A Green New Deal for Singapore

Singapore Green New Deal — spreadsheet emissions and economic model
FAQ guide
Presentation slides

A response to an earlier article by Assaad Razzouk, High time for a Green New Deal for Singapore

Singapore’s has several promising policy commitments on decarboniztion relating to expansion of solar capacity and modality shift in transport away from private vehicles towards pedestrian and public transport. There is still a long way to go however, while Singapore shares many of the general technical and social challenges of sustainable urban design with its sister cities in the C40 group, she is slipping behind in the race to decarbonize the city. For example, Copenhagen has pledged to be fully carbon neutral by 2025 and Singapore is only committed to peaking emissions by 2030–10 years behind the scientific targets.

Many of these cities have quickly adapted their ambition to match the challenge of the scientific requirements and are adopting policy measures that incentivise and facilitate the technology adoption and required social and economic transformations. To catch up to the rapidly increasing pace of the rest of her peers Singapore needs a fresh new approach to climate action and adopt her own Decarbonization Stimulus Act — using the global meme that epitomizes ambitions climate action policy — a Green New Deal (GND).

Given the complexity and scale of decarbonization policy there is not just one single set of policies, but rather there is a range of possible policies based on several basic assumptions and political philosophical approaches. These are the Green New Deal strategic policy choices introduceed in an earlier article and elaborated in more detail here. The most important policy strategy arguably non-negotiable is the area of greatest weakness for Singapore —the political will for ambition to meet scientific targets. As presented in this report, there is no valid argument to support such weak ambition, either from a technical or ethical perspective and the true underlying issue of debate comes down only to what the budget will look like and who would be the winners and losers in the new economy. These isssues are the central focus of the Green New Deal policy design.

Singapore’s largest gap — political will to meet scientific targets

The first and foremost gap of Singapore’s policy on climate change is the lack of political ambition to meet the scientific targets. According to The Intergovernmental Panel on Climate Change (IPCC) 2018, special report on limiting global warming to <1.5C states are recommended to :

Peak emissions by 2020, reduce by 45% by 2030, zero by 2050 and negative thereafter

These are the scientific targets. For Singapore, while there is an in-principle acknowledgement for government action on decarbonization, instead of meeting the scientific targets the government is content to impose soft Nationally Declared Contribution (NDC) — ( 36% reduction of emissions intensity per $ of GDP and stabilize emissions by 2030) — that it perceives is easy to achieve without any new taxes or spending, or disruption to established business interests on Jurong and Bukom Island. According to independent NGO Carbon Tracker, Singapore’s policy is consistent with a business-as-usual 3.4C warming track. This level is far from the scientific requirement and is considered well beyond what scientists consider as the safe limit of warming to sustain human life and civilization on earth as we have known it.

Singapore is not alone in moving slowly towards matching the climate change mitigation with the scientific targets. As stated by the IPCC in their 2018 report on global warming of 1.5C, the problem of decarbonization presents the global community with a challenge unprecedented since the post-war and independence era. The section for policy makers did not have a Singapore exclusion clause.

Pathways limiting global warming to 1.5°C with no or limited overshoot would require rapid and far-reaching transitions in energy, land, urban and infrastructure (including transport and buildings), and industrial systems (high confidence). These systems transitions are unprecedented in terms of scale, but not necessarily in terms of speed, and imply deep emissions reductions in all sectors, a wide portfolio of mitigation options and a significant upscaling of investments in those options

Conter-arguments to the rhetoric of national circumstances

Frequently the response from the National Climate Change Secretariat in defense of the low ambition is that Singapore is small, with limited resources for renewable energy using solar. As explained in another article, this excuse is a red herring — misleading for several reasons.

Counter-arguments to the small island excuse

1. Wealthy, powerful, technologically advanced city in the C40 alliance
2. 3 islands, 3 emission stories— Jurong, Bukom, and the Red Dot
3. Carbon Capture and Nuclear — technologically viable and land-efficient
4. Do our part — a global citizen ethical basis for allocating global emissions
5. Neoliberalism, unlike climate science is a philosophy not a science
6. Defining success, shift from income → to prosperity on political dashboard

A wealth, powerful city

First, Singapore is not small given that it is a city, and the most appropriate peer group is other cities in C40 which are not shying away from the scientific targets. It would be apples to oranges instead to compared Singapore to larger heterogeneous economies such as the US or China that have a mix of cities and rural hinterland regions, and some of which are bogged down in political partisan gridlock for federal action and being outpaced by faster mobilization happening at the grassroots levels in towns and cities. As a city Singapore stands out among it’s peers as a heavy carbon polluter with 8.1 tons CO2eq/year/capita of territorial emissions and potentially up to 20 tons for total emissions including imported emissions and bunkers from aviation and shipping. Furthermore, Singapore is one of the wealthiest and economically strong cities in the world, capable of leveraging substantial resources to combating climate change from finance, R&D and unmatched political capital for implementing rapid systemic changes within the city’s borders.

3 islands, 3 emissions stories

The next rebuttal to the tiny Singapore excuse is that 30–40% of Singapore’s emissions can be traced to 3 companies (ExxonMobil, Shell, PCS) in the petrochemical industry which in comparison to other industries like finance and the port have at best a loose connection to the rest of Singapore’s economy, representing just 3–6% of GDP and 1% of the total workforce. There is no fundamental “need” of any given city to have an economic mix that contains carbon polluting petrochemical industry, this is a policy choice and can be reversed given sufficient political will. This is fundamentally different from the problem of providing electricity for hospitals and running water to households, and these very different goals of the state should not be lumped together as “needs”. So Singapore’s largest obstacle to meeting scientific targets is to confront the reality that the petrochemicals industry as it operates today is incompatible with what the global economy needs to stay within the safe limits for a stable climate. Given the mounting litigation risks from the criminal historical role these companies have played in delaying action on climate change by funding public misinformation advertising campaigns, and the growing financial risk to the companies from the growing “carbon bubble” gap between oil and gas production projections and international climate policy targets, there are many good reasons to start thinking about an exit strategy from these sunset industries. According to the estimates, ExxonMobil would need to cut its operations by 55% and Shell to cut by 10% to align its business projections with the Paris Agreement.

Excuse me, you forgot something — Carbon Capture and Nuclear

Another misleading aspect of the excuse of Singapore’s limited circumstances is the exclusion two of the most appropriately suited technologies for a land-limited urban industrial center — Carbon Capture and Nuclear. When it comes to the climate crisis, all options must be on the table. While public perception of Nuclear is controversy and receives a lot of negative publicity from noteworthy disasters — Chernobyl and Fukoshima, Next Generation nuclear technology Gen III or IV have promising potential to overcome both the disaster risk potential and concerns about waste disposal. Furtheremore in comparison to the catastrophic potential of a warming climate, all risks must be considered in perspective. Nuclear is already one of the safest industries in terms of workplace safety, especially in comparison to the fossil fuel industry and is listed as a central role in the IPCC reports on pathways to 1.5C global energy transformation. Further information about the state of Nuclear technology is available in a report by MIT.

Carbon capture utilization and storage (CCUS) is the capture of concentrated carbon dioxide near the emission source and transport to a location where it can be stored for long period of time either underground in geological formations, in deep oceans or in some other permanent form. In contrast to Nuclear, CCUS has no real barriers to implementation asidee from costs, it is the most expensive carbon abatement option. CCUS does not have an intrinsic financial payoff and can only be implemented as a pure expense to operations, but can be implemented with high resource and land efficiency in a relatively short execution time once the budget is approved.

Doing our part — global citizenship ethics for emissions allocation

The next critique of Singapore’s National Circumstances rhetoric is the ethically questionable implied allocation assumptions about what exactly is meant by “doing our part”. The Paris Agreement fell short of specifying how global targets should be allocated to the national level, and the program is by design voluntary. There is no such legal black and white statement that specifies what Singapore’s emission reduction targets must be, so the state is free to set them arbitrarily as it sees fit with no recourse as to whether or not it is sufficient to meet the scientific outcomes or whether the allocation has an ethically just foundation. There are three logical methods to allocate emissions, based on land area, population, or a simple % reduction from a reference baseline year. Most states, Singapore included — appear to have adopted the third method in some form or another. The principle of climate justice embedded in the language of the Paris Agreement states that wealthier states with more resources have a higher burden of responsibility to reduce first and finance the emissions reduction for smaller, less developed states. While Singapaore may be physically small, economically it is a giant, particularly in the region and especially when compared to other C40 peers — and hence has a clear ethical burden responsibility to lead with ambition rather than be a meek fast follower.

Neoliberalism — more like a religion than a science

Next, Singapore’s resistance to meet scientific targets implicitly assumes a set of philosophical assumptions about the role of the state in the economy, which can safely be characterized as lassiez-faire, more technically — neoliberal. Lassies-faire economic policy calls for deregulation of industry, low taxes and places a high degree of idealogical faith in axiomatic assumptions about the nature of human interaction. The idealized thermodynamic models of neoliberal economists are founded on robitic rational decision makers replacing their actual human counterparts and the invisible hand of free markets that supposedly poses an unquestioned supernatural ability to solve a wide range of social problems. When confronted with empirical data to the contrary, neoliberals often respond by describing these as “market inefficiencies” which is another way of acknowledging the need for a strong role of the state to circumvent the prevalance of externalities. States that have leadership with Lassiez-faire leaning economic policies such as the United States and Australia are often associated with poor environmental performance controlled for their level of economic development. The reason for this is that lassiez-faire is vulnerable to under-pricing externalities and the most frequently neglected externalities cost is environmental conservation.

Around the world even from neoliberal economists, it is generally accepted that when it comes to the environment, it is the role of governments to regulate pollution so that the environmental costs are interalized into the pricing mechanism of the market. Singapore has implemented a carbon tax at S$5/ton which indicates that it recognizes this responsibility in principal, however the level of response is far below what is required for meaningful action which ExxonMobil has suggested by its “carbon proxy-cost” to be closer to S$100/ton. Carbon taxation is the preferred approach for the neoliberal schools of thought and despite Singapore’s commitment to supporting free markets it has yet to fully embrace this principle and internalizing the true externalities costs of carbon pollution into the local energy market.

GDP revisited — renegotiating the basis of the social contract from income → to prosperity

Finally, related to the neoliberal philosophy is the reluctance to embrace policy measures that are perceived to be risky to sustained annual GDP growth. According to recent report by the IMF in Sep 2019 the cost of climate change in a business-as-usual scenario is expected to be -23% of GDP globally, up to -80% in Southeast Asia and potentially infinite costs in the tail risks “up to and including human extinction”. In contrast, conserevative estimate of the GDP cost of mitigation from the highly cited Stern Review estimate a modest cumulative budget of 1–4% of GDP, which is modest in comparison to the potential costs of unmitigated climate change. Subsequent critiques of the Stern Review and the author himself noted that this is an upper-bound conservative estimate and likely to be lower due to unaccounted positive externalities from the interaction effects of social and ecological improvements.

Rightly or wrongly, the public and businesses have become conditioned over many years to expect elected officials to provide the assurance of income growth and this is considered explicitly and implicitly as the de-facto basis for the social contract. No matter the economic school of thought, there is strong empirical and theoretical evidence of a dependancy of GDP growth on the input of exergy. Exergy is useful work gain from external energy input. Both renewable energy and fossil fuel energy have the potential to provide free exergy, with different efficiencies and cost of other finite resources such as employment and land, natural resources and minerals. Fossil fuel is still a compelling abundant and resource-efficient form of exergy, but this exergy efficiency advantage is curtailed once the ability to freely emit carbon dioxide gas to the atmosphere is limited by carbon capture or economic penalties. So whether it is by limitation to pace of installation of new renewables or by forced implementation of carbon capture, the net result is likely the same of a curtailment of exergy inputs, and this legitimately calls into question the prospects of sustained pace of GDP growth based on the current economic model. While the case is compelling of theoretical evidence that alternative “decoupled” models of GDP growth may exist on paper such as to increase the share of creative, intelligent and digital services, it remains as an open challenge to present a working at-scale demonstration of this theoretical concept. Fortunately, GDP is widely acknowledged as an outdated, superficial national metric the state can chose whether or not to continue to adopt as a national ambition, and other measures of prosperity exist that may be a more true reflection of the fundamental social contract between state and society such as the Historical Index of Human Development (HIHD) and have less of a dependancy on income, and hence exergy inputs.

The ambitious aims of the Green New Deal however, is at a minimum to put into place the economic policies that minimize the risk of income disruption of the economic tranformation — a smooth landing rather than a crash. The GND does not stop there however, and aims to do the impossible. The ambition of the GND is that if well designed and executed a rising star technologically advanced city like Singapore with ample cash reserves and a highly educated workforce has the potential to “have your cake and eat it too” by growing real household income and at the same time achieving scientific decarbonization targets, with a more agnostic approach towards growth of incomes for high income households and businesses which have benefited for years from the previously under-priced carbon pollution and environmental degredation.

Sound too good to be true?

From jobs → to household bottom line

A Green New Deal is a set of policies that matches the unprecedented scale of changes required and directly addresses the main concerns from government and the public for ensuring that the disruptive social and economic changes are net beneficial for households. In a large scale economic transition, jobs may at times be unpredictable but if planned well the state has a reasonable chance of assuring a safe household bottom line for all Singapaoreans. The Green New Deal does not hold tightly on to previous economic model of the past no more than the candle-stick makers were protected at the invention of the incandesent light-bulb, but instead focuses on household-level impacts, regardless of what happens to certain sunset and carbon polluting industries.

Moving beyond the restricted boundaries of the lassiez-faire philosophy, carbon taxation is only one policy handle that states can use to incorporate the environmental cost into decisions, and other methods can be legislative approaches that criminalize certain kinds of activities — such as polluting carbon beyond 300 ppm and carrots and sticks incentives and rewards. Taking a step forward to embrace a much larger role of the state as a leader of transformative change is to embrace a Keynesian stimulus program — tax-borrow-spend which is considered both realistic and appropriate with a “dramatic transformation of the economy unprecedented in scale” is required.

Key policy objectives for the Green New Deal :

1. Decarbonization in line with science based IPCC targets to reduce by 45% by 2030, zero by 2050 and peak in 2020
2. Economic restructuring towards green growth industries and managed phase-out of sunset industries
3. Retraining and financial relief for low income, manufacturing, at-risk workers during the transition period
4. Incentives and rewards to allow markets to identify solutions that reflect the true cost of carbon pollution USD $40-$80/ton
5. Just transition — those most responsible for carbon burden have highest obligation to pay for the transition
6. Collective co-creation — public outreach and education campaigns, and a seat at the policy making table for engaged members of the public.
7. Multilateralism and financial ties with ASEAN neighbors for greater regional cooperation and development

Decarbonization

First an outline of the structural changes needed in the economy. The decarbonization plan for Singapore should adapt both to current profile of greenhouse gas inventory, and the national circumstances.

Singapore’s greenhouse gas emissions profile

1. 40% Petrochemical industry — refining and olefins (plastics) production
2. 20% other manufacturing and construction
3. 20% air conditioning in buildings
4. 16% transport (burning transportation fuels from refining)
5. 8% non AC from other commercial and retail operations
6. 4% non AC from households, hospitals, schools and government buildings

Here decarbonization focus is adapted from the emissions profile into five broad areas — industry, power generation, urban built environment including transport, consumer choice and offsetting

1. Decarbonize petrochemicals and manufacturing
2. Decarbonize electrical power generation
3. Reform urban built environment from net consumer to net producer
4. Incentives for households, dividend rewards and signals at point-of-sale
5. Sharing the burden across the border through purchased offsets

Decarbonize petrochemicals and manufacturing

The pareto principle for how to break-up and prioritize for problem solving by first starting with the top 80% is a sensible heuristic that guides boardroom decisions throughout businesses and is also appropriate as a starting point for Singapore’s emissions. Together petrochemicals (40%) and other manufacturing (20%) make up 60% of combined primary and secondary emissions, with primary emissions from burning gas for high temperature thermal conversion processes. Total manufacturing represents 34% of Singapore’s GDP and employs an estimated 500,000 workers, with petrochemicals representing a much smaller minority for both GDP and number of workers employed (50,000). Examples of other sub-industries included in the industry category include precision engineering, electronics, biomedical, transport engineering and construction.

GND policy for industry transformation is a three-part strategy to address both the downside risk of sunset industries and the decoupling of emissions from the manufacturing production process.

1. Risk-based monitoring of exposure of businesses to global changes in consumer, technology and political trends in response to climate action
2. Transition map and financial assistance for manufacturing workers into new growth industries
3. Decarbonization of manufacturing production process

An eye for downside risk — risk management approach to manufacturing

First — policy makers must have a clear risk map of those industries with the highest exposure to the disruptive potential of global trends including climate action ambition. A common observation from other OECD economies is the trend away from manufacturing towards services in the later stages of economic development, and Singapore should not be shy away from embracing this shift. While the drive for developing economies to urbanize and uplift their population from poverty through water sanitation, housing and electricity is likely to continue, there are signs that the 20th century model of the high income consumer based lifestyle may be shifting towards a less material intensive towards experience based. These shifts may have implications for companies locked into a business model based on delivering physical non-essential consumer goods. Other trends to watch that may have downside risk for manufacturing is competition by companies with lower labor costs, automation and emergence of the open-source decentralization of manufacturing, which may result in an overall decline of take-home for workers even for the same level of output. These trends suggest the following growth industries that Singapore is in a good position to gain an early competitive advantage

Green growth industries :

1. Carbon capture utilization and storage
2. Solar, PV and Wind
3. Circular manufacturing
4. Dynamic, intelligent electricity grid
5. Net positive building design
6. Sustainable, walkable urban design and transport systems
7. Gen III/IV Nuclear technology
8. Vertical farming
9. Plant based protein
10. Ecological restoration and land based carbon sequestration

Other growth industries

1. Digital — AI, automation, blockchain
2. Distributed, creative, sharing economy
3. Ed-Med human touch — Education and medical services

For now these trends are still out on the horizon and likely to come gradually, in contrast to the rapid pace of change of climate crisis in international politics. In a global political context where climate change is a central part of diplomatic relations, carbon polluting businesses may face increasing barriers to exporting into climate friendly markets that have crossed the political tipping point on climate action. A pragmatic risk-based policy strategy from the MTI and EDB which is agnostic to propping up business-as-usual and sensitive to downside risks could include a monitoring program whereby businesses are required to report on key indicators of climate action resilience. Such indicators could include industry growth forecast projections, share of export markets in climate friendly regions like EU, US and Latin America, financial leverage, operating margins, energy as a % of operating costs, supply chain links to other polluters, emissions intensity per $ of earnings and total carbon and ecological footprint.

Workers first — career transition map and financial assistance to smoothen the transition into the new growth industries

A global trend since the 1970’s is a growing gap of wealth inequality and increasing returns of profit to capital. While real wages have risen in Singapore, they have not kept pace with that of the returns to capital. Recently the government has begun to track its gini coefficient indicating the importance of shifting to the worker’s perspective. To transition away from sunset industries requires both a vision of the new growth industries and a roadmap for the transition. Singapore has already demonstrated a blueprint for transitioning workers in its development of the Industry Transformation Map which considered for anticipated changes in digital and finance. A similar opportunity exists now for decarbonization and climate change. A worker based transition plan must answer questions about how workers will receive the education and skills upgrades that will prepare them for the new industry, and the financial assistance they can expect to help them make the transition without fear of personal loss. The decision process for who gets what with respect to financial assistance is ultimately a political question, here several different ranges are proposed from low to high ambition, with the highest level set at $6,000 per worker that is directly affected. To the question of who should be eligible, this should factor for which industries are most at risk based on the risk monitoring program, and the worker’s personal circumstances — education level, household size, age and transferrable skills. Ulitmately workers are households and care about the long term future for their families. So long as there are bright prospects for employment elsewhere, it should not come as a surprise that they could embrace this change to a new career path in a safer working environment that doesn’t include the need to don PPE and expose to high noise level and toxic gasses from collecting samples.

Decarbonize manufacturing production process

IPCC special report on carbon capture and storage

While the possibility of complete scale back of polluting manufacturing industries should not be off the table, it also is not the only option to achieve the decarbonization results and all options should be considered from a balanced perspective of costs and benefits under the constraint of scientific targets. Decarbonization is based on combined approach of CCUS, renewable source of hydrogen, switch from thermal to electric motive forces and general energy efficiency. Obviously decarbonizing electrical power generation will improve emissions from manufacturing along with the rest of Singapore.

CCUS is a cost in two ways, first there are upfront capital costs and second there is a thermodynamic efficiency loss from the added energy in the process steps of separation, transport and storage. Costs are falling, and now many available options at US$40/ton of net CO2 abated. The largests costs are in the capture step and approximatly 15% of the $40/ton is allocated to capital depreciation. The energy penalty is in the range of +15% which means that a CCUS facility can expect to consume 1.15 units of energy for the same useful work output compared to a non CCUS facility with 1.0 units of input energy. CCUS is not new and has been demonstrated for variety of uses within the petrochemical industry since the 1970’s and has a wide range of technology approaches including amine solvents and steam-methane reforming. While the technologies do have some extra costs, there is significant surplus in the profit margin from the petrochemical industry to absorb these costs. CCUS may impact the most intensive carbon polluters from $280,000 to $260,000 value-add per worker, measurable but manageable. ExxonMobil has been anticipating the need to implement carbon capture like technologies for years by tracking the “Greenhouse gas cost” which it estimated at $40/ton as the realized business consequence of climate action policy. So far it has not taken its own initiative and communicated that it will wait to have these projects coerced onto it by explicit government policies. Whether funded by the polluters or with the aid of public funds from carbon taxation, there is ample surplus wealth available for CCUS infrastructure.

Decarbonize electrical power generation

Singapore’s current electricity mix is dominated by natural gas. Despite the fact that there are a wide range of low carbon electricity technologies, only Solar photovoltaics (Solar PV), CCUS and Nuclear have the potential to be scalable and cost effective options in the near term. Hydroelectric, geothermal have limited scale-up potential and the prospects for wind scale-up are still uncertain. While Laos has promoted their potential for hydroelectric, the upper limit on the available capacity may not be sufficient to meet demand and the expansion has been met by resistance in the region, notably in Thailand — on concerns on the environmental impact. Geothermal is limited to specific locations in the Philippines and Indonesia. Wind has not been identified as viable in the near term due mainly to climate and geography limitations. Given these limitations the first priority for decarbonizing the electricity grid is greater ASEAN regional integration and acceleration in the development of the ASEAN power grid. The following are additional measures that Singapore can execute towards a carbon neutral domestic power grid.

Based on a number of technical reports CCUS could be implemented relatively quickly to existing natural gas power plants at a lower cost compared to manufacturing at a cost less than $20/ton of carbon abated and minimal incremental impact to electricity prices <0.05 / kWh. Carbon capture for power plants, like manufacturing is a pure cost for the state since in the absence of a fully priced carbon tax, there is no viable commercial models for CCUS. On the other hand Nuclear and Solar have an intrinsic financial return without a carbon tax. Nuclear stands out as an attractive opportunity for Singapore due to its relatively small land footprint for a given TWh/yr capacity and its highly reliable 24/7 supply characteristics. Consideration of these viable alternatives is an important step in making significant steps towards decarbonizing the grid. For the moment, the state has only acknowledged commitment to Solar PV.

Solar PV

Of the three — Solar PV is the most attractive from a cost perspective and is a central part of Singapore’s current NDCs. Costs are continuing to fall and the industry receives state support in several areas including SERIS solar research institute. Estimated costs are around $4/(kWh/yr). Officially the government has identified 50 km2 of land area from the built environment available for solar deployment. To reach the scale to have a noticeable impact on the electricity grid, Solar PV needs help. First — it is intermittent with the availability of incident solar radiation which means that it cannot be relied on as a stand-alone source without significant battery storage infrastructure. Given the strong public externalities nature of the distribution of the benefits — this infrastructure would likely need some amount of public incentives investment to ensure that it is adopted at scale. Second — 50km is not enough, At 150 kWh/yr/m2 of electricity yield 50 km2 could only expect to deliver 8 TWh/yr far shy of the 45 TWh/yr of Singapore’s total electricity demand. To fully meet Singapore’s electricity demand would require up to 300 km2 of solar capacity.

To expand the range of solar deployment could come from three policy strategies, all of which the state appears to be actively investigating.

1. Lease or purchase agreement with trade partners in the region which have more abundant land available— Malaysia, Australia.
2. Expanding the available rooftop area in the built environment ( up to 134 km2) through urban redevelopment
3. Utilizing some portion of the other 700 km2 of Singapore’s territory covered by water using floating solar

Urban infrastructure reforms from net consumer to net producer

One prominent features distinguishing humans from other primates together with language is the development of settlements. The permanent fingerprint of cities on earth is unequivocally evident from their pattern of lights from buildings and highways visible from space. Singapore is one of the most advanced examples of modern urban design. The complete urban design includes both buildings and transport as the two systems are highly interdependent on one another. Modern cities harbor a safe environment that provides the essentials of a thriving economy — basic sustenance water, food, nutrition, shelter and the opportunity for intimate high frequency interaction and exchange of information and materials. The dark side of cities however is their unsustainable environmental design and role in climate change due to their damaging effects as a net consumer of raw materials, waste generator and an unchecked carbon polluter.

Energy consumption from buildings and transport accounts for 32% of Singapore’s emissions, or approximately 16 MT CO2eq/year (2.7 tCO2eq/year/capita). Of the 16 MT/yr 75% is from buildings and 25% from transport. Energy for cooling is reported to be up to 80% of the energy demand for buildings. More significant is the large area footprint of buildings in the territory represents a lost opportunity of production of essential resources such as food, water and renewable energy and the opportunity to transform urban transportation modality from personal vehicles to public transport and walking. Buildings are likely to fill an ever increasing role in the new economy. To stay consistent with the economic shift from industry to service buildings it is reasonable to expect growth in m2/capita of office space to accomodate the additional workers out of the workshop into the office.

The standard metric assessing a building’s energy consumption is energy usage intensity (EUI) — measured in units of kWh/m2/yr. Zero Energy Building (ZEB) is a set of benchmarks for energy performance similar to the Passive House Standard that aims for buildings to be energy neutral or positive. The latest estimate overall average EUI in Singapore is reported at 260 kWh/m2/yr compared to ZEB range of 75–100 kWh/m2/yr there is room for improvement. Based on survey reports from actual buildings by Singapore’s Building and Construction Authority, and comparing to ZEB targets there is potential to reduce EUI by 37% by closing the gap. Of the 37% energy reduction, 16% is contributed by residential, 8% from office and 7% from retail.

Singapore’s first Zero Energy Building — NUS ED4

Performance metrics for the sustainable urban design

A well designed building and urban planning in a tropical environment such as Singapore has the potential to provide for 100% of water, 100% of dietary vegetables, meet the majority of daily transportation needs with walking and renewables powered public transportation at 1,200 kWh/year/capita and meet the residual buildings needs based on benchmarks of 30 kWh/m2/year for residential and 200 kWh/m2/year for all other buildings, and current gross floor area ratio of 20 m2/person for residential and 5 m2/person for all others.

Concept illustration of the resource positive urban design

The following are a set of design principles that are likely to achieve these pereformance targets

General

• Urban canopy — maximize exposure on rooftop and ground-floor to maximize the capture of abundant natural resources of sun and rain and reduce energy demand from self-shading
• Adapt to existing environment to minimize embodied emissions from new development
• Distributive infrastructure, financing that incentivise localized supply chain networks in the city of food, water and energy
• Inter-parcel connectivity to facilitate distributed economy and encourage walkability

Food, Water

• Utilize high-yield farming technologies — hydroponics for optimal yield, resource efficiency
• Deploy a variety of urban farming technologies at different parts of the building that are best suited to the local light, temperature and water conditions — hydroponics in the rooftop and inter-floors, fruit orchard on ground floors, mushrooms, protein indoor and below-ground spaces.
• Integration of food production in close proximity to residential and cooking facilities
• Localized circular organic waste capture, sorting and upgrading to soil nutrients
• Localized rainwater capture and greywater recycling, water treatment
• Automated transport facilities for circular movements of food, water, waste and electricity
• New dug-out retention ponds to adapt to rising sea levels, capture rainwater and provide protein from aquaculture

Renewable energy

• Maximize capture potential on extended rooftop canopy
• Building integrated solar PV for facades
• electricity storage, metering and smart balancing
• biogas digesters to supply fuel for cooking by F&B tenants

Building energy demand

• Natural ventilation enhancement — high surface area inter-floor fins, outdoor corridors
• Rooftop canopy self-shading
• High density indoor spaces — office, residential and outdoor public corridors and spaces
• Scientific comfort standards 25–27 C
• Low U-value window glazing and envelope thickness, materials
• Partial shaded sunlight as primary daytime lighting supply
• Centralized cooling systems with water pipes for best trade-off of economies of scale and localized comfort
• Building, neighborhood waste-heat scavenging from light industrial activity
• High efficiency LED lighting

Google maps illustration of the interdependancy of transportation and urban design using St Louis and Barcelona as examples

Transportation

• Seamless inter-building connected network of protected pathways
• Poly-hub urban pattern maximize shorter commute paths
• Public transport centric hubs — parcel and plot ratio spatial distributions
• Corridor design priority for pedestrians, bicycles, public busses, automated delivery
• Access restrictions for private vehicles parcel parcel-corridor typology, parking spaces
• Abundant access to electric vehicle charging stations
• Full electrification of public transport

Public investments to achieve these shifts are lumped into two broad areas — urban infrastructure retrofit projects, and electrification of vehicle fleets, both private and public busses. Public incentives for infrastructure could be priced using the currency of net carbon abated. Expected costs for conversion here are estimated in the range of $2000/vehicle.

Incentives for households, dividend rewards and signals at point-of-sale

Given substantial improvements in manufacturing, power generation and urban systems — buildings, transport — there is still an open question for the role of households. In particular the question of consumption behavior and financial impacts in the wake of the transformation.

Households make consumption decision that result in imported retail goods, dietary choices high in meat and holiday travel on planes that leave an airborn trail of carbon. Many of these decisions do not shows up in Singapore’s greenhouse gas inventory but instead represent the much larger and less visible imported emissions. The assumption of the GND is that households are likely to be sensitive to perceptions of financial impacts from changes to their employment prospects and paycheck, and also to inflation of costs in essential services such as electricity, but may not be as politically sensitive to financial disincentives for non-essentials and luxury goods.

Climate justice — Carbon dividends for low and middle income households

This GND anticipates the temporary ups and down in employment that may come as the economy shifts away from the old 20th century consumption economy industries of consumer retail and energy intensive manufacturing towards the 21st century green, creative, digital and experience based products and services. Throughout these ebbs and flows it is important for to provide the assurance of a floor on household bottom line through a carbon dividend program. Carbon tax and dividend is the most popular form of carbon tax. Redistribution of the proceeds from public taxes to low and middle income households reinforces the social contract between government and the people and sends a strong message of climate justice. A carbon dividend program gives the GND the best chance for broad political support by communicating that the burden of paying for the cost of historical carbon should go first to those who have historically benefited and protects those who have contributed the least. Here the proposed level of dividend relief is set at 750/month for low income households and 200/month for middle income workers and can be implemented on a gradual scale so as not to create perverse dis-incentives to earning higher wages from discrete jumps.

Influence behavior with nudges aimed at high income households

The GND embraces climate justice — the reality that higher income households tend to disproportionately contribute to carbon pollution in their lifestyle and consumption choices compared to low income households, and they also are better resourced to adapt to climate change. For this reason GND considers policy incentives that aim specifically at higher income households through income tax and consumption tax on luxury non-essentials — meat, luxury goods, holiday air travel. To meet the needs for decarbonization spending and create the necessary behavior shifts the consumption tax ratees are anticipated to start at 2% and ramp to as high as 6% or 8% over a 30 year transition period. These policies are complimentary to urban design, since they are likely to accelerate the shift away from high EUI retail in the tenant mix in buildings. Furthermore building owners can further accelerate this shift using the idea of “cookie jar” by physically shifting such high EUI non-essential retail tenants away from the high traffic areas towards higher floors and out at the peripheral edges of the city.

Sharing the burden across the border through purchased offsets

After making strides in manufacturing, power generation, buildings, transport and consumer behavior, there may still be a residual unclosed emissions gap, particularly in 2050 when approaching zero. To close the gap by purchasing offsets with a partnering land-rich hinterland may be a reasonable trade-off. In this proposal an estimated $S 2.6 bil is anticipated to cover the gaps in the 30 year transition period. Land based ecological carbon sequestration methods can be achieved at much lower price of carbon $20/ton compared to industrial approaches like direct air capture (DAC) which range anywhere from $100-$600/ton. Even if Singapore does fully meet the scientific targets without offsets, these purchases may be a prudent diplomatic negotiation tool under scenario of increasing food security and climate migration stressors on international relations. Financial flows from Singapore offshore to hinterland partners in ASEAN will be critical in building the regional cooperation by meeting their needs for development, agricultural reforms and adaptation since these areas are likely to become the front lines of the climate disruption.

Singapore’s leadership in sustainable finance doesn’t stop with the gas, but also the brakes. Divestment from polluting industries starting with coal and moving to fracking and oil and gas exploration is emerging as an indicator of financial leadership in the new economy and may be critical for Singapore to establish itself to prominence at the global stage.

The Green New Deal budget

A survey of Singaporeans revealed public support for both higher taxes and reserves to combat climate change but to date the only mention of Singapore’s climate change budget was S$100 billion for adapting to sea level rise and was met with lackluster reception by local environmental advocates who were expecting stronger emphasis on climate change mitigation. The public is instead calling for a Green New Deal.

Putting it all together, the budget for the GND is estimated at S$81 billion spread out over 30 years or 0.4% of GDP —within the expected range from the Stern Review and modest relative to its ambition. The story of the GND buget is the combination of two flows of finance — climate justice corrections from past years of under-pricing externalities cost of carbon pollution and sustainable investment in the new green economy.

The climate justice flows estimated at $58 bil drawn funds from those who are most responsible — polluters, lavish spenders — and redistributed to invest in the most direct costs of the transition — CCUS and worker transition relief + low income household dividends. The sustainable investments of S$23 bil draw from publicly funded CPF green bond scheme and reserves and invested towards overseas development in the ASEAN region, incentives for built environment infrastructure retrofits including transport reforms, and R&D program to incubate and accelerate the new green economy industries.

The Green New Deal Budget

Mosaic of possible GND budgets — variations from the base

This is the base scenario, which includes a range of assumptions and forecasts about employment, GDP growth during the 30 year period from 2020 to 2050. As highlighted earlier in the report the most significant policy choice is the level of ambition. The full budget represents the scientific targets of 1.5C and a business-as-usual policy of 3.4C implies a much smaller budget of $11 billion.

Side-by-side comparison of scientific vs BAU ambition

Among the external uncertainties the most prominent uncertainty is the global pressure on contraction of the fossil fuel industry. In the base scenario the natural decline of the industry is assumed to be -30% by 2050. While its true that there will still be a residual role for the industry globally, there is reason to be skeptical that in a crowded set of OPEC nations including the US and a flood of new renewable energy coming online that Singapore’s petrochemical industry will win out as the lowest cost operator in the race to the bottom. A ligher external pressure on Singapore’s industry could increase the costs of decarbonization. The impact of a low -30% and high +25% scenario is estimated to have an an incremental impact of + S$ 6 billion.

The third variation is the economic school of thought. If the most Keynesian elements are removed and only the carbon tax with balanced budget is assumed, then the budget shrinks to S $30 billion. In this Lassiez-faire budget the expenditures are directed to the bare minimum of CCUS for manufacturing and built environment retrofits and a modest relief package for affected workers. With lower funding and fewer economic incentives less ambitious assumptions are made and there are greater risks of slipping on emissions targets as a trade-off for less pressure on polluting businesses. As a consequence the shift in energy consumption in commercial, industrial and households would be slower which leaves a larger residual gap to close in carbon offset financing.

A compromise middle ground between the two of S$47 billion could include the addition of a modest consumption tax with a balanced budget to provide some consumer nudge and boost the budget for R&D and worker transition assistance.

In summary for Singapore science based ambition for climate change mitigation is not only necessary on ethical grounds for the youth and global South, it is also a prudent choice to gain an early advantage in the new green economy considering the shifting global trends. A Green New Deal program for the economic transition is a realistic policy option at a modest budget of <0.4% of GDP well within the economists estimate for paying the true cost of carbon.