Lithium ion storage project financing options in Singapore 2026

Why do energy storage projects need project financing?

The rapid growth in the energy storage market is similarly driving demand for project financing. The general principles of project finance that apply to the financing of solar and wind projects also apply to energy storage projects.

How much SG$49 million does the government spend on Energy Research?

Government sets aside SG$49 million ($36.05 million) to support R&D efforts in low-carbon energy technologies such as hydrogen, and kicks off an initiative to pilot a lithium-ion battery energy storage system on a "floating" lab.

Why is project finance difficult for energy storage?

It has traditionally been difficult to secure project finance for energy storage for two key reasons. Firstly, the nascent nature of energy storage technology means that fixed income lenders and senior debt providers are naturally risk averse.

Will a tax credit be available for energy storage projects?

However, with the passage of the Inflation Reduction Act of 2022, tax credits are now available for standalone energy storage systems, and thus lenders may be willing to provide bridge capital that is underwritten based on the receipt of proceeds from an anticipated tax equity investment, similar to renewable energy projects.

Could a sodium-ion battery be a cheaper alternative to lithium ion batteries?

The awarded projects were selected for their scalability and relevance to Singapore ’s energy needs. Posh Electric will conduct a trial using sodium-ion batteries (SIBs), which could offer a cheaper alternative to lithium-ion batteries (LIBs) due to sodium's greater natural abundance.

Could a lithium-ion battery power Keppel O&M's floating living lab?

Awarded to a consortium led by Envision Digital International, the research grant would see the deployment of a 7.5 MW/7.5MWh lithium-ion battery ESS on Keppel O&M's floating living lab. This would have sufficient capacity to power more than 600 four-room HDB apartments a day, the partners said in a joint statement.