Despite the challenges in utilizing natural resources such as land for large solar or fast-flowing rivers for hydroelectric power, Singapore has long been transforming constraints into opportunities to reach net zero by 2050. The island nation's nationally determined contribution was adjusted to accelerate its action in reducing emissions to around 60 million tonnes of CO2 equivalent in 2030. With this goal, Singapore defined a successful climate initiative as resolving the climate crisis and achieving energy security. This approach towards this net-zero transition requires fundamental shifts in the behavior of businesses, individuals, governments, and financial procedures. So what is the exciting driver in the Singaporean strategies toward net zero?
CONSTRAINTS IN ENHANCING SUSTAINABILITY ACTIONS
First, the net-zero transition requires collaboration in the community as a whole; this will impact individuals’ lives and business operations. Second, as the energy sources used nowadays still produce carbon emissions, it would be nearly impossible to reduce carbon emissions without finding new alternative energy. Last, even though many projects and innovations have been created, investment in climate action is still not enough to make those projects viable.
THE SINGAPOREAN STRATEGIES
The Singaporean government has, therefore, developed a triad of frameworks to tackle the challenges.
Carbon tax and Support schemes—this tax will be raised from the current $5 per tonne of CO2, equivalent to about $50 to $80 by 2030, and will be applied to cover about 80 percent of emissions in every industry. At the same time, it provides support schemes to help businesses become more energy efficient, help households with utility vouchers to lessen the financial impact, and encourage them to convert to more energy-efficient appliances.
Developing Alternative energy—this is to decarbonize the power sector, which accounts for almost 40% of all carbon emissions in Singapore. The initiative includes importing hydroelectric power from Laos since 2022 and investing in technologies for low-carbon alternative sources.
Green Finance—To meet the climate goal, closer collaboration between private capital, governments, philanthropy, and multilateral development banks is needed to close the funding gap. A vital part of this will require progress on the three fundamental issues: Data, Disclosures, and Definitions (3Ds). These 3Ds increase the credibility of the projects by providing complete and precise data, ensuring that the projects are not Greenwashing, and clarifying related vocabulary, such as what is considered “green.” With this, the investors will eventually participate in subsidizing those green innovations more. Additionally, 3Ds also serve as the foundation of making Singapore a green financial center that effectively directs green funding toward creating transitional projects throughout the region.
ADAPTABLE LESSONS
The examples of Singapore’s strategies emphasize that when creating policies, every government and organization should begin with identifying the constraints to create tangible goals. This will increase the possibility of making the execution well aligned with their sustainability goals and effectively solving the problems. Moreover, they must cooperate in closing the funding gap to make more projects and innovation viable. Businesses should place importance on transparency, such as providing annual sustainability reports. At the same time, the government must advance its financial procedures to support the move to sustainability. Most importantly, this scheme can be applied anywhere, not just in Singapore. In 2021, Bank of America mobilized and deployed approximately $250 billion in sustainable finance activity. It helped companies across industries measure and disclose how they address societal priorities through their business activities and operations.
These three initiatives are examples of vivid strategies that are crucial in driving Singapore’s actions to achieve the goal in 2030. The lesson from this is clear: the ability to turn constraints into opportunities by creating practical strategy is a promising element of sustainability.