bared Monday a government budget for the fiscal year starting April that he said aimed to ensure Singapore could achieve quality yet inclusive growth.

In a nearly two-hour speech, he detailed plans to make the tax system more progressive and further increase subsidies for lower-income and elderly workers in order to help improve social mobility.

He also disclosed measures to mitigate the country's reliance on foreign labour and to improve productivity.

Also, for fiscal year 2013, he projected that government would post a surplus of $2.4 billion equivalent to 0.7 per cent of GDP.

The speech comes amid public discontent over rising living costs and strains on infrastructure which many Singaporeans have blamed on the influx of immigrants over the past several years.

Here are the main highlights:

Tax changes

Personal income tax rebate announced for year assessment 2013, meaning income earned 2012.

Government will extend a rebate of 30 per cent subject to a cap of $1,500 to those below 60. Those aged 60 or above will receive a rebate of 50 per cent.

This year, to help household with cost of living, government will provide an extra GST voucher on top of the permanent GST voucher.

Health subsidies to be boosted.

Medifund will be increased by $1 billion to $4 billion and Eldercare to go up by a quarter million to $3 billion.

Government will expand senior mobility fund to cover a much wider range of devices such as hearing aids.

Cars with an open market value of above $50,000 will have an ARF of 180 per cent.

Property tax changes announced.

"I will make the tax schedule for property tax more progressive," he said.

Band for zero property tax will be widened. Property tax for high-end investment residential properties will be raised.

Changes to CPF. Employer contribution rate will be restored fully.

He bares enhancements to Workfare scheme.

WIS payments will be raised. Workers will receive 40 per cent of WIS in cash as compared to 29 per cent.

Workfare will now cover workers earning up to $1,900 from $1,700 ceiling. This will benefit 480,000 workers or 30 per cent of the workforce.

An additional $72 million will be put into Opportunity Fund for students from less advantaged backgrounds and will be extended to polytechnics. $300 million top-up to Edusave fund.

Government will more than double spending in pre-school sector to S$3 billion over next five years. It will expand capacity so pre-schools are closer to homes and bring more operators to the anchor operator scheme. Government will provide 16,000 additional places by 2017.

He talks about the need to address income inequality. He notes that older singaporeans make up 40 per cent of singapore workers in the lower income ladder.

Tobacco excise duties to be raised.

EDB will set aside $500 million for next five years to develop new frontiers in manufacturing.

Government will introduce a land productivity grant, which will be provided to companies that intensify land use or relocate some operations to immediate region.

It will also link up SMEs with research institutions to look into solutions that will give the SMEs a competitive advantage.

Productivity incentives will be provided to further boost training. Government will also launch an SME talent programme.

On road tax, commercial vehicles will get a 30 per cent rebate.

He bares a three-year co-funding package under the Wage Credit Scheme.

The government will co-fund 40 per cent of wage increases to Singaporeans with gross monthly wage up to S$4,000.

WCS payouts will be paid out to employers automatically and annually over three years. No application needed. The scheme will cost government $3.6bn over 3 years.

MOM will continue to tighten eligibility for Q1 pass holders.

Minimum S Pass qualifying monthly salary will be increased from $2k to $2.2k from 1 July 2013.

Dependency ratio ceilings will be cut.

DRC in services will be cut from 45 per cent to 40 per cent.

In construction, levy rates for less skilled Work Permit Holders in Construction Sector will increase by $150 between Jul 2013 and Jul 2015

He bares a new quality growth programme that will include:

Tightening of foreign worker policies through a targeted approach. All foreign worker levies will be increased 2014 and 2015.

Will introduce a special 3-year package to support companies.

Will help companies strengthen productivity through incentives.

Will develop capabilities to chart new frontiers in manufacturing and help companies seize opportunities in new growth industries in Asia.

The government can and will actively support all SMEs that are willing to upgrade. The restructuring of our economy must result in a dynamic and re-engergised SME sector, he said.

He says dependency ratio ceiling cuts will be made in sectors which are behind global productivity leaders. Levies will also be increased on industries most dependent on foreign workers.

"We will not increase levies for skilled workers. Most companies will not need to pay higher levies if they rely on skilled workers," he said.

Currently, foreign workforce makes up 33.6 per cent of Singapore's total work force.

Net inflow of 67,000 foreign workers in 2012, but most of the growth was in construction and the services sectors. In manufacturing there was in fact a slight decline, he said.

But in construction and retail, productivity is one-fifth below HK's.

He also cites greater strides in productivity. Three decades ago, he said Singapore's productivity level was 30 per cent of that of global leaders but now it is 70 per cent. It is now even greater than HK's.

He also bares greater investments for sports and culture.

Government will invest 30 per cent more in sports programmes over the next five years. The government will also create a fund to match investments for cultural programmes.

He announces enhancements to workfare.

Low wage worker will get a top up of his pay of 30%. This is in addition to what his employer will receive through new wage scheme that will encourage his employer to up the worker's pay.

Flexible working practices must be more important. We should also make it possible to give employees to be working from home or smart working centres near their homes. The government will help businesses in these efforts.

"If we do not do better in raising productivity... businesses and workers will be worse off.

We must help SMEs revitalise themselves," he says.

He notes that society is facing widening income disparity. "We must take further steps to temper inequality," he says. More must also be done to help seniors enter their retirement, he adds.

Our strategy for achieving higher quality of growth and an inclusive society are bound together, he says.

While fixing these problems, Singapore has to shift gears for an economy and society in transition.

He notes that there are pressing challenges on housing and transport.

The budget will introduce further measures to support our workers, especially lower-income workers.

Our budget for 2012 is expected to have a surplus. We expected S$1.3 billion but we now expect the higher surplus of S$3.9 billion due to higher revenues from stamp duties.

He maintains that Singapore's economic growth will likely range between 1 per cent to 3 per cent this year.


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Sunday, February 17, 2013

CHINA: Government makes progress in fighting pollution, says GlobaData, as Beijing becomes world’s most polluted city

(EnergyAsia, February 15 2013, Friday) — Despite its reputation for having the world's most polluted cities, China is making progress in cleaning up its environment faster than many people realise, according to a UK energy consultant.

Jonathan Lane, GlobalData's head of consulting for power and utilities, has compared China's current air pollution levels to some of the worst experienced during Britain's industrial era.

London's worst smog, or pea souper, started on December 6 1952, lasted for four days and is reckoned to have killed 12,000 in total, according to GlobalData.

Similarly to contemporary Beijing, London's weather was partly responsible for the smog, but the problem was eventually fixed by the Clean Air Act of 1956 which enforced the use of smokeless fuels and relocated power stations outside of cities.

"Progress towards resolving the situation in the UK was relatively slow," said Mr Lane.

"It is useful to contrast this with the challenges that lie before Beijing and other Chinese cities today and the progress they are making in improving air quality. The popular view is that Chinese politicians display the same attitude as Macmillan – burning coal and maintaining lax environmental policies in order not to damage economic growth. There are clear signs, however, that attitudes and development have changed significantly."

Chinese cities are choked by heavy levels of pollution from rising motor vehicle ownership and growing use of coal to generate electricity. Beijing recently claimed the world record for having the most polluted and toxic air when its PM2.5 fine particles content surged to a high of 993 on January 12, way above the 25 level deemed dangerous by the World Health Organisation (WHO).

Mr Lane noted that the Chinese government is actively promoting the use of natural gas to reduce air pollution in the country that will have impact in three areas.

Firstly, the conversion of coal-fired heating and electricity generating plants from coal to natural gas is nearing completion in Beijing, and will reduce air pollution significantly, as district heating plants must be located inside the city and therefore contribute to smog problems in winter.

The availability of natural gas to household consumers is also rising, with Beijing having around 4.5 million domestic gas connections, representing around 60-70% of all households.

Finally, compressed natural gas (CNG) is now available in Beijing, and the market is expected to grow rapidly. CNG has far fewer particulate emissions than either petrol or diesel, and will therefore help Beijing reduce its air pollution significantly.

"Natural gas consumption is growing rapidly across China as many cities look to reduce their pollution problems," said Mr Lane.

According to GlobalData, there were 108 million domestic natural gas connections in China at the end of 2011, up sharply from 19 million in 2010.


SINGAPORE: Senoko Energy completes S$1 billion programme to transform oil-fired plants to using natural gas

(EnergyAsia, February 18 2013, Monday) — Singapore's largest power company has completed a S$1 billion programme to transform three oil-fired steam plants into two gas-fired combined cycle units that will significantly reduce its greenhouse gas emissions. (US$1=S$1.25).

At a ceremony earlier this month, Senoko Energy marked the completion of its 32-month completed Stage 2 repowering programme that transformed the 250 MW oil-fired plants into a total of 862 MW of gas-fired power generating capacity.

Equipped with Mitsubishi Heavy Industries' latest F-class gas turbine technology, the new plants will enable Senoko Energy to reduce its carbon dioxide emissions by about 40% or up to one million tons per year. They will continue using piped natural gas and could switch to using liquefied natural gas (LNG) when Singapore's new import terminal starts up in the next few months.

Over time, LNG would account for about 20% of the company's feedstock, said Brendan Wauters, Senoko Energy's President and CEO.

"The completion of the project is a significant further step in the conversion from oil- to gas-fired generation, the new plant uses highly-efficient combined-cycle technology, and as part of the repowering concept a substantial portion of the existing equipment was re-cycled, re-furbished and re-used," he said.

"The investment we have made in these new units is in line with our vision to continue to position Senoko Energy as the leading energy supplier in Singapore. We are very pleased that reliable supply from the new units has started on schedule. We are also particularly happy that a strong safety record has been ensured throughout this complex construction project."

With an installed capacity of 3,300 megawatts (MW), Senoko Energy supplies more than a quarter of Singapore's electricity needs. As the nation's first power company to import natural gas for power generation in 1992, it launched a combined cycle plant in 1996 and was ISO 9000-certified in 1998, OHSAS 18001 in 2003 and ISO 14001 in 2004.

Senoko Energy is owned by an international consortium comprising four Japanese companies, Marubeni Corp (30%), The Kansai Electric Power Co Inc (15%), Kyushu Electric Power Co, Inc. (15%) and Japan Bank for International Cooperation (10%), and France's GDF SUEZ S.A. (30%).

S. Iswaran, Minister in the Prime Minister's Office, and Second Minister for Home Affairs and Trade & Industry, was the guest-of-honour at the ceremony.

Senoko Energy chairman Hajime Tsuda also spoke at the event.