Singapore's Renewable Energy Transition: Unlocking Investment Opportunities in a High-Stakes Power Sector (2025–2035)

Singapore's transition to renewable energy is accelerating, driven by ambitious climate targets and a strategic focus on innovation. By 2035, the city-state aims to reduce emissions to between 45 and 50 million tons of CO2 equivalent while meeting one-third of its power demand through clean electricity imports. This transformation is reshaping the power sector, creating both challenges and opportunities for investors.

Policy Framework and Market Direction

Singapore's renewable energy roadmap is anchored in solar energy, with a 2025 target of 1.5 GWp of solar capacity and a 2030 goal of 2 GWp. Floating solar projects, such as the 60 MWp array at Tengeh Reservoir, are critical to overcoming land constraints, leveraging water cooling to boost efficiency by 11%. Beyond solar, the government is exploring low-carbon hydrogen, carbon capture, utilization and storage (CCUS), and advanced nuclear technologies to diversify its energy mix.

Legislative support is equally robust. The Energy Transition Measures and Other Amendments Act 2024 established the Future Energy Fund, which received an additional SGD5 billion in 2025 to finance high-risk, high-reward projects. These policies signal a clear commitment to decarbonization, attracting international capital through initiatives like the Green Investments Partnership, which secured USD510 million in committed capital from global institutions.

Market Dynamics and Key Players

Solar energy dominates Singapore's renewable market, accounting for 84.7% of the sector in 2024 and projected to grow at an 8.02% CAGR through 2030. Key players are capitalizing on this momentum. Sembcorp Industries secured an 18-year agreement to supply 75 MW of solar power to Equinix and expanded its footprint via a 300 MW solar acquisition in India. EDP Renewables, with over 30% of Singapore's installed solar capacity, is advancing floating solar projects in the Straits of Johor.

Cross-border collaboration is another growth driver. The Southern Johor Renewable Energy Corridor (SJREC), a US$6 billion initiative involving the International Finance Corporation (IFC) and Ditrolic Energy, will supply 4 GWp of solar and 5.12 GWh of battery storage to Singapore via the ASEAN Power Grid. Similarly, Singapore's partnership with Indonesia to develop a 2 GW floating-solar-plus-battery complex in Batam underscores the importance of regional integration.

Financial Performance and Investment Potential

The competitive landscape is moderately concentrated, with the top five players-Sembcorp, EDP Renewables, Keppel Renewable Energy, Vena Energy, and ENGIE Southeast Asia-holding 55% of installed capacity. Sembcorp reported SGD183 million in renewable earnings in 2024, while EDP Renewables' expertise in floating solar gives it a distinct edge. Keppel's strategic alliances, such as its partnership with Huawei to develop solar-plus-battery systems across ASEAN grids, highlight the sector's shift toward integrated solutions.

Investment opportunities are expanding beyond domestic projects. Singapore aims to import 6 GW of renewable energy by 2035, including hydropower from the Laos PDR-Thailand-Malaysia-Singapore Power Integration Project. This focus on regional imports, combined with Singapore's role as a green finance hub, is expected to attract further capital inflows.

Future Outlook

While land scarcity remains a challenge, Singapore's emphasis on floating solar, hydrogen, and cross-border infrastructure mitigates this risk. The renewable energy market is projected to grow from 1.7 GW in 2025 to 2.5 GW by 2030. For investors, the key will be aligning with companies that demonstrate innovation and regional scalability. Sembcorp's international acquisitions, EDP's floating solar leadership, and Keppel's technological partnerships position them as strong candidates for long-term gains.

Singapore's transition to a low-carbon economy is not just a policy imperative but a market opportunity. As the country bridges domestic generation with regional imports, the power sector is poised for sustained growth, offering investors a unique window to participate in a high-stakes, high-reward landscape.