Launch of Regulatory Sandbox to Encourage Energy Sector Innovations
23 Oct 2017
Against the backdrop of a fast-evolving energy
landscape, a responsive and forward-looking regulatory approach can help spur energy
innovations for the benefit of consumers. To this end, the Energy Market
Authority (EMA) is launching a Regulatory Sandbox to enable the energy sector
to test new products and services in the electricity and gas sectors. This will
also allow EMA as the industry regulator to assess the impact of new products
and services before deciding on the appropriate regulatory treatment.
2. New products and services can include efforts to
leverage on new technology or apply existing technology in novel ways to create
value for electricity and gas consumers, or to improve business and operational
procedures. However, these ideas may not fit the existing regulatory paradigm
which was designed around a traditional power system. If innovators are unclear
whether an idea complies with regulatory requirements or is worth incurring the
cost of regulation due to uncertainty in the market viability of their product
or service, they may err on the side of caution by choosing not to proceed.
This could inadvertently stifle promising innovations.
3. EMA is encouraging more experimentation by enabling
such ideas to be tested through a Regulatory Sandbox. Innovators may submit
their ideas to EMA’s Regulatory Sandboxing for testing. A successful
application would allow the idea to be applied in the market, while being subject
to relaxed regulatory requirements. At the same time, safeguards (such as
limiting the duration of the trial or the maximum number of consumers) can be
introduced to minimise risks to consumers and industry.
4. The evaluation criteria for ideas applying for
the Regulatory Sandbox include whether the proposal:
i. Uses technologies/products in an innovative way;
ii. Addresses a problem or brings benefits to
consumers and/or the energy sector;
iii. Requires some changes to existing rules; and
iv. Has assessed and mitigated foreseeable risks.
(See Annex for full list of criteria)
5. On the impetus for this new Regulatory Sandbox,
EMA’s Chief Executive Ng Wai Choong said: “EMA would like to encourage more
experimentation in the electricity and gas sectors, so that promising
innovations can be tested and have a chance for wider adoption in Singapore and
abroad. At the same time, the Regulatory
Sandbox will help EMA adjust its regulatory frameworks to keep pace with
advances in technology.”
6. The Regulatory Sandbox will complement ongoing
Energy Research and Development (R&D) initiatives, by providing a platform
for R&D projects to be tested on a broader scale in Singapore.
7. Interested parties who wish to experiment with
their innovative energy solutions within a defined space and duration may write
to Sandbox@ema.gov.sg or visit the
microsite at www.ema.gov.sg/sandbox, for more information.
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