Singapore Green Energy Transition ' Recent Developments

• Published date: 09 January 2023
• Subject Matter: Environment, Energy and Natural Resources, Energy Law, Environmental Law, Climate Change
• Law Firm: Akin Gump Strauss Hauer & Feld LLP
• Author: Mr Paul Greening and Jooyoung Song

This post delivers updates on some of the key recent developments in Singapore's energy transition landscape, building on Akin Gump's previous coverage on Singapore's efforts to develop its green transition initiative¹ and following on from our insights into the Asia Climate Summit 2022.

Article 6 Implementation Partnership

Singapore joined the Article 6 Implementation Partnership as a member country at the 27th Conference of the Parties to the United Nations Framework Convention on Climate Change (COP27) in Egypt, which aims to foster the trade of carbon credits and thereby advance the implementation of carbon markets around the world through coordination of international capacity-building efforts.²

Article 6 of the Paris Agreement allows countries to voluntarily cooperate with each other to achieve emission reduction targets set out in their Nationally Determined Contributions (NDCs) via transfer of carbon credits between countries. The new Article 6 Implementation Partnership launched by Japan's Ministry of the Environment during the COP27 conference will serve as an information platform for implantation of Article 6 and provide the support required to pilot Article 6 initiatives.³ At the time of launch of the partnership, 40 countries and 23 institutions have pledged to participate, and the partnership membership is expected to further grow in the future.⁴

As we highlighted in "Singapore: COP26 and Creating a Center for Carbon Trading", Singapore has been taking steps to establish itself as a carbon services and trading hub. Its participation in the Article 6 Implementation Partnership is one of such steps. As greater clarity on cross-border carbon market mechanisms will flow from implementation of the rules set by Article 6, this will in turn lead to an increase in demand for associated services (such as carbon financing and trading, verification of carbon credits, legal services and carbon credit risk management), which are all areas that Singapore has been keen to foster and promote.

Singapore's contribution to "the development of baseline methodologies for carbon markets and the promotion of the use of transparency tools and national frameworks for carbon markets"⁵ as a member of the Article 6 Implementation Partnership reflects its continued commitment to contribute to global greenhouse gas emission reductions, and we expect that Singapore will continue to play a vital role in supporting Article 6 implementation and facilitating international...