Singapore limits Scope 2 REC claims to grid-supplied power

Singapore's Ministry of Energy, Trade and Industry has updated SS 673 so that companies claiming renewable electricity use must hold certificates tied to power delivered into the national grid.

The revision, reported by ESG Today, narrows which renewable energy certificates (RECs) can support market-based Scope 2 claims in corporate emissions reporting. Certificates from generation in Singapore qualify, as do certificates from approved low-carbon electricity import projects contractually supplied through a physical interconnection to the Singapore grid. Certificates from projects that do not deliver power into Singapore may not be used for those claims. An effective date was not disclosed.

For fund managers and allocators, the revised standard changes what counts as renewable electricity at Singapore assets, and therefore what the market-based Scope 2 line of a portfolio emissions report can include. A Singapore site whose operator has relied on certificates from projects elsewhere will need grid-linked supply instead, or a restated claim. Where a holding's certificates were generated, and whether the project sits inside the approved import set, becomes a diligence question.

A renewable energy certificate represents the environmental and non-power attributes of one megawatt-hour of renewable energy delivered to an electricity grid. Singapore launched SS 673 in 2021 to govern measurement, reporting and verification for certificate issuance, transactions and claims.

Gan Siow Huang, Minister of State for Energy, Trade and Industry, announced the update at the Asia Clean Energy Summit. The revised standard "will strengthen trust in corporate sustainability reporting and reduce the risk and issues of greenwashing concerns that we have heard," she said. Gan said the update aligns the standard with international practice and responds to business requests for greater clarity on what RECs represent and the claims they can support.

Gan said businesses may be willing to pay more for imported electricity with credible RECs, which could in turn improve the commercial viability of import projects.