SGEI, Danantara sign deals for 3.4 GW Singapore-Indonesia power link
Singapore and Indonesia have established the commercial groundwork for 3.4 GW of cross-border power links by 2035, creating new regional low-carbon electricity trade routes.
SGEI and Danantara Investment Management (DIM) have signed a memorandum of understanding to develop cross-border electricity interconnections between Indonesia and Singapore. The agreement targets the delivery of 3.4 GW of power projects on a commercial basis by 2035.
To channel this electricity to end-users, DIM signed separate agreements with Keppel Electric and Sembcorp Utilities to explore the offtake of imported low-carbon power. Sembcorp Utilities is a wholly-owned subsidiary of Sembcorp Industries, positioning the Singaporean energy firm as a key buyer of Indonesian renewables.
For infrastructure investors, the deals signal a maturing pipeline of capital-intensive subsea cable and grid projects in Southeast Asia. SGEI CEO Ong Teng Koon noted that "interconnections are the critical infrastructure that enables electricity trade between countries." He added that the partnership with Danantara Indonesia would focus on resolving the commercial and technical hurdles required to support regional power trade.
Realizing the 3.4 GW target depends heavily on bilateral regulatory alignment, a traditional bottleneck for cross-border energy. Both nations will now develop the specific policies, requirements, and investment conditions needed to facilitate electricity trade. Crucially, they will adopt a Cross-Border Renewable Energy Certificate (REC) Framework aligned with international standards. This mechanism is vital for utilities to verify and monetize the low-carbon credentials of imported power.
Singapore’s Minister-in-charge of Energy and Science & Technology Tan See Leng stressed that political backing is in place to clear remaining obstacles. “Several potential electricity export projects in Indonesia have made good progress,” he said. “With political will from our two governments and close coordination between the Ministry of Trade and Industry (MTI) and our Indonesian counterparts, I am confident that these projects can successfully navigate the remaining hurdles and commence operations within the decade.”
Leng noted the links will generate "spin-off benefits for our economies" and advance the broader ASEAN Power Grid vision. The involvement of Indonesia's sovereign investment arm Danantara, alongside established regional utilities, provides the institutional scale needed to underwrite these multibillion-dollar energy transitions.
