Building a sustainable future: Singapore's multi-pronged approach to climate mitigation

For global warming to not exceed 1.5°C above pre-industrial levels, the world needs to cut greenhouse gas emissions by 60% by 2035. This ambitious target demands swift and unified action across countries, industries, and communities.

Singapore, despite being an alternative-energy disadvantaged country, is deploying a multi-pronged strategy toward achieving net-zero emissions by 2050 and build an enabling ecosystem for a low-carbon economy.

This article highlights several climate mitigation approaches that Singapore is taking to build a more sustainable future, including the implementation of mitigation policies, fostering private sector engagement, and advancing tangible actions in hard-to-abate sectors.
 

Overcoming alternative energy limitations through planning and cooperation

Although Singapore contributes only 0.1% of global emissions, it has established a clear path to reaching peak emissions by 2028 and achieve net-zero emissions by 2050. This timeline, shared in Singapore's first biennial transparency report submitted during COP29, reflects progress from its earlier target of peaking emissions by 2030.

Minister for Sustainability and the Environment, Ms Grace Fu, shared that Singapore’s unique circumstances as a small, densely-populated, and alternative-energy-disadvantaged country must be considered in its climate strategy and approach. Unlike other countries, Singapore faces constraints in implementing large-scale deployments of renewable energy. Therefore, its climate targets are focused on investments in research and development (R&D) and test-bedding to achieve technological advancements and improve the economic viability of low-carbon technologies, such as hydrogen and carbon capture and storage. Additionally, attaining effective international cooperation in areas such as carbon credits and renewable energy imports are crucial for Singapore to achieve its net zero targets.
 

Targeted approach to sector-driven decarbonisation efforts

Singapore's approach to climate change mitigation involves systematic decarbonisation across key sectors. The National Climate Change Secretariat (NCCS) develops and implements Singapore’s domestic and international policies and strategies to tackle climate change. This includes facilitation of mitigation initiatives to accelerate low-carbon transition through four key thrusts: (1) catalysing business transformation, (2) investing in low-carbon technologies, (3) pursuing effective international cooperation, and (4) adopting low-carbon practices.

An example of such a transition is in power generation, which accounts for 40% of the country’s emissions. With only three years to peak emissions, taking steps to decarbonise the energy segment is a top priority for Singapore. In that regard, Singapore has announced plans to import around 30% of its electricity from low-carbon sources, such as renewable energy plants, by 2035. Furthermore, the government has announced the establishment of a new Future Energy Fund with an initial injection of $5 billion to build the critical infrastructure needed for Singapore’s shift to low-carbon electricity. Singapore is also committed to generating 2 gigawatts of solar energy by 2030. A Whole-Of-Government initiative driving this effort is the SolarNova Programme, led by Singapore Economic Development Board (EDB) and Housing & Development Board (HDB), which is expected to contribute the equivalent of 5% of Singapore’s total energy consumption.

Beyond power generation, other key pillars targeted for decarbonisation include industry, transport, buildings, waste and water, and households. These efforts are underpinned by a carbon tax policy aimed at driving the transition to a low-carbon economy and fostering greater international cooperation.
 

Empowering the Private Sector for Global Climate Action

As part of global efforts to tackle climate change, Singapore provides a comprehensive framework to encourage and support companies in reducing emissions and aligning with international climate objectives. This approach integrates grants, carbon pricing, support for carbon services and capability development initiatives, fostering a collaborative pathway toward a low-carbon future.
 

Growing a Trusted Carbon Services Ecosystem

The multi-stakeholder carbon services and trading ecosystem in Singapore, comprising over 140 firms and growing, provides companies support through advisory services, carbon accounting, and the carbon offsetting expertise essential for companies’ decarbonisation journeys. EDB launched the Carbon Project Development Grant at COP29 to support Singapore-based companies in early-stage carbon project development and financing activities. The grant aims to assist established project developers in financing and originating carbon projects for Singapore, with a focus on generating high-quality Article 6 carbon credits. This initiative is designed to strengthen the regional supply of carbon credits for hard-to-abate sectors in Singapore. Eligible developers can receive support for activities such as feasibility studies, stakeholder engagement and carbon data collection.

Singapore’s Green Incentives for Businesses

To support companies in their transition and decarbonisation efforts, Singapore also offers a range of sustainability grants and support schemes such as the Resource Efficiency Grant for Energy (REG(E)), which encourages the implementation of energy efficiency projects and adopt energy-efficient equipment.

Progressive Carbon Taxation

In 2019, Singapore became the first ASEAN country to implement a carbon pricing scheme. Initially set at S$5/tCO2e for the first 5 years, the progressive tax system was designed to ease the transition for businesses while also incentivising low-carbon technology adoption. In 2024, the tax rose to S$25/tCO₂e, covering 80% of domestic emissions. After 2025, the rate is expected to increase to S$45/tCO₂e in 2026 and 2027, with a projection of S$50-S$80/tCO₂e by 2030.

Under the International Carbon Credit (ICC) Framework, businesses can offset up to 5% of their tax liabilities using international carbon credits. This is also aligned with Article 6 of the Paris Agreement. Singapore has also signed carbon credit agreements with countries such as Ghana and Papua New Guinea intended at allowing companies to invest in high-quality carbon projects.

Through these policies and initiatives, Singapore has in place a comprehensive and supportive environment for companies to actively participate in global climate action while enhancing their competitiveness in an increasingly carbon-conscious global economy.
 

Looking forward: Decarbonising the aviation and maritime sectors for a sustainable and future-proof business environment

The aviation and maritime sectors are key parts of Singapore’s economic scene. These two industries play a vital role in connecting Singapore to the world, facilitating trade, investment and tourism. Charting a course to decarbonise these sectors is essential to provide a progressive and responsible environment for investors and businesses aligned with Singapore’s commitment to sustainability and 2050 net-zero targets. However, achieving decarbonisation in these sectors presents a unique challenge due to their need for high energy density fuels for long-distance travel and heavy loads. Transitioning from conventional fuels requires substantial investments and time to overhaul the existing infrastructure for fuelling and maintenance.

Singapore has taken a committed step forward to decarbonise operations for each sector, with targets set for 2050. The Civil Aviation Authority of Singapore (CAAS) and the Maritime and Port Authority of Singapore (MPA) have introduced specific initiatives and enablers, including significant investments in R&D and ongoing consultation with business and industry partners.
 

Progressive Carbon Taxation

In 2019, Singapore became the first ASEAN country to implement a carbon pricing scheme. Initially set at S$5/tCO2e for the first 5 years, the progressive tax system was designed to ease the transition for businesses while also incentivising low-carbon technology adoption. In 2024, the tax rose to S$25/tCO₂e, covering 80% of domestic emissions. After 2025, the rate is expected to increase to S$45/tCO₂e in 2026 and 2027, with a projection of S$50-S$80/tCO₂e by 2030.

Under the International Carbon Credit (ICC) Framework, businesses can offset up to 5% of their tax liabilities using international carbon credits. This is also aligned with Article 6 of the Paris Agreement. Singapore has also signed carbon credit agreements with countries such as Ghana and Papua New Guinea intended at allowing companies to invest in high-quality carbon projects.

Through these policies and initiatives, Singapore has in place a comprehensive and supportive environment for companies to actively participate in global climate action while enhancing their competitiveness in an increasingly carbon-conscious global economy.
 

Looking forward: Decarbonising the aviation and maritime sectors for a sustainable and future-proof business environment

The aviation and maritime sectors are key parts of Singapore’s economic scene. These two industries play a vital role in connecting Singapore to the world, facilitating trade, investment and tourism. Charting a course to decarbonise these sectors is essential to provide a progressive and responsible environment for investors and businesses aligned with Singapore’s commitment to sustainability and 2050 net-zero targets. However, achieving decarbonisation in these sectors presents a unique challenge due to their need for high energy density fuels for long-distance travel and heavy loads. Transitioning from conventional fuels requires substantial investments and time to overhaul the existing infrastructure for fuelling and maintenance.

Singapore has taken a committed step forward to decarbonise operations for each sector, with targets set for 2050. The Civil Aviation Authority of Singapore (CAAS) and the Maritime and Port Authority of Singapore (MPA) have introduced specific initiatives and enablers, including significant investments in R&D and ongoing consultation with business and industry partners.
 

MPA collaborates closely with like-minded governments, industry and academia to accelerate decarbonisation in the domestic maritime sector and in international shipping. Singapore has established six Green and Digital Shipping Corridors (GDSCs) with like-minded ports and countries to develop alternative fuel supply chains, scale green shipping pilot projects, advance digital shipping, and build consensus on global standards. The partners include Australia, Japan, the Ports of Long Beach and Los Angeles, the Port of Rotterdam, Shandong, and Tianjin, China.

To encourage the early adoption of zero and near-zero emission fuels and technologies, MPA has pledged a sum of S$50 million through the Maritime Singapore Green Initiative (MSGI) and is building an enabling environment for the supply and bunkering of alternative fuels such as methanol and ammonia. This includes the establishment of the Maritime Energy Training Facility (METF), supported by 52 industry partners, for training of the global maritime workforce in the operation of vessels using clean marine fuels. MPA has also entered into partnerships with international organisations, such as the International Energy Agency and the International Renewable Energy Agency, to encourage value chain collaboration and capacity building in the energy transition.
 

This is the third piece of our Article Series with the UNDP Global Centre for Technology, Innovation, and Sustainable Development (GC-TISD). Find out more about the series, read the first and second articles here:

Singapore’s climate action ecosystem for fostering sustainable development  

Understanding our climate: Singapore’s journey from data to action