Going green: The state looks to make its industries more environmentally friendly

Though abroad it might be best known for its substantial hydrocarbons reserves, at home Brunei Darussalam’s authorities are also turning their attention to renewable energy sources and efficiency drives in a bid to “green” the economic growth. Conscious of its regional environmental commitments, the Sultanate is likely to witness substantial investment in renewable energy technologies during the coming years.

BIG NUMBERS: Brunei Darussalam may not be a huge consumer of hydrocarbons in total volume, but with a small population, a power generation network wholly reliant on fossil fuels and a high reliance on automobiles, the country stands out as one of the worst polluters in the region. According to a 2010 report by the Asian Development Bank (ADB), Brunei Darussalam had the highest per capita carbon dioxide emissions out of all Asian economies in 2007, at 19.8 metric tonnes (ahead of Australia, with 17.9 metric tonnes per capita, and Kazakhstan, with 14.8 metric tonnes per capita). By 2009 carbon emissions had reached 23.7 metric tonnes per capita. Although this was a slight decrease on its levels in 1990 (25 metric tonnes per capita), it was still well above the non-OECD high income country average of 14 metric tonnes per capita.

As such, the country is now trying to reduce its carbon footprint by bolstering its renewable energy capacity and reducing energy intensity within the economy. Given that Brunei Darussalam is an integral part of ASEAN, which has committed to a level of 15% of total installed power to come from renewable sources by 2015, the country has found new focus on renewables potential within the Sultanate. For Brunei Darussalam itself to reach the 15% level under ASEAN commitments it would need to produce more than 50 MW of power from renewable sources. Currently, the Sultanate has a renewable generation capacity of 1.2 MW.

CHANGING TIMES: However, things are beginning to change. The current 1.2 MW is generated by the new Tenaga Suria Brunei solar plant in Seria, commissioned in May 2011. Run by photovoltaic (PV) panels, the new plant is seen as a pilot. As of May 2012 it produced enough power to supply 200 homes. Indeed, the plant is the largest photovoltaic test plant in South-east Asia and could pave the way for further investment in solar generation within the Sultanate. The minister of energy, Pehin Dato Yasmin Umar, told local press in August 2012 that the plant is “a small but important first step in the development of renewable energy sources”.

Run by Mitsubishi, the plant is currently testing a variety of PV technologies to assess efficiency in local weather conditions as well as training local staff on the operation and maintenance of a solar plant. Although it is a small initial step, the Tenaga Suria Brunei plant is expected to save some 340,000 litres of crude oil each year, equating to a reduction in carbon dioxide emissions of some 960 tonnes. This is the equivalent in absorption power of about 260 ha of forest.

The government is also looking at a number of other measures to increase renewable usage and reduce carbon emissions within the country. The Energy Department at the Prime Minister’s Office (EDPMO) has stressed the importance of the roll out of a smart grid and the introduction of a feed-in electricity tariff as key step forwards for the country’s renewable energy outlook in 2013 and into the medium term. The feed-in tariff would create an incentive structure to allow residents to invest in renewable energy for their homes, offering a repayment system for the energy that they produce from renewable sources.

A BIG PUSH: While the specifics and pricing and payment have not been announced, the government has put its weight behind the idea of consumers selling excess energy, produced from solar panels for example, back to the grid. Pehin Dato Yasmin told local press recently that “this as a wise investment. A solar panel has a 20- to 25-year life cycle, so maybe after 10 years consumers will get their return.”

The smart grid fits into the government’s emphasis on energy efficiency and conservation. The technology creates a digitally enabled grid that gathers and acts on the behavioural patterns of consumers and suppliers to create a more efficient generation, transmission and distribution system. Details in terms of timeframe and investment size are not yet available.

MANY BENEFITS: However, the government has repeatedly emphasised the potential benefits and practicality of a smart grid. Singapore already employs such technology and the government believes, given the size of the Bruneian market, that it can replicate the success of its regional counterpart.

Indeed, the smart grid is not only likely to improve efficiency but also reduce electricity bills for general consumers and industry. It may even expand into foreign markets, though there are still challenges. “Singaporean companies have been doing business in Brunei Darussalam for a long time and now it’s time for Singapore to allow Bruneian companies to grow in their back yard,” Rudy Borhan, the general manager of QOS, told OBG. “Among Brunei’s neighbours some of the toughest markets to enter are Thailand and Malaysia. In Malaysia, for instance, the government insists on minimum local shareholding of 51%.”

The government has put energy efficiency at the top of the national agenda. In August 2012 the minister of energy told the local press, “energy efficiency and conservation is one of our priorities because, based on true market value, we are spending $2bn a year to meet the country’s overall energy demand – and this is expected to grow to more than $5bn by 2035, under the ‘business as usual’ case.” Indeed, efficiency is becoming an increasingly recognised global trend. In the US, for example, consumption as well as generation is now a key consideration in energy policy.

KEEPING THE PLEDGE: According to the energy minister, citing UN data for 2001, the Sultanate’s energy consumption per capita ranked 12th out of 198 countries and is the highest among ASEAN states. Nevertheless, the country has pledged to reduce its energy intensity by 45% by 2035 in line with pledges by the Asia-Pacific Economic Cooperation forum leaders in the Honolulu Declaration of 2011. As well as the smart grid, the government is also looking at improving generation systems (co-generation) for its gas-fired plants and has already amended the electricity subsidy scheme to place a greater financial burden on heavy consumers.

The government has also taken tentative steps in the transportation field. Consumption in the sector has been on the rise. Total petrol consumption (of varying degrees) reached 323m litres with a value of BN$152.9m ($119.1m) in 2011, according to the JPKE. Premium petrol consumption increased by 5.9% to 1.55m barrels in 2010, the latest year for which statistics are available. Diesel saw an increase of 10.04% to 1.85m barrels in the same year. The EDPMO is looking at plans to introduce 100 hybrid and electric cars into the market in a bid to raise awareness of energy efficiency and make the technology competitive with petrol and diesel.

While it is still early days in the renewable strategy, the government is beginning to take steps to reduce its carbon footprint and become more efficient and sustainable energy consumer over the next two decades.