Jakarta. The green economy took the center stage during President Prabowo Subianto’s first-ever state visit to Singapore on Monday as the neighboring nations inked landmark deals on solar power trade and carbon storage.

During his meeting with Singaporean Prime Minister Lawrence Wong, the two leaders unveiled three bilateral memoranda of understanding (MoUs) that day, one specifically meant to enable sunny Indonesia to supply Singapore with clean electricity, primarily sourced from solar power. The remaining documents revolve around sustainable industrial zones as well as carbon capture and storage (CCS). 

“One promising area is in the green economy. We know that climate change will have an outsized impact on small and archipelagic states like ours. But we can turn our vulnerabilities into opportunities,” Wong told reporters shortly after their bilateral talks.

Speaking to the press, Prabowo said that bilateral economic ties had been going “from strength to strength.” The former army general said he hopes Indonesian sovereign wealth fund Danantara and its Singaporean counterpart Temasek to work together on renewable energy and sustainable industrial zones.

According to the Singaporean Industry Ministry, the freshly inked MoU aims to facilitate the necessary policies, regulatory frameworks, and business arrangements for cross-border electricity trade within 12 months of the document’s signing.

Indonesia aims to export 3.4 gigawatts of low-carbon power to Singapore by 2035. 

Just a few weeks ago, Singapore's Energy Market Authority (EMA) granted a conditional license for Singa Renewables -- a joint venture between TotalEnergies and Royal Golden Eagle -- to supply 1 gigawatt of low-carbon power. A conditional license proves the projects are technically and commercially viable, placing them in an advanced developmental stage. This document puts the project a step closer to construction and commercial operations. 

Last year, the EMA also rolled out its conditional licenses for five Indonesia-based projects, totaling 2 gigawatts of clean power. They were Pacific Medco Solar Energy (0.6 gigawatts); Adaro Solar International (0.4 gigawatts); EDP Renewables (0.4 gigawatts); Vanda RE (0.3 gigawatts); Keppel Energy (0.3 gigawatts). Shell Eastern Trading, which has partnered with Vena Energy, is still pursuing the conditional nod needed for their 0.4 gigawatt power trade deal.

A CCS facility prevents carbon emissions from entering the atmosphere by storing them underground. Under the new MoU, both sides will set up a joint task force for a legally binding government-to-government agreement. 

The third MoU that the ASEAN nations secured that day zeroed in on the sustainable industrial zones in Riau’s Bintan, Batam, and Karimun. This deal will likely boost Singapore’s investment in the country after the island nation continues to remain Indonesia’s top foreign investor for over a decade. In 2024 alone, Singapore made up a third of the foreign direct investment that flowed into Indonesia that year. Official statistics showed Singapore had invested $20.1 billion in Indonesia throughout January-December 2024.