(EnergyAsia, October 16 2012, Tuesday) — The following article features a Singapore International Energy Week (SIEW) 2012 interview with John Ng, CEO of YTL Power Seraya, the Singapore subsidiary of Malaysia’s YTL group.
Q1: How and to what extend has the power generation sector been affected by the economic crises of recent years? What insights and lessons have you gained which have wide implications for Singapore’s energy security?

John Ng: The unprecedented global financial and economic crisis of 2008 and 2009 had engulfed many Asian countries, including Singapore. In turn, it had impacted domestic electricity demand and supply. The cyclical economic cycle of 2008/2009 with an abrupt economic downturn followed by a sharp recovery had made it imperative for the energy industry to place greater emphasis on the timing of investment in capital projects as well as commitment to long-term fuel resources.

While Singapore’s energy security should be pursued with caution, one must also seek to appreciate the high cost of placing such a high emphasis on it.

Energy policies that seek to address the concerns of rising energy prices and climate change will seek to enhance the nation’s energy security. Yet, tradeoffs on competitive electricity prices to the consumers and consequently the social impact to the country must also be taken into account.
Q2: Your business operations, while largely Singapore-focused, are exposed to the variances of the global energy landscape. How has your businesses evolved in tandem with the changes taking place regionally and globally?

Ng: YTL PowerSeraya has always sought to move in tandem with the changes of the energy industry and has since grown from a pure generation company to an integrated energy with a multi-utilities offering, physical oil trading and fuel oil storage services.

As fuel cost is a significant portion of business cost, our trading arm PetroSeraya was set up to complement and grow our existing energy business. Its successful establishment has been one of YTL PowerSeraya’s key moves towards completing the value chain from sourcing to end-user.

The policy of reducing exposure to volatile world oil prices, and utilising our every asset such as tanks and jetties, has continued to grow the company’s whole value chain, with good success.

With the rise of global climate change issues, along with a global need for fuel diversification, we have over the years switched largely from the use of heavy fuel oil to natural gas. At the same time, we have voluntarily invested in cogeneration technologies that are deriving greater energy efficiencies.

We are also primed to be an active participant of the LNG market when the LNG terminal is ready in Singapore by 2013.

On a regional level, our parent company YTL Power also has operations in Malaysia and Indonesia. With our complementary expertise as a group, we will continue to explore the opportunities available in the region to enhance our energy portfolio.
Q3: As a genco, how are you working with your customers to increase the sustainability of their operations? At a broader level, what role do you see power generation firms playing in shaping a more sustainable future globally?

Ng: We believe efficient use of energy is key, with conservation of energy being the cornerstone to energy sustainability in Singapore. Through our retail arm, Seraya Energy, we have been working with customers on an ongoing basis to help them achieve energy efficiency and savings. This includes relevant energy solutions such as our Greenplus energy package which is bundled with energy management services to help customers improve their energy efficiency.

Our customer portal also provides real-time online access to bills and consumption reports and easy retrieval of customised reports so customers can better access and monitor their energy consumption. As part of our efforts to raise awareness and action on energy conservation, we also seek to educate customers on energy saving tips and to involve in them in our various environmental initiatives such as Earth Hour.

Power generation firms can seek to continuously place a strong emphasis on energy efficiency by taking a close look at energy sources, technologies, waste management and emission control, as well as resource conservation in their business operations.

In addition, power generation firms can work with their local government to support the growth of sustainable energy. Enhancing the company’s position by building a strong association to sustainable operations can also help influence customers to think of sustainability in their own operations.
Q4: The energy landscape is evolving in many different directions. From your perspective as a genco, how do you think the Singapore energy landscape will look like 20 years from today?

Ng: In the next 20 years, the local energy landscape will be dominated by the use of natural gas in highly efficient cogeneration plants, which is currently the lowest carbon-emitting fossil that the industry can use to generate electricity.

An ASEAN framework for electricity import may already be in place by then, which can help enhance Southeast Asia’s energy security through diversification of sources–allowing us even to tap on energy sources such as geothermal energy, which is not locally available.

To meet the region’s demand for energy, the focus will still be geared towards exploring more efficient use of fossil fuels and renewable energy, energy conservation and wider spread adoption of newer technologies such as electric cars, smart grids and microgrids.
Q5: In your opinion, what is the likely scenario that the US will export shale gas to the rest of the world? How do you expect that to impact your business?

Ng: While there is a high possibility, this will still depend largely on the US Administration that is looking to strike a balance between the economics of expanding gas exports and meeting internal shale gas demand such as in power generation and chemical producing industries.

With the completion of the LNG terminal, Singapore can seek to receive more gas supply from other sources. Coupled with the nation’s connectivity and infrastructure, the price of natural gas arriving into Singapore is also likely to fall, which can have a positive impact on business and the domestic consumers.