Singapore Government Offtake

As part of the IA approval process, a project developer (referred to in the IA as “Project Applicant” or Project Participant”, depending on the stage of the process) must submit a binding offer to the Singapore Government for the Singapore Government to purchase at least 30% of the ITMOs that are authorised under Singapore’s IAs. Details on the terms of sale to the Government will be notified to all applicants who have submitted applications at Stage A or B of the process.

Singapore Carbon Tax-Liable Companies

Where the project developer is an entity that is liable to pay carbon tax under the Carbon Pricing Act 2018, the project developer may elect to:

(a) submit a binding offer to the Singapore Government for the Singapore Government to purchase ITMOs authorised under the IAs, no later than by Stage C of the process or;
(b) surrender ITMOs authorised under the IAs towards its carbon tax liability within 24 months of the ITMOs being authorised or;
(c) adopt both (a) and (b),

provided that a total of at least 30% of ITMOs authorised under the IAs are either offered to the Singapore Government for purchase or surrendered to the Singapore Government to offset its carbon tax liability.

Whether the Singapore Government will accept the offer and purchase the ITMOs is at the Singapore Government’s discretion. The Singapore Government will only consider purchasing ITMOs that secure Article 6 authorisation under Singapore’s IAs, and that meet all of Singapore’s prevailing environmental integrity (EI) requirements at the point of offtake.

Calculation of the 30% Threshold

The 30% threshold is calculated based on the total volume of ITMOs authorised (including SOP and OMGE units) with corresponding adjustments. To illustrate:

1. The project developer submits a request for authorisation of 100,000 ITMOs generated by a mitigation activity under Singapore’s IA. At the same time, the project developer also submits its offer to sell the ITMOs to the Singapore Government, in accordance with the Singapore Government’s requirements.

2. The obligation to offer the ITMOs to the Singapore Government for purchase will apply to at least 30% of the ITMOs that are authorised under the IA. To illustrate, based on the abovementioned example:

a. 5,000 ITMOs (i.e. 5%) will be contributed towards SOP.

b. 2,000 ITMOs (i.e. 2%) will be cancelled towards OMGE.

c. At least 30,000 ITMOs (i.e. 30%) must be offered to the Singapore Government.

d. Project developer can sell/trade the remaining 63,000 ITMOs (i.e. 63%), subject to all other prevailing requirements of both Singapore and the host country.