The sale of Temasek’s power plants does matter

15 Dec

The story has yet to catch fire yet within Singapore media or blogosphere though alarm bells should be ringing.

In a recent Straits Times article, ‘Power plant sold for $3.8b’, dated 3 December, Sabre Energy, a wholly-owned subsidiary of Malaysia, YTL, Power International Bhd, was reported to have acquired Temasek’s last power plant, Power Seraya. This came after the hurried disposals of Tuas Power in March for $4.235 billion to China’s Huaneng Group; and Senoko Power in September to Japanese/ French consortium, Lion Power for about the same amount, $4 billion.

Asian Power blog, in an analysis of  Tuas Power’s latest management’s decision to build Singapore’s first coal-fired cogeneration power plant after the sale, makes for perturbing reading. The writer (unidentified) quoted the World Bank that the tiny city state was already emitting 12.5 metric tons of carbon dioxide per capita compared to the global average of 4.3 tons.

The skeptic in me did a counter-check on the stated figures and discovered a confirmatory number from the UNDP interactive website. On carbon dioxide emissions – per capita in metric tons (latest figures available on 2004), Singapore’s stands at 12.3, which is close to what Asian Power claims. While Singapore has reduced its per capita input from 14.9 since 1990, it is are still one of the highest emittors per capita. To give the reader an idea of where Singapore stands, the US and Australia is at 20.6 and 16.2 as of 2004 respectively. Ethiopia, on the other hand, is at 0.1 tonnes.

As it is, clean coal is an oxymoron. Tony Regan, a consultant, who was interviewed by the blog commented that coal-fired plants leaves behind a much higher carbon footprint than the current method, not to mention, creating other environmental hazards. While 80 percent of this new outfit will be fueled by ‘clean coal’, the remaining output will subsequently be produced by  ‘biomass, chiefly woodchips and palm kernel shells’.

The decision by Tuas Power to use ‘clean coal’ and biofuels need to be desisted for it signifies a downward spiral move to a questionable technology.

In an article, ‘Red dot goes black?’, the blogger, Eugene, expressed worries on the environmental impact that the new plant may create:

We think it is highly possible that Tuas Power would take the coal route as it wants to tap on the expertise of Huaneng on coal and cut its costs before its competitors (such as Power Seraya and Senoko Power) also acquire new owners and become more competitive. Once there is a coal-fired plant in Singapore, the worry is that other power plants will follow suit and build more coal-fired plants as coal is still more cost competitive than oil and natural gas.

We are against the use of coal for generating electricity because coal is still a dirtier fuel source that emits more carbon dioxide, thus contributing to global warming. A cleaner coal-fired plant such as a modern Integrated Gasification Combined Cycle (IGCC) plant still emit about twice the carbon dioxide amount as compared to a natural gas-fired plant. The future zero emissions coal plant using carbon capture and sequestration technologies are still in research and not commercially available yet.

Moreover, Tuas Power’s decision to use biofuels is also socially irresponsible for they deprive otherwise agricultural lands from being used for growing food. This is especially critical when the world is facing food insecurity and crop inflation.

Biofuels are not more environmentally-friendly as it has been wrongly claimed by its advocates. One study conducted by a Princeton University’s environmental law researcher, Timothy Searchinger, discovered that ‘replacing fossil fuels with corn-based ethanol — the darling of the U.S. biofuel industry — would double greenhouse gas emissions for the next thirty years. Even switchgrass, seen as a far more efficient alternative, would produce a 50% bump in emissions’. Another research conducted by the Smithsonian Tropical Research Institute found that not all biofuels are equally eco-friendly. Malaysian palm oil and fuels made from US corn for example, are found to contribute more to global warming as compared to using fossil fuels.

And these are just the possible environmental repercussions that Tuas Power may create if it goes ahead with its new facility.

There are other issues at stake which will intimately affect the public.

Given that power is a ‘public good’ or at least a resource that benefits the general population, selling it to foreign corporations puts the national security at risk for it gives these foreign corporations a means of controlling an important asset. A simple calculation exercise shows that more than 80% of Singapore’s electricity generation capabilities would have been transferred to foreign hands in these three transactions.(1)

In addition, once these power plants are privatised and sold to foreign corporations, profit becomes an over-arching factor. The new owners are more likely to increase the price of electricity; impose lower labour and or environmental standards, which will pose a potential threat to Singapore’s fragile ecological system, hampered by its small physical size. It is a not an exaggeration to posit that small amounts of environmental pollution will have a huge impact on its habitable environment.

There is no doubt that the sale of Temasek’s power plant to foreign corporations should be on the radar of activists and opposition politicians. The public needs to protest against the transfer of an important public asset which could potentially cause irreversible environmental damage.



Below is a list of human rights and environmental violations cases associated with some of the foreign corporations that have bought over Temasek’s power plants:

* Huaneng Power, which bought over Tuas Power, has stakes in the investment of the Three Gorges Dam Project in 2002 which ‘has been criticised at home and abroad for its environmental impact and displacement of well over a million people’. The Tibet Justice Center documents this investment in Sichuan Huaneng Hydro Power Development which is used to ‘fund a dam project that the local people do not approve’. According to a report from the same organisation, an activist, Dolkar Tenzing, spoke to a ‘cadre from the Forestry Department [who] told us without any hesitation how the dam will destroy various endemic plant and animal species’.   In another report from Radio Free Asia, environmental experts are pressurised by the Chinese authorities to report favourably of this dam project, which is in Mugetso Lake in Sichuan Province (Tibet). Huaneng Co. is owned by Li Xiaopeng, the son of former Chinese premier Li Peng.

* Marubeni Corporation, which is part of the Lion Consortium, and owns Senoko Power, is part of a joint venture with Itochu Corporation in Burma. The Burma Campaign UK noted that this subsidiary, named, Myanma Steel Industries Co., Ltd, ‘supplies steel tubulars to the gas industry in Burma. Gas revenues are a major source of revenue for the Burmese regime, supplying over $2.7 billion in 2006’.  Marubeni also helps ‘finance the Monywa Copper mine developed by Ivanhoe’ in Burma.

*Another member of the Lion Consortium is Kansai Electric Power. It is ‘involved in the construction of a number of dams in Burma. Dam projects in Burma have been associated with forced relocations, extrajudicial killings, forced labour, death by labour and torture’. In Japan, it was criticised for the ‘nation’s deadliest accident at a nuclear facility’ which ‘failed to meet technical safety standards for piping in 78 cases at its nuclear plants’ according to a government inspection report. The incident killed five and injured six workers respectively in 2004.  Both Kansai and Kyushu Electric Power which are part of the Lion Consortium have also been pressurised to cut its oil imports in Sudan after an intensive global campaign on the country’s blatant and extensive human rights violations.


(1) Figures of above 80% are obtained by simple addition of the three power generating plants which was either extracted from its own website or news report. Power Seraya is reported to occupy ‘28% of Singapore’s electricity market‘  while Tuas Power has ‘25% of Singapore’s generation market’. In a Channel News Asia report, Senoko Power is said to control ‘over 30% of the nation’s electricity needs‘.


One Response to “The sale of Temasek’s power plants does matter”

  1. abao December 16, 2008 at 1:50 pm #

    Well, I do know that our National Power Generators being sold by Temasek for profits, which is ultimately detrimental to the Nation since power is a National resource and leaving it to market forces will put our Power at the mercy of foreign corporations to raise the price or cut our power should there be a need. Why no one raised the issue until now is not surprising given the recent economic slump and the high profile DBS High Notes 5 overshadowing other newsworthy bites, imho.

    That Tuas intends to switch to Clean Coal and Biomass fuels though is a new story to me. In such a densely populated country, what would be more detrimental to health than to put smog at our doorsteps? Does the Government want Singapore to become another Hongkong, where upon landing greets you with the repungent smell of smoke from coal powerplants and heavy industries? I hope not.

    Your afterwords are also disturbingly revealing in a sense. It seems like our Sovereign Wealth Funds loves doing business with Corporations that has interests in Rouge States. It can only serve to highlight our relative unpopularity with developed Nations in times of economic stability, imbo…

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