TRW & Co · Real Estate, Projects & Energy
Renewable Energy Contracts in Singapore
Renewable energy contracts in Singapore let companies buy clean power through solar leases, on-site and virtual PPAs, green retail deals, renewable energy certificates and long-term offtakes of imported electricity. Each structure carries different licensing, pricing and evidence risks. This guide explains how to choose, negotiate and manage them so that savings and renewable claims hold up.
Key pointThe contract's evidence clauses matter as much as its price: unless it clearly transfers renewable energy certificates through a named registry and matches your reporting framework, the buyer may pay for clean power it cannot credibly claim.
At a glance
Solar licence threshold
EMA guidance indicates residential solar below 1 MWac needs no licence, while systems exceeding 1 MWac at the grid connection point need a generation licence.
SS 673 for RECs
Singapore's voluntary code of practice for renewable energy certificates, launched in October 2021, covers registration, verification, issuance, transfer and retirement of certificates.
Imports since 2022
Singapore began importing up to 100 MW of hydropower from Lao PDR through Thailand and Malaysia in June 2022, its first renewable electricity import.
13 import projects approved
By August 2026 EMA had granted Conditional Approvals and Conditional Licences to 13 import projects from Australia, Cambodia, Indonesia, Malaysia and Vietnam.
RECs are not offsets
Renewable energy certificates support claims about electricity sources but do not reduce direct emissions or carbon tax under the Carbon Pricing Act 2018.
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What renewable energy contracts in Singapore cover
Renewable energy contracts in Singapore are the agreements through which companies buy, finance and prove the use of clean electricity. The main forms are on-site solar leases and power purchase agreements (PPAs), green retail electricity contracts, virtual or financial PPAs, purchases of renewable energy certificates (RECs), and long-term offtake contracts for low-carbon electricity imported from the region.
This page is about the contracts a buyer or seller signs. The licensing, construction and financing of the generating asset itself is covered on our energy projects page. The distinction matters because the commercial risks in a 20-year offtake contract, such as curtailment, termination payments, roof access and certificate ownership, are often different from the risks in building the plant.
Demand is driven by corporate net-zero targets, investor and customer expectations, and mandatory climate reporting for listed and large companies. Singapore's limited land means that most companies cannot cover their consumption with rooftop solar alone. Contracts that combine on-site generation, RECs and, increasingly, imported power are therefore common, and each piece needs its own legal treatment.
The legal and regulatory framework
The Electricity Act 2001 is the starting point. It makes generating, retailing and importing electricity licensable activities, with the Energy Market Authority (EMA) as regulator. A contract that looks like a simple equipment lease may in substance be a sale of electricity, and if the seller is not licensed or exempt for that activity, the contract structure is at risk.
For solar, EMA's guidance indicates that residential installations below 1 MWac need no licence, while systems exceeding 1 MWac, measured by aggregate inverter capacity at the grid connection point, need a generation licence. Non-residential installations with load demand above 45 kVA need an electrical installation licence. Grid-connected users buying electricity from the market do so through licensed retailers in the Open Electricity Market, so a PPA that delivers power across the grid normally involves a retailer.
Carbon pricing sets the background economics. The Carbon Pricing Act 2018, administered by the National Environment Agency, imposes a carbon tax on direct emissions from large facilities. RECs are not carbon credits. They support claims about the source of electricity used, but they do not reduce a facility's direct emissions or carbon tax liability. Our carbon markets practice advises on the separate rules for carbon credits.
The REC standard for renewable energy contracts in Singapore
RECs in Singapore are governed by contract and by a voluntary national standard, SS 673, the code of practice for renewable energy certificates launched in October 2021 by the Singapore Standards Council and Enterprise Singapore with EMA and NEA. It covers the lifecycle of RECs from production and tracking to use, requires installations to be registered and verified, and requires registries to ensure an installation is not active in another registry at the same time. It recommends that consumers' renewable claims state the origin, energy type, procurement mode and verification method.
Contract types compared
Buyers rarely use only one structure. The table compares the most common options.
| Structure | How it works | Main legal issues | Best suited to |
|---|---|---|---|
| Solar lease | Provider installs and owns panels on the customer's roof; customer pays a fixed fee or per-kWh charge | Roof rights, licensing of the seller, export payments, relocation and buy-out | Owners of large roofs with long tenure |
| On-site solar PPA | Customer buys output from a provider-owned system at an agreed tariff | Minimum offtake, deemed generation, REC ownership, change in law | Industrial sites and campuses |
| Green retail contract | Licensed retailer supplies grid power bundled with RECs | Quality of RECs, retailer credit risk, early termination fees | Contestable consumers wanting simple procurement |
| Virtual or financial PPA | Contract for difference against a reference price, with RECs transferred | Derivative and accounting treatment, basis risk, credit support | Large buyers with sophisticated treasury teams |
| Unbundled REC purchase | Buyer purchases certificates separately from electricity | Registry, vintage, market boundary, double counting | Filling gaps in renewable coverage |
| Import offtake | Long-term purchase of low-carbon power imported by a licensed importer | Project milestones, cross-border risk, pricing, force majeure | Large long-term buyers and retailers |
Key terms in PPAs and solar leases
Whatever the structure, the same clauses decide whether a contract delivers value over 15 to 25 years.
Price and indexation
Fixed, escalating, discount-to-tariff or market-linked prices each shift risk differently. A discount to a regulated or market reference price looks safe but moves with that reference, so savings are not guaranteed.
Volume and curtailment
Define who bears the cost when output cannot be delivered, for example because of grid constraints or the host's maintenance. Deemed generation clauses are fair but need a clear calculation.
Site rights and relocation
For rooftop systems, the contract needs a licence or lease of the roof, access rights, and relocation or buy-out terms if the building is redeveloped or sold.
Certificates and claims
State who owns RECs and other environmental attributes, how they are issued, transferred and retired, and what evidence the buyer receives for its reporting.
Change in law
Allocate the cost of new charges, market rule changes and tax changes. Long contracts without this clause leave risk with whoever drafted less carefully.
Termination and credit
Termination payments should reflect the provider's unrecovered investment and the buyer's lost value. Credit support, such as parent guarantees or bank guarantees, protects both sides.
Lenders to the provider will want direct agreements with the host or buyer, with step-in rights and notice of default. Hosts should accept these, but limit them to what financing genuinely needs. Our commercial leasing team checks that a roof licence fits within the host's own lease, since many hosts are tenants themselves.
Import contracts and regional power
Singapore aims to import about 6 GW of low-carbon electricity by 2035, and EMA runs a staged process of Conditional Approvals and Conditional Licences, described on its regional power grids page. Singapore began importing renewable electricity in June 2022, with up to 100 MW of hydropower from Lao PDR delivered through Thailand and Malaysia under the Lao PDR-Thailand-Malaysia-Singapore Power Integration Project.
In August 2026, EMA granted Conditional Approvals for 900 MW of imports from Peninsular Malaysia, from solar and battery storage in Johor, and reported that it had granted Conditional Approvals and Conditional Licences to 13 import projects from Australia, Cambodia, Indonesia, Malaysia and Vietnam. Before financial close, such projects must still obtain approvals in each relevant jurisdiction, sign power purchase agreements and secure financing.
For buyers, this creates a new class of renewable energy contracts in Singapore: long-term offtake agreements tied to projects that do not yet exist. Key issues are conditions precedent linked to EMA and foreign approvals, long-stop dates, pricing and indexation, cross-border force majeure and change in law, and how imported electricity and its certificates are tracked into Singapore. Contracts should give the buyer a clear exit if the project misses key milestones.
The contract chain behind an import project is long. It typically includes land and generation agreements in the host country, a PPA between the generator and the Singapore importer, transmission or cable arrangements, the importer's licence conditions from EMA, and onward sales to retailers or large consumers in Singapore. A buyer at the end of that chain should understand which events upstream can delay or interrupt supply, and make sure its own contract passes through relief and remedies in a balanced way rather than absorbing every upstream risk.
Pricing also needs care. Imported power may be priced by reference to market prices in Singapore, to fixed tariffs with indexation, or to a combination. Currency risk can arise where generation costs are incurred in another currency. Agree the reference price, indexation and any caps or floors precisely, and test the formula against realistic scenarios before signing.
A renewable claim is only as strong as the paper trail behind it. Contracts should deliver certificates and evidence, not just electrons.
Process: from target to signed contract
- Set the objective. Decide whether the goal is cost savings, a renewable electricity claim, additionality, or all three. Each points to a different structure.
- Map consumption and sites. Gather load profiles, meter data, roof areas, lease terms and expected occupancy for the contract period.
- Choose the structure. Compare on-site solar, green retail, virtual PPA, unbundled RECs and import offtake, including accounting and tax treatment.
- Run a competitive process. Issue a request for proposals with a term sheet that fixes key legal positions, so bids are comparable.
- Diligence the counterparty. Check licences, track record, financial strength, the provider's financing and the REC registry it uses.
- Negotiate and sign. Agree price, volume, certificates, change in law, termination, credit support and lender direct agreements.
- Operate and report. Monitor generation, receive and retire certificates, and keep evidence to support sustainability disclosures.
Documents and evidence to assemble
Good preparation shortens negotiation and makes bids comparable. Before going to market, a buyer should collect twelve to twenty-four months of interval meter data for each site, current retail electricity contracts and their expiry dates, leases or title documents for each roof or site, structural information about roofs, insurance requirements, and the sustainability targets and reporting frameworks the company has committed to.
From the provider, request its EMA licence or the basis on which it is exempt, its standard contract, evidence of the REC registry it uses and registration of the installation, details of panels, inverters and batteries with manufacturers' warranties, operation and maintenance arrangements, and its financing structure, including any lender direct agreement it will require. For larger deals, a parent guarantee or bank guarantee and recent audited accounts should be part of the package.
During operation, keep monthly generation and consumption reports, certificate issuance and retirement records, invoices showing the calculation of each charge, records of curtailment or downtime and correspondence on any disputes. These records support both the buyer's sustainability disclosures and any later claim. Auditors and assurance providers increasingly ask to see them, and gaps are much harder to fill after the event.
Finally, keep a short internal memo explaining why the chosen structure supports the company's public statements. When marketing or investor relations teams later describe the company's renewable sourcing, they can check their wording against it. That discipline is one of the simplest ways to keep renewable energy contracts in Singapore aligned with what the company tells the market.
Risks and common mistakes
Structuring a "lease" that is really an unlicensed sale of electricity
Third-party-owned solar can be offered as an equipment lease or as a sale of electricity. If the provider charges per kWh delivered, regulators may treat it as selling electricity, which raises licensing questions under the Electricity Act. The answer depends on the configuration, the size of the system and how payments are calculated. Confirm the regulatory position with EMA's guidance before rolling out a standard contract across many sites, because restructuring a live portfolio is expensive and disruptive for customers.
Unclear ownership of RECs
If a PPA does not say who owns the certificates, both the provider and the buyer may claim the same renewable attributes, or the provider may sell them separately. That undermines the buyer's claims and can expose it to greenwashing allegations. State that all environmental attributes transfer to the buyer, name the registry, require timely issuance and transfer, and give the buyer a remedy if certificates are not delivered. Align the clause with the reporting framework the buyer uses, so that evidence matches disclosure.
Using certificates that do not support the claim
SS 673 recommends that buyers use certificates from the same market boundary where they consume electricity, and reporting frameworks and labels may require Singapore-sourced certificates for Singapore claims. Buying cheaper foreign certificates may not support the statement the company wants to make. Check what each relevant framework accepts, including RE100, CDP and any customer requirements, before signing. Our sustainability reporting team aligns contract terms with disclosure obligations.
Contract terms that outlast the building or the lease
A 20-year rooftop contract may outlive the host's lease, ownership or business plan. If the building is sold, redeveloped or vacated, the contract must say what happens: assignment to the new owner, relocation of the system, or buy-out at a pre-agreed price. Without these terms, the host may face a large termination payment or be unable to sell the building with clean title. Check the host's lease to make sure the landlord has consented to the installation.
Treating a virtual PPA as a simple supply contract
A financially settled PPA is a contract for difference against a market price, so the buyer is exposed to price movements and to differences between the reference price and its own electricity costs. It may have accounting consequences, including possible derivative treatment, and the tax and regulatory analysis should be done before signing. Treasury, finance and legal teams need to agree the risk appetite, credit support and termination calculation. Do not let procurement sign it on standard supply terms.
Write the evidence clause first. Decide what the company will say in its sustainability report, then require the contract to deliver the certificates, registry records and data that support exactly that statement.
The cross-border angle
Many renewable energy contracts in Singapore have a foreign element. Import offtakes depend on generation, land and export approvals in Malaysia, Indonesia, Vietnam, Cambodia or Australia, and on cable routes through other states' waters. Regional companies often sign master PPAs or REC framework agreements governed by English or Singapore law that cover several countries, each with different certificate systems and market rules.
TRW & Co's network adds practical depth. Bangladeshi industrial groups supplying global brands face growing pressure to show renewable sourcing, and some manage regional procurement from Singapore. UK and Swiss parent companies bring their own reporting standards and expectations on certificate quality. Gulf investors, including those based in the UAE, are active in regional renewable assets and often prefer Singapore-seated arbitration. Chinese manufacturers supply most solar panels and batteries, so warranty and supply terms flow into the PPA. Our international arbitration team advises on dispute clauses that work across these chains. Where Singapore court or tribunal representation is required, we work alongside Singapore-qualified counsel.
How TRW & Co helps with renewable energy contracts in Singapore
Strategy and structure
We help buyers choose between on-site solar, retail contracts, virtual PPAs, RECs and imports, mapping legal, regulatory and reporting consequences.
Drafting and negotiation
We draft and negotiate PPAs, solar leases, roof licences, REC purchase agreements and lender direct agreements.
Claims and disclosure
We align certificate delivery and evidence with sustainability reporting and advise on avoiding misleading environmental claims.
Disputes and restructuring
We advise on curtailment, termination and certificate disputes, and on renegotiating contracts when sites or business plans change.
Related guidance is in our posts on power purchase agreements and sustainability claims, and on our green finance page. Explore our practices or contact us to discuss a contract.
Checklist for decision-makers
- Have we defined what we want to claim and which reporting frameworks we must satisfy?
- Is the seller licensed or exempt for the activity the contract describes?
- Does the contract transfer all environmental attributes, name the registry and give us remedies for non-delivery?
- Are price, curtailment and change-in-law risks allocated clearly?
- Does the term fit our lease, ownership and business plans, with relocation or buy-out terms?
- For virtual PPAs, have finance and treasury approved the risk, accounting and credit terms?
- For import offtakes, are there milestones, long-stop dates and exit rights?
- Do we have a process to receive, retire and record certificates each year?
Buyers who can answer yes to each point are well placed to sign renewable energy contracts in Singapore that deliver credible claims and stable value.
Frequently asked questions
01What is the difference between a solar lease and a solar PPA?
In a solar lease, the customer pays for the use of equipment installed on its premises, usually a fixed periodic fee, and benefits from the electricity generated. In a PPA, the customer pays for electricity actually delivered, usually per kWh, while the provider owns and operates the system. The PPA shifts performance risk to the provider, but because it is closer to a sale of electricity, the licensing position must be checked against EMA's rules for the specific configuration.
02Do RECs let us say we use 100% renewable electricity?
They can support that claim if the certificates are credible, cover your full consumption for the period, are retired on your behalf and meet the rules of the framework you report under. SS 673 recommends using certificates from the same market boundary, and some frameworks require Singapore certificates for Singapore claims. Describe the claim accurately, for example by stating that it is based on certificates, to avoid misleading statements.
03Can a virtual PPA work in Singapore?
Yes, as a financial contract. The buyer and generator settle the difference between a fixed strike price and a reference market price, and certificates are transferred to the buyer. It does not deliver physical electricity, so the buyer keeps its normal retail contract. Because the buyer is exposed to market price movements, treasury, accounting, tax and regulatory analysis is needed before signing.
04What happens to a rooftop solar contract if we sell the building?
That depends entirely on the contract. Good contracts give options such as assigning the agreement to the buyer of the building, relocating the system, or buying it out at a formula price. Without such terms, the seller may face a large termination payment or a buyer who refuses to take on the contract. Review the clause before marketing the property, and disclose the contract in due diligence.
05Can our company sign up now for imported renewable electricity?
Import projects with EMA Conditional Approvals or Licences are still developing toward financial close, and must obtain foreign approvals, sign PPAs and secure finance first. Large buyers and retailers may be offered long-term offtake contracts tied to these projects. Those contracts should include conditions precedent, milestones, long-stop dates and exit rights, because delays in cross-border projects are common.
06Who should own the RECs in a rooftop solar PPA?
Usually the buyer, if its goal is to claim renewable electricity use, and the PPA price should reflect that. Some providers keep the certificates and sell them separately, which lowers the tariff but means the buyer cannot claim the solar output as renewable. Either can be legitimate, but the contract must say which, and the buyer's public statements must match.
07Does a green retail electricity plan need special legal review?
Standard retail contracts are usually simpler, but check the source and type of certificates bundled with the plan, whether they are retired for you, the evidence you receive, the retailer's financial standing and the early termination charges. If the plan is a key part of your climate claims, the contract should give you documents that support those claims.
Sources and official materials
- Electricity Act 2001 — Licensing of generation, retail and import
- EMA: Do I need a licence to install a solar PV system — Solar licence thresholds
- EMA: SS 673 launch for renewable energy certificates — REC code of practice, October 2021
- EMA: Regional power grids — Import targets and approval process
- EMA: Conditional Approval for 900 MW from Peninsular Malaysia (August 2026) — Johor solar and storage imports; 13 projects approved
- Green-e: Singapore Standard 673 overview — How SS 673 interacts with buyer claims
- NEA: Carbon tax — Carbon Pricing Act rates and coverage
General information only, current as at 20 October 2026. It is not legal advice and does not create a lawyer–client relationship. Singapore law and regulatory practice change; check current official sources and take advice on the facts of your matter.