Mr Zainul Abidin Rasheed, Chairman of Diamond Energy

Mr Dallon Kay

Ladies and gentlemen

A very good afternoon to all of you. I am very happy to be here to join you at the opening of Diamond Energy's Demand Response Centre.

I would like to first extend my heartiest congratulations to Diamond Energy for setting up this first dedicated facility of its kind in Singapore.

In Singapore, almost all our energy supply is currently imported.  We have to continually look for ways to diversify our energy sources to enhance our energy supply security and cost competitiveness.

At the same time, it is also important for us to look at different ways for consumers to enhance their energy efficiency for sustainability. There are many benefits that come along with this: enhanced energy security because we import less fuel; improved price competitiveness because we pay less; and of course, from an environmental point of view, this is also better for everyone.

In this regard, demand response provides an effective platform for consumers to actively manage their energy consumption in a cost-effective and automated manner.
 
Demand response programmes have been successfully implemented in countries such as the US and Australia. 

Worldwide, there are more than 10 million sites providing demand response. Market research has shown that the market potential of demand response is estimated to grow up to 155 TW by 2020.

Demand Response in Singapore

We have worked with key industry stakeholders to develop a Demand Response Programme for Singapore. It is on track to be launched by end 2015.  

The Energy Market Company is currently working on system changes that will allow demand response to start on target by that time. So through this Demand Response Programme, contestable consumers can participate not just in the reserves market, currently available through the IL (Interruptible Load) scheme, but also in the wholesale market. And they can get paid for reducing or shifting their loads when the spot electricity prices are high. 

Let me briefly explain how the Demand Response Programme will work to benefit consumers. 

• This will be open to contestable consumers. Those who can reduce at least 0.1 MW of their load are able to participate in the programme.
• They can do so directly by themselves, or for many of them, because this is not their core business, they can also do it through a demand response aggregator like Diamond Energy.
• The offers will be submitted for the demand response provider to reduce demand when spot prices are high.
• If these bids are being scheduled, the demand response provider will proceed to reduce its loads accordingly. In return, it will get paid for helping to reduce the electricity price for all consumers.

So over the long term, our belief is that this is a very useful feature to have in the market for the reasons that I mentioned earlier. It will help to enhance energy security and reliability. It will help to further reduce the price impact on consumers, to avoid prices spiking to very high levels during periods when there are supply constraints. And this is also helpful from an environmental point of view.

Demand response will provide more options for consumers to actively manage their electricity cost and to be able to promote greater competition in our electricity market. 

With companies such as Diamond Energy offering innovative demand management services, including demand response services, we hope that consumers will be able to tap on these options to be able to reduce their electricity cost while improving system efficiency.

I am also very happy that Diamond Energy has won an award for Power Retailer of the Year for Asia Demand Response Aggregator. This was at the regional Asian Power Awards in September this year, given in recognition of the company's pioneering efforts in Singapore and Vietnam.

Diamond Energy was the first company in Singapore to market itself as an aggregator for IL. In Vietnam, the company has also done well and was lauded for its ongoing work to design, implement and manage a Demand Response pilot in Ho Chi Minh City – this is also the first of its kind in the country.

Smart Nation with Smart Buildings

Last year, Diamond Energy collaborated with Siemens to launch the Siemens Centre in MacPherson.  I was glad to witness the launch of that collaboration. 

The pilot project aims to demonstrate the feasibility of demand-side management systems and operations in commercial buildings.

I am happy to learn that the pilot project simulations look promising, and these include ways to reduce electricity consumption, for example by curtailing some of the air-conditioning systems in the building during certain periods.  And I believe there's room for more of such good ideas to emerge, and I would like to urge Diamond Energy and Siemens to continue to press on with their collaboration.

Conclusion

The opening of Diamond Energy’s Demand Response Centre is an important milestone to help consumers realise the benefits of demand-side management in Singapore.

This is not the only demand-side management tool that we are going to introduce. There will be many others, including provision of information to consumers to keep track of their energy consumption through smart meters and home energy management systems.

These are all ways to help people to reduce their energy demand, and hopefully through that, to achieve benefits for consumers and also the system as a whole.

I hope that such options and developments will encourage more businesses to consider adopting demand-side practices to reduce their business costs, which will be a win-win arrangement for them and their customers.

I am certainly delighted to hear Mr Zainul sharing the target for Diamond Energy to sign up 50 MW of demand response capacity next year, to coincide with the celebration of Singapore’s 50th anniversary.  If I may set a further challenge for you, it is to try and achieve a target of 88 MW by 2018!  

Let me conclude by congratulating Diamond Energy on the launch of the Demand Response Centre. I wish the company, management and staff continued growth and commercial success.

Thank you very much.