YTL PowerSeraya will import energy from Malaysia for the first time on a commercial basis, the company stated on Monday.
Over the course of two years, YTL PowerSeraya would acquire 100 megawatts (MW) of power from TNB Power Generation's gas-fired plant in Pasir Gudang, Johor.
TNB Power Generation is a subsidiary of Tenaga Nasional Berhad, the national electrical utility of Malaysia (TNB).
This would account for around 1.5% of Singapore's peak electricity usage, enough to power approximately 144,000 four-room Housing Board apartments every year, according to The Straits Times.
Through a newly strengthened interconnection between the two nations, the electricity will be exported.
Singapore's Minister of Manpower, Tan See Leng, and Malaysia's Minister of International Trade and Industry, Tengku Zafrul Tengku Abdul Aziz, were present at the signing ceremony for the cross-border electricity purchase agreement.
A spokeswoman for YTL PowerSeraya stated that the firm plans to begin importing from Malaysia in the second half of 2023, but that pricing information is confidential.
TNB and YTL PowerSeraya will collaborate closely with Singapore's Energy Market Authority (EMA) and Malaysia's Energy Commission to enhance all technical parameters and regulatory arrangements.
The agreement will take effect if all prerequisites are completed, according to the spokesperson.
YTL PowerSeraya was granted the power importer license for Malaysia in October 2021 for a duration of two years.
The firm is the only entity in Singapore with past experience in cross-border power trading and financial settlements, having supplied electricity to TNB via the interconnector in 2011 and 2013.
The deal is part of a two-year test to permit larger-scale electricity imports into Singapore, which intends to access regional power networks for greener energy supplies as it moves away from natural gas.
Malaysia now only authorizes the export of non-renewable energy to Singapore, therefore the provided electricity is produced from fossil fuel.
The representative for YTL PowerSeraya stated, "This is still an important first step in our readiness to import power from any source in the future."
John Ng, chief executive officer of YTL PowerSeraya, stated, "We think this is the first step towards our vision of a robust Asean power grid, in which electricity imports would eventually play a significant role in Singapore's energy mix."
YTL PowerSeraya is a Malaysia-listed subsidiary of YTL Power International that generates and sells electricity to TNB.
In 2022, the business paid $270 million in cash to acquire a gas-fired power plant previously held by the insolvent water utility Hyflux from Singapore's Tuaspring.
The facility increased YTL PowerSeraya's energy producing capacity by 396MW, bringing its total to 3,100MW and establishing it as one of the major power generation businesses in Singapore.
YTL PowerSeraya also distributes power in Singapore via its retail affiliate Geneco, which is one of Singapore's remaining electrical retailers after at least three others were driven out of business by high oil costs in 2022.
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