Category Archives: Commentary

Artificial Intelligence

I realise I’ve never written on artificial intelligence. GenAI swept the world quite a bit over the past 2 years and of course, the consciousness of it in the market since ChatGPT was made available for public use had driven Nvidia’s stocks up insanely.

I had realised that since I’ve got a collection of writings in the public domain from since 2009, it would not be hard for me to train an LLM to be able to almost think and write like me at least to the extent of views, ideas and information I have expressed.

The truth is I’ve somehow avoided using AI to do my work; rather, I’ve been using it more to gather and synthesize information, help me identify blindspots and figure out perspectives I might have missed. I know that what we have observed in the publicly available tools is just displaying a fraction of their potential and capability but I feel that ultimately, we are still hitting back at the same constraints that holds us back as humans. Resource.

AI continues to suck up computing power, materials and energy in order to work. This is almost silly to the extent that we are feeding machines copious amount of energy in order to produce output that pale in comparison with a human being. ‘Biological energy’ so to speak, is far superior and we already have the human brain that allows all of us to perform at a far higher and more meaningful level. Of course there are lots of ethical and safety issues confronting us as we develop AI further, and I’m not decided whether we should necessarily stop the developments – all I can say is that we are getting distracted by AI.

We are embarking on an almost insane hype in the market for AI while ignoring the greater problem that confronts mankind today – climate change. And we ignore it at our peril. AI, like the many other engineered geopolitical crises, are chipping away at our attention, energies and resources to deal with the things that matters much more.

I really believe we can do so much better with the struggles and challenges in this world if we had not been distracted by these things. I have no doubt AI is going to be important and influential, but along with a lot of other innovations that have radically changed our lives, it may only serve to exacerbate problems that are still not well appreciated by us, while taking away resources to solve the problems that are apparent today.

AlterCOP29 Panel on Hydrogen

These days I more often talk about biofuels and bioenergy than hydrogen. Mostly because I believe that bioenergy is the best scaffolding that is available in the market for commercializing hydrogen for renewable fuel use massively.

I moderated a panel at AlterCOP 29 last year, where I help to spark some discussions about what hydrogen is good for and what could help hydrogen be a solution for decarbonisation, if at all.

There hasn’t been too much changes in fundamentals since we had that discussion but we know that a lot of bad news about hydrogen have plagued the industry since the start of this year.

Most recently, McPhy, the electrolyser manufacturer liquidated with most assets taken over by John Cockerill. One of the chief issues is that the industry has grown so much on the back of anticipated and realised policies without improving its commercial case over the same period of time.

As a result, the solution continues to be commercially challenging and expectations of handouts from government have reduced the drive to improve commercial case.

Airlines & SAF

It’s been a while since I’ve written and since coming back from a SAF conference last week, the challenges faced by the entire ecosystem continues to weigh on my mind. The most obvious challenge in the fact that producers (energy companies or feedstock suppliers venturing into SAF production) and users (airlines) diverge sharply on their views of what is a price that the market can exist and perpetuate at.

To me, this is a symptom of underlying issues including the fact that SAF mandates are crudely determined with a volumetric blend, and that more often than not, the mandates could just force all airports to try and adopt SAF as opposed to starting with some key nodes and rolling out to the minor airports. Or the mandates could just be fulfilled by airlines at the level of their fleets. Or in the case of domestic carriers and flights, all of the flights for that year of reporting. This allows airlines to meet the mandates flexibly. And the market can then optimise for the logistics of delivery as well.

Another issue with the volumetric blending mandates is that typically there’s a threshold of emissions reduction that the fuel must meet to be considered SAF, and the users will purchase just the cheapest one available. That means that producers are not incentivised to produce any fuel better than the mandated threshold. This throws up questions: whether you could blend a bit of A1 Jet fuel into a SAF with much lower carbon intensity than the threshold and then call it ‘neat SAF’? Tricky. And controversial.

At the end of the day, what are regulators and the economy trying to achieve? Decarbonisation. Is aviation important enough for policymakers to focus their attention? Yes and no. Yes because it is hard-to-abate and if no regulations are in place, they will just keep going and spew more carbon into the air. But no because ultimately, aviation emissions are only 2.5% of the global emissions. The proportion will surely grow as the rest of the economy decarbonises; so most of the approach now essentially is to throttle that aviation emissions growth.

Will throttling aviation emissions growth destroy aviation demand? Surely without a doubt. Should we do that only in places where there’s substitutes which are low-carbon (such as trains and electric transportation)? Perhaps. For individual government and agencies making decisions, ultimately, aviation is really not a huge area compared to most other carbon-emitting industries. There’s perception that aviation will have higher willingness-to-pay but I don’t think that should necessarily be the excuse to push the emissions reduction on them.

Again, those are just my opinions and musings for the week.

Governing authorities

I wrote this back during the period of 2025 Elections but did not post it. I put it up at this point just as a record of my thoughts.

Having gone through the general elections in 2025, there was a bit of reflection on how our faith plays a role in the manner we approach democracy and vote, especially when it comes to a world where, in the US, faith is increasingly politicised and used often as a means to gain political support. Gratefully, in Singapore, and also in Australia, the system pushes towards the center rather than polarising towards the extremes.

Nevertheless, as a Christian, it is essential to recognise the place of authorities from a faith perspective. And considering also how, as Christian voters, we approach the whole idea of elections. We have been called to submit to authorities of our land in Paul’s letters to the Romans – this was in the backdrop of authorities that were not democratically elected. So they probably had little respect for the people they ruled over – many of whom were foreigners who were their spoils of conquest.

And so when people go through the political route seeking to express and take action on their ideals, we could give them the benefit of the doubt and determine who best represents our voice. It is perfectly acceptable for two strong and devote Christians to come to different conclusions about who represents or aligns more with their political inclinations. What is important, is that the partisanship in politics do not contaminate or affect the unity of the church.

As a model for the society then, we ought to recognise and respect the democratic process as a means for us to determine as a society who will help to govern and what would be the priorities for the next term of government. If we allow the campaigns, the political lines or partisanship to poison the entire term of government, or worse, the rest of our lives, then we are probably missing the point.

Singapore energy transition II

Going beyond the energy system, there’s another important element to consider for Singapore as we are faced with a world in transition for the energy system. Singapore successfully built itself out to be a sort of energy hub even without domestic energy resources itself. In 2023, Singapore imported 145 Mtoe (million tonnes of oil equivalent) and exported 76 Mtoe. We basically re-exported more than what we consumed as a country for the entire year; and this is because we are largely importing petroleum products to be refined and then exported as more differentiated products. As an economy, Singapore earns the ‘cracking spreads’ from the refinery and drive the economy with that. Technically, it is the oil & gas companies running the refineries that earn that spread.

But more things happen after that, too. Because the refineries are left with a lot of heavy oils at the bottom of the barrel, we have lots of maritime fuels to spare, which coincides nicely with our large transhipment port facilities, together with our highly efficient port system that ensures a strong throughput. These advantages combine to allow Singapore to be the largest bunkering hub in the world. Bunkering refers to the refuelling of maritime fuel for the vessels calling at the port of Singapore. Storage terminals and other facilities will contribute to that.

With that scale, comes along a lot of other opportunities and economic activities that helps drive the economy. Vessels will call at the port to move the cargoes, which means that vessel services are required at the port. All sorts of cargo audit, verification services would be required. Engineering for vessel repair and overhaul could be added to the port city.

If we go back up stream to the refinery process, there are a lot of corresponding supply chain, derivative products that can all be based in Singapore, including some of the petrochemical production, wastewater treatment, waste oil recovery, centralised utilities services for the chemical plants. And it is not limited to manufacturing of course. There would have to be engineering firms, system integration firms, companies stocking up components for all of these plants including valves, flanges, and so on.

So while we can go on and on about the energy transition, when politicians and government think about their economies, there has to be some kind of rational and gradual shift rather than sudden evaporation of all of these activities. I don’t think we have clear solutions yet. For the past decade or so, government had left corporates to plan their own transitions, hoping to create friendly policies which will ‘help’ these corporates along their transition plan.

Now the issue is that the corporates tend to make big ambitious commitments when times are good only to realise they cannot be delivered as the resources they have is insufficient. Better yet, many of them set targets based on assumptions that simply does not hold in a low-carbon economy. So there is mostly empty talk, with no sticks or carrots to keep them in line. This is not just about discipline of executives and managers, but the ability of shareholders and other stakeholders to bear the costs of the changes necessary.

And then in 2020, Covid-19 struck and the government went full steam ahead with interventions, ushering an exceptional era where more expectations are piled on them to intervene directly and set regulations to push the world towards net zero. We all had hoped so through rounds and rounds of COP; but they really only started waking up a bit more during Covid-19. Yet the pandemic left us all weaker, with less resources to cope with the sustainability issues. When the funding and stimulus from the pandemic dries up, it seemed that a lot of plans for net zero had to take more of a backseat.

In Singapore we tried to ramp things up a bit more with the carbon taxes – despite how relaxed it actually is, there were still groans and moans – serious enough for the government to consider some kind of ‘rebates’. It seems to me that pricing carbon wasn’t really enough – just as setting up more tariffs was not going to cause manufacturing to magically re-shore back to America. There’s still a lot of coordination, capacity-building to do.

So let’s work together, and let’s devote some resources to consultants like my kind to help build that capacity and create that capability to moe into the next phase.

Singapore energy transition

As a strategy consultant devoted to the energy and climate transition, I spend a lot of time thinking about what is the pathway to transit our economy, and economic activities. A lot of the confusion and disorderliness arises out of poor understanding, misinformation and also uncertainties surrounding technology curves. Another reason is that we desperately want to get things right before we can make the move – this is a disease resulting from having too much information and failing to be strategic. Sometimes that is too late.

We have pretty much breached the threshold of 1.5 degree Celsius warming. That means we will have to decarbonise our economy while simultaneously deal with the consequences of climate changes within those temperature thresholds. We could fall into various positive feedback cycles that bodes ill for our climate systems. For example, we could be looking to manage the increased temperatures we experience by introducing more cooling, creating more comfortable indoor spaces that ends up throwing up more heat into the external environment, and also emitting more carbon dioxide in the process. I suspect it is already happening in Singapore.

I think an orderly and balanced transition isn’t about looking for the ultimate fuel or energy vector as our panacea. Even for Singapore, I dare say despite the National Hydrogen Strategy, it is very unlikely that we will be able to replicate our 95% natural gas strategy for our electricity system with something low-carbon. Unless it is biomethane but even then, there are doubts about the adequacy of supply. This means we will need to adopt different strategies.

I think for an energy system like Singapore, electrification may not always be a solution because adding more demand for green electricity to the grid would just make it harder to green our grid unless we manage to pull off an ASEAN power grid system where we can bring green power from anywhere in ASEAN and consume it in Singapore. Otherwise, if we assume a standalone grid system in Singapore that have projects offshore with dedicated connections to Singapore grid, it is better to focus on greening the existing electricity demand first, before looking at stepping up on electrification efforts (especially those where natural gas is currently being consumed).

The last thing we want to do is to electrify all our road transportation, only to have to import green hydrogen to be used to generate electricity to charge our electric vehicles. If that actually happens, then won’t it make more sense to put the green hydrogen directly into hydrogen-fueled vehicles instead? We want to minimise these inefficiencies and unnecessary round-trips. I think we need to consider first the anticipated electricity demand and the size of the system we will need over the next 2-3 decades, and make sure we are able to strike enough deals and do enough projects to meet that first.

Then separately, on the fuel systems side, the authorities will benefit from developing a clearer view of what our industries need. The industries are also transforming and trying to meet decarbonisation obligations, not just from the carbon tax introduced in Singapore but also pressure from other markets. By aggregating these needs and then looking at common infrastructure or aggregated deals that we can explore, we create more synergies and stickiness for the industries housed in Singapore. Whether it is renewable diesel, sustainable aviation fuel or biofuels for the maritime industry, these various fuels can be looked into more holistically for the demand pockets within Singapore to tackle them together.

We need to use the same attitude we have used for industry promotion and attraction to look at our energy system. Perhaps for the next leg of growth, the Energy Markets Authority will need to be parked under the Economic Development Board? Or at least they will have to be more coordinated and act almost as one agency in charting the needs and course ahead.

Primary energy fallacy

I think more people need to understand this concept that was attributed to Michael Liebriech, a thought-leader in the energy transition. Sam Hamels just wrote a pretty short explainer of its implications on Linkedin, which I encourage you all to read.

The assumptions are simple and does not address some of the other obstacles along the way but it is important that we should not be overwhelmed by the gross energy requirements in primary energy terms when we recognise that a lot of primary energy in the form of fuel are lost in the process of converting them into energy.

There are other obstacles along the way however, when considering that the most viable and economic renewable electricity sources are typically wind and solar, with substantial hydropower in the mix for certain geographies. These include:

  • Transmission and distribution infrastructure:
    • Hydropower tends to be farther away from demand centers so the distance of transmission makes the infrastructure expensive
    • Wind and solar tends to be intermittent which means that a lot more needs to be transmitted during the times they are produced while the infrastructure remains underutilized when they are not available
    • Overall capacity will need to be increased compared to the fossil energy regime
  • Energy storage infrastructure:
    • While hydropower dams could benefit from becoming pumped storage, other renewables such as wind and solar will require significant energy storage in the grid in order to reduce the need to overbuild (because of the point above)
    • Energy storage will also help provide the ancillary services for the electricity system as fossil plants retreat from the system (eg. reserve markets, frequency and voltage supports) while it becomes more volatile due to intermittent renewable electricity.
    • A lot more investment into stationary energy storage will be required. At least before the more lofty vehicle-to-grid concepts kick into place.
  • End-use system/equipment changes
    • To reap the benefits of the improved efficiency of an electricity based energy system, there will be a need to electrify more which means end-use equipment will need to be changed – assuming we’re trying to change a whole fleet of equipment with no regard to remaining lifespan, we are not properly using up our invested assets.
    • Typically, fuel-driven systems have longer lifespans than those driven by electricity – that may have to do with the fact that fuel-driven systems are more mechanical and have less delicate circuitry systems. Of course, that varies with specific use-case and appliance but what this means is that you might still face more frequent replacement, and the environmental cost of that might need to be carefully considered.
    • In some cases, the change in end-use equipment requires further infrastructure support. The most important example is electric vehicles, which need the support of a robust charging network – that must be supported by improved distribution networks in the grid.
    • Besides the grid, institutional improvements that properly allocate costs and reflect them to customers are necessary as well. Sometimes, it may make the transition harder as well. For example, the peak demand pricing of electricity markets drove a bakery in Queensland Australia to change their electric ovens to gas fired ones because they absolutely have to bake their breads in the early hours of the morning.

Now the reason I’m listing all these other obstacles is to challenge us to think through the solutions needed having convinced ourselves that we actually can work on getting enough supply into the system. There is still a lot of work to do to ensure this supply actually matches the real demand. Looking at gross energy terms is simply not enough, as evident from the primary energy fallacy itself.

SAF Pathways and value pockets

Today’s conventional wisdom around the Sustainable Aviation Fuel (SAF) market is that it will start with the HEFA pathway which converts oily waste compounds into jet fuel. The process is well established and economical. The challenge is aggregation of the feedstocks which takes the form either of used cooking oil and oily waste streams coming out of some vegetable oil production streams. They could also take virgin vegetable oil and oil from oilseeds to produce (but these tend to have a higher lifecycle emission associated with them as they are cultivated and will require fertiliser inputs and other resources).

The regulators and market expect that these feedstocks will be insufficient as the virgin oils should be reserved for food use and the waste-based feedstocks are limited. So then when the HEFA feedstocks supply goes down, prices of these feedstocks would move up towards the next SAF pathway. The popular contender after HEFA is the alcohol-to-jet (ATJ) pathway. They take bioethanol or methanol and turn them into jet fuel. This process is a bit more expensive, but because bioethanol is already being produced by various plants worldwide to supply provide for gasoline blending in countries with ethanol-blending mandate, it has a much more stable and ready market than used cooking oil.

Further technology pathways are expected to involve gasification where biomass is subjected to thermal processes that breaks down the material into constituent carbon, oxygen, hydrogen and nitrogen compounds, then reformed to make liquid fuels including jet fuel. These pathways are even more expensive, but their feedstock, which is pretty much any biomass, would be much more abundant.

So, the supply curve is expected to notch upward in discrete steps; once prices hit the threshold to unlock the next technology pathway, more feedstock will enter the picture and hence increase the supply of SAF available. This doesn’t mean that the earlier pathways will earn more margin, because the bottlenecks are the feedstocks; typically, the feedstock owners or aggregators tend to extract more of that value.

But this would mean that the prices of SAF should and can only rise as the mandate for more SAF and aviation decarbonisation becomes stricter and emission reduction targets become more ambitious. Now there is another transition to consider. That is a scenario where the chief driver of SAF adoption, regulations and blending would be decided by the market – but the outcome they are targeting would be based on proportion reduction of carbon emissions relative to conventional jet fuels.

Now of course, some from Oil & Gas players might think they can use carbon capture and storage to lower the fossil jet fuel intensity to meet the criteria. Yes to a certain limit; because the carbon dioxide emitted during the aircrafts’ journeys from fossil jet fuels will always been counted while the biofuel or synthetic fuel’s emissions will be zero (because they are short-cycle or biogenic carbon dioxide).

So I urge regulators and policy-makers; focus on the carbon intensity reduction targets, rather than volumetric blending targets.

Duty to vote

So it’s general elections season. It’s really interesting how this general election gives a great sense of a maturing democracy where more capable candidates are stepping forward, and emphasising the need to provide diversity of voices in the parliament. Peers of mine are stepping forward as candidates. I’m seeing even young independent candidates like Darryl Lo stepping forward.

The features of the Westminster Parliamentary system that Singapore inherited create a strong government because of the ‘first-past-the-post’ approach to voting. While the governing party can somehow gerrymander to optimise their support across constituencies, there is a natural limit to that as their vote share decreases.

The other feature is that the system calls non-ruling parties the ‘opposition’. It is perhaps a result of the typical debate terminology where they talk about proposition and opposition. As our democracy matures, we begin to see what it means more and more to be a loyal opposition, and not be misled by this somewhat ‘confrontational’ sense of the term.

Even as the country faces uncertainty from the global situation, this general election thus far fills me with a sense that Singapore is really ‘coming to age’ as a country that is learning to deal with challenges. Looking at the MPs coming from different walks of life and at a broader range of socio-economic backgrounds (at least from my perception), there is more a sense of ordinary people trying to make a difference in the society they live in, recognising it is no longer enough to slog for their own personal lives and expect the society to develop desirably.

Land resources

I don’t think we’re being imaginative or aggressive enough with tackling climate issues. Nor are we thinking about how to sync-up our efforts to grow our economies, improve lives together with environmental conservation efforts. There are plenty of false dichotomies that result from how we’ve developed our economies. It’s haunting us and discouraging us from thinking in worthy directions for problem-solving.

One example of a dichotomy that may turn out to be false in the long run is the issue of food versus fuel. The food shortage problems today is driven by logistics and localised disaster more than aggregate unavailability or insufficiency. If anything, instead of trying to outright ban dedicated energy crops or crop-based feedstocks for biofuel production, it would be wiser to encourage a programme of reducing desertification and farming of marginal land with resilient crops that can be used as feedstocks for biofuels.

Another involves questioning of thermodynamically-unappealing solutions. Direct air capture (DAC) requires that energy is so cheap that you should mechanically capture the carbon dioxide from the air with machines. And yes, it doesn’t take as much land per unit of carbon captured. It could even compete with vegetation/forests. One could consider through the lens of this competition with nature: Forests takes about 860 square km of land to absorb 1 million tonnes of carbon dioxide whereas if you were to build a DAC plant plus a solar farm powering it which can capture 1 million tonnes of carbon dioxide a year would only take about 30 square km, which is ~3.4% of the land area. [my calculations are back-of-envelope and derived from unit figures here and here].

Yes, but then what about the limited lifespan and all the value chain emissions from making solar panels and DAC systems? Indeed, those trade-offs are worth thinking about, which is why we probably won’t advocate replacing natural habitats and forests with DAC. A forest is more than just sequestering carbon, but also provides other ecosystem services such as enhancing biodiversity, increasing groundwater supply, and even helping to clean the water and reducing the risks of desertification.

At some level, biofuels compete with synthetic or e-fuels; and biomethane perhaps is imagined to compete with hydrogen. But all of these are false dichotomies. The world needs us to keep working on different solutions and coordinate our efforts to scale them where they make sense. One can be purist about different things and get nowhere. Let’s try to lay out the trade-offs and work through those in specific contexts rather than seek to rule out solutions on the whole.