ESS-EMA-NCCS ESSAY COMPETITION 2012
“Identifying Opportunities and Powering Sustainable Growth in Singapore”
Chiu ChaiHao
Singapore Armed Forces,
Basic Military Training Centre, School 4
Abstract
Faced with challenges from growing resource constraints and threats from global climate change, there are nonetheless opportunities for Singapore to tap into. Leveraging on her socio-political stability, sound economic fundamentals and strong rule of law, Singapore is well-poised to obtain a global leadership in clean technology and urban management solutions. This is especially so with the urban populations projected to increase significantly in the near future, increasing the demand for this industry. Similarly, Singapore can become a centre for testbedding of clean technology and urban management, given our proximity to major markets and available infrastructure. Diversifying portfolio and exploring alternative energy sources are strategies towards achieving energy security, this essay advocates greater exploration into geothermal energy, a possibly neglected option. At the same time, innovative transport solutions such as experimenting with the bicycle-hire scheme will aim to alleviate the strains on public transport infrastructure, besides government investments. Eventually, while top-down approaches dominate the nature of policies in this essay due to the importance of government in this sector, education and involvement of the community since young helps to nurture a critical mass of talent pool and ensure the engagement of the locals in policy-making process.
Identifying Opportunities and Powering Sustainable Growth in Singapore
Climate Change and Energy Challenge: Threats to Singapore
In a single decade, climate change has transformed from a conjecture to an inconvenient truth. The Intergovernmental Panel on Climate Change (IPCC) reports that anthropogenic sources[1] of greenhouse gas (GHGs) emissions is the likely[2] source of enhanced greenhouse effect – best captured by the rising global carbon dioxide (CO2) concentrations and average temperatures.[3]
Figure 1: This graph, based on the comparison of atmospheric samples contained in ice cores and more recent direct measurements, provides evidence that atmospheric CO2 has increased since the Industrial Revolution. (Source: NOAA, NASA)
Figure 2: Global Surface Temperatures on the Rise. Four independent sets of data from various institutes re-affirm the enhanced greenhouse effect – which sees the Earth become warmer. (Sources: NASA Goddard Institute for Space Studies, NOAA National Climatic Data Centre, Met Office Hadley Centre/Climatic Research Unit and the Japanese Meteorological Agency)
A small, low-lying, island-city, Singapore is vulnerable to the effects of global climate change.[4] Higher temperatures, saltwater intrusion due to rising sea levels, loss of biodiversity and risks of food shortages are few of the multi-faceted impacts of climate change. This global crisis will reduce our quality of living and bring about huge economical impacts, ecological effects notwithstanding.
Being highly dependent on imported energy is yet another concern for Singapore. With rising world energy demand in recent years[5], given the price-inelastic nature of demand and supply, fossil fuel prices have increased sharply. With the trend likely to remain for the near future, the rising energy costs pose a serious challenge to Singapore’s economic competitiveness and growth.[6]
Opportunities in Sustainable Development and Recommended Policies
“When written in Chinese, the word "crisis" is composed of two characters – one represents danger, and the other represents opportunity.” - John Fitzgerald Kennedy
As the Economic Strategies Committee outlined, Singapore needs to “become a smart energy economy that is resilient, sustainable and innovative” to overcome the challenges and seize the opportunities in a sustainable growth path. While a sustainable growth path offer a plethora of opportunities, this essay propose strategies that the writer deems to be more relevant to Singapore.
Gains from a Sustainable Growth Path
Benefits from a sustainable growth path are far-reaching. While diversifying portfolio achieves energy security that underpins price stability, increasing energy efficiency helps to reduce firms’ operating costs and households’ living costs. These cost savings helps to achieve critical resource productivity gains that Singapore is in need of.[7]
Moreover, adopting a sustainable growth path, as will be explored later, confers Singapore with a competitive advantage[8]that allows her to benefit from the growing industry by developing her niche in the area.
- Achieving Energy Security – Diversification and Increasing Energy Efficiency
As an energy price-taker, diversifying her energy portfolio and increasing energy efficiency are the main thrusts that could insulate her from future price hikes.
Government policies are important in ensuring the diversification of energy portfolio since the free market will tend towards the lowest cost solutions. Also, thegovernment and government-linked corporations, by investing in the critical mass and providing for the high upfront costs, can lower the entry barriers and make the market more attractive for firms and providers.Infrastructure such as long-distance, high-voltage cables to import and export electricity from the region allow us to tap into the renewable energy sources of the region (e.g. hydroelectricity from the Mekong region).[9]
Looking into renewable energy for diversification, Singapore has limited options. The lack of major river systems, low wind speeds (below commercially-viable speeds) and limited land and sea space makes hydro, wind and tidal energy non-economical. Solar energy, meanwhile, remain as the focus of alternative energy development programmes given Singapore’s high insolation.
Even though renewable energy achieves security and sustainability, it is still unlikely to replace conventional energy sources given the high, albeit falling costs of production. Thus renewable energy (mainly solar) should constitute a small, but consistently increasing portion of total energy. Support for R&D efforts, test-bedding programmes will continue to grow in view of the opportunities arising from them, as will be covered later. Steady development in the relevant infrastructure allows Singapore to seize the opportunity to step-up energy production once solar power is more economically feasible than conventional sources.[10] (See Appendix 1)
Besides considering the feasibility of nuclear energy, the government should also commission a study on the feasibility of geothermal energy in Singapore. Both are less-explored options, but the latter is relatively cleaner, cheaper and less controversial.[11] However, the perspectives on the potential on geothermal energy are divided. While the National Climate Change Secretariat states that “prospects are low and uncertainties are high”[12], Geography and Environmental Engineering professors in National University of Singapore suggest the contrary, advocating a structured, comprehensive S$2 million feasibility study[13].
Simultaneously, increasing energy efficiency as a demand-management policy allow more to be achieved with less. Under the Sustainable Development Blueprint by the Inter-Ministerial Committee on Sustainable Development (IMCSD), Singapore aims to increase energy efficiency (energy use by S$GDP) by 35% from 2005 levels by 2030.As alluded to by the Stern Review on the Economics of Climate Change, the key drivers of policies to ensure energy efficiency are that of credibility, certainty – for they provide strong signals on the determination of the government, compelling the private sector to become energy-efficient.
In this light, the government should lead the private sector in the adoption of energy efficient technology, policy and practices. For instance, the government could set the standards for energy audit schemes that are gradually introduced to firms before making them mandatory. Hence, Singapore should providerelevant platforms (such as audit firms) for the private sector to adopt public sector initiatives.
Sharing of knowledge, best practices and establishing partnerships between SMEs and firms in the private sector could prove beneficial here, especially with the introduction of the Energy Conservation Act.[14] Greater energy efficiency across the sectors allow firms to be more cost-effective, achieving gains in resource productivity and making them more resilient in face of resource constraints.
- Promoting R&D Clean Energy and Green Technology
Given that science is a crucial part of innovation, Singapore should capitalize on its strengths in science and engineering, advanced R&D infrastructure and continue to invest heavily in scientific research, especially in the areas of clean technology and urban management. [15] Singapore’s unique conditions, coupled with the growth opportunities stated earlier, brings about growth potential for innovative solutions from our R&D efforts.
Singapore’s strong engineering base will allow it to branch out to meet the demands of sustainable growth paths. However, greater focus will have to be placed on R&D in clean technology and urban management solutions. This is by no means an easy task. As research on environment and sustainability issues are often and increasingly multidisciplinary, Singapore should provide more grants for its interdisciplinary research institutes, and focus on capability-building for the future. Capability-building, as will be described later, will begin primarily through environment and sustainability education.
- Global Exporter of Clean Technology and Urban Solutions
The global low-carbon industry is growing with greater awareness of the environmental challenges.[16] With climate change rearing its ugly head and rapid urbanisation in emerging economies (particularly in Asia) requiring efficient urban solutions,[17] scaling up existing investments in clean technology and sustainable industries[18] will help Singapore seize opportunities for research, businesses and jobs. This essay identifies export of clean technology and urban solutions as a key industry Singapore should establish a niche in, especially with her proximity to Asian markets and advantages in the region.[19]
Singapore should establish a competitive advantage in this niche area. Her unique geographical location allows businesses and investments from the West to reach the Asian markets with ease. Close to some of the largest tropical rainforests and sprawling urban centres, there are huge opportunities for R&D in the world’s oldest and most biologically diverse lowland forests for natural products as well as urban management solutions.[20] Leveraging on her business friendly environment, strong R&D infrastructure, socio-political stability and sound intellectual property environment that other regional cities have yet to rival will allow Singapore to develop her aforementioned niche to meet the burgeoning demand from developed economies and emerging markets.
Aligning itself with consumer markets of the future allow Singapore to remain economically competitive and relevant. While developed economies’ efforts in reducing budget and trade deficits will result in sluggish growth and declining trade importance, they are still significant for their technological edge and share of global GDP. Developing economies, meanwhile, represent the next wave of opportunities.[21] Increased integration within ASEAN will improve access to neighbouring markets, allowing ASEAN, with 601 million potential consumers to Singapore’s 5 million to become an economic hinterland for Singapore.[22] As the region moves towards greater economic development, economic opportunities in exporting sustainable solutions and expertise are indeed immense.
Already home to some 7000 companies, endeavours to attract MNCs and other Globally Competitive Companies (GCCs) should continue, especially for the clean energy and sustainable development sector. Singapore can become a high-end manufacturing, services and consultation hub in this areaby attracting MNCs and GCCs into Singapore, integrating local SMEs as part of the supply chain or strategic partners. Expansion of this industry will not only enhance export competitiveness, employment and growth, but also the inherent capacity of the country through technology and skills transfer. Sharing of best-practices and energy efficiency schemes can achieve cost-savings and critical productivity gains for foreign and local firms alike. Hence relevant statutory boards shouldactively nurture the business-friendly environment through incentives and schemes.
Yet the road ahead is not free of challenges. China has already signalled intention to develop theprofitable green industry as well, with generous state subsidies indicative of her interest to become a global leader in this field. However, intellectual property rights remain as the key deterrent of FDI from innovative industries into China. This makes it critical for Singapore to step-up her efforts in pursuing the sustainable growth path.
As a platform to Asian markets, Singapore can also act as a consultation services hub for firms seeking to invest in the region. Consultancy companies in consumer-related fields[23] can be attracted or nurtured to provide upstream research on consumer trends and demands in the Asian markets, as well as data-gathering and consumer-prototyping. Local universities and think tanks could play a part in improving the investors’ understanding of the region, such that products and services are tailored to suit the Asian markets.
- Global Testbed Centre for Clean Technology
The compact[24] and highly urbanized nature of Singapore makes it an ideal site for testbedding, experimentation and modification (as the ESC describes, the “living lab”) before commercialising and exporting the improved technology. It has been estimated that by 2030 two-thirds of the world population will live in urban centres, clear evidence of the growing demand for urban management solutions to house the population without straining the capacity of urban infrastructure.
Singapore is in good position as a pilot city for pilot-scale integrated systems to be built and trailed. Key precincts, such as the Marina Bay District, Treelodge@Punggol and Jurong Lake District have already become such test-bed centres.[25] In these centres, new concepts and prototypes developed at research centres and universities in collaboration with private sector partners can applied through government-supported test-bedding programs before their entry into regional and global markets. Leveraging on the abovementioned strengths of Singapore as a platform to Asian markets, we are able to (1) benefit from the range of sophisticated, cutting-edge urban solutions, (2) obtain new avenues of economic growth, (3) buttress the expertise in the related sectors of research, engineering and consultancy services and (4) assist the development of local SMEs in partnership with MNCs and GCCs. These benefits are evident from the successful example of aerospace industry. (See Appendix 2)
- Managing and Improving Transport Infrastructure
Developing a world-class transport system has been the main thrust of transport sustainability in land-scarce Singapore, since public transport impose a smaller ecological footprint than private transport. Yet recently, frequent disruptions to train services and alleged stresses to the Mass Rapid Transit (MRT) infrastructure have put public transport under-fire, especially since MRT is the main mode of communication. While the ongoing Committee of Inquiry will prescribe necessary preventive measures, we need to recognise that the total population increase has been too fast for the pace of development, construction and opening of new MRT lines.[26]
In terms of supply, replacement schedule for buses presentsopportunities as half the bus fleet needs to be replaced by 2016.[27]Adoption of clean and efficient engines for public buses should be mandated by government and subsidised if necessary, since the buses would cost more. This help to reduce costs for public transport operators, giving them greater capacity to absorb cost increases before raising fares.[28] Other benefits accrued transcend the financial aspect too. The Public Transport Council (PTC), for one, can assist the government to enforce minimum efficiency standards on the operators.
This essay also proposes the slow adoption of a nation-wide cycling program to complement the current public transport system. Bicycle tracks linking residential estates to key transport nodes such as MRT stations and key bus-stops allow commuters to reduce their carbon footprint and avoid congestion (and reducing congestion simultaneously). More bicycle stands and enhanced security features would be the first phase of the program, before developing into the bicycle-hire schemes seen in London and Dublin today.[29] A residential estate can be the first for testbedding of the new scheme, and public feedback, recommendations and improvements collected will allow smoother implementations at other estates in the future.
- Encouraging Community Participation and Stewardship through Education
This essay proposes environment and sustainability education, introduced to all sectors of the society ranging from pre-schools, schools, institutions and communities to engage a broad base of the population.
Currently, the concepts of environmental protection and sustainable development are integrated into the different mainstream subjects such as Social Studies and Geography. While this is still a reasonable approach, this essay also urges relevant authorities to study the feasibility of introducing the interdisciplinary subject of Environment and Sustainability Studies from Primary to Tertiary levels.Greater experimentation and innovation freedom should also be encouraged - students should to be allowed to propose, initiate and conduct projects in their schools with relevant support, or at least without excessive interference or restrictions. By imparting comprehensive knowledge about this subject, it plays a critical role for Singapore to nurture a greater talent pool in this growing industry.
Also, to equip students, adults and elderly citizens with knowledge on sustainable development and energy conservation methods also allow the government to achieve her goals of energy efficiency through a broad-basedapproach and enable the population to better appreciate and participate in related policies. While most of the approaches mentioned earlier are top-down approaches that have been the main mode of policy processes so far, recent political trends in Singapore has seen a greater demand for engagement of the locals in the policy processes.[30]Bottom-up approaches in policy-making is gaining traction locally, and rightly so as it involves and reflects the interests and insights of the relevant stakeholders.