Annual Report | SP Group
Chairman's Message
As a provider of critical services that contribute to economic and social progress, SP Group (SP) is committed to enabling purposeful growth for our customers, community and country.
Guiding our priorities is SP’s Strategy 2030, launched three years ago, as we advance in our roadmap for fulfilling our core responsibilities as Singapore’s power grid operator and undertaking new areas of growth in sustainability.
In managing the nation’s electricity and gas networks, we have maintained an unwavering focus on ensuring reliable and efficient energy supply – a hallmark of Singapore’s world-class grid performance. We are also bolstering future-readiness in the green transition across our business strategies and operations. With decarbonisation increasingly a cornerstone priority for communities across Asia, we continue to expand our Sustainable Energy Solutions to customers in Singapore, China, Vietnam and Thailand, with offerings backed by in-house expertise and strategic partnerships.
Anchored on safety
Safety is an unshakeable tenet in everything we do. We count on every employee, contractor and partner to maintain a safe work environment, whether they are out at work sites, depots and substations or in the office. These collective efforts have led to a Lost Time Injury Frequency Rate of 0.22 – which means that an average of 0.22 injury occurred per million manhours worked over a period of 12 months. This is an all-time best performance for SP. It has also exceeded the target of 0.53 that we set for ourselves, benchmarked against the standards upheld by global utilities companies.
Safety first
Leslie Neo Wei Han
Deputy Director
Group Safety and Health
We are encouraged by industry recognition from various local and international bodies, affirming our strategies and approach. Holding fast to the belief that every life is precious and every accident is avoidable, we will continue to work closely with our contractors to uphold safe practices.
Financial resilience
The past financial year was marked by both optimism and uncertainty – optimism from the global economic recovery and increased business activity, and uncertainty due to geopolitical tensions, supply chain disruptions and inflationary pressures. Despite the challenges, SP recorded yet another year of strong financial results. For the year closing 31 March 2024, we achieved a net profit of S$1.11 billion – 7.5 per cent higher than last year. Our Return on Equity has increased to 8.8 per cent, from 7.9 per cent.
Now in our third year of executing SP’s Strategy 2030, the Group’s Net Revenue rose by 5.7 per cent from last year to S$2.9 billion.
While the revenue from our electricity and gas networks business continues to register stable growth in tandem with our continued investment in infrastructure, the revenue for our Sustainable Energy Solutions business has increased by 57 per cent to S$168 million.
The Group’s robust financial position, coupled with prudent financial management, allowed us to maintain the strong investment grade credit ratings of Aa1 by Moody’s and AA+ by S&P for the last three years.
World-class energy networks
Reliability and efficiency are at the core of electricity and gas transmission and distribution services to more than 1.6 million commercial, industrial and residential customers. According to international benchmarking, SP achieved a System Average Interruption Duration Index (SAIDI) score of 0.15 for electricity and 0.067 for gas supply for the year ending 31 March 2024. This means that a customer experienced an average interruption of only 9 seconds in electricity supply and 4 seconds in gas supply – our second-best performance in SP’s track record in global indices.
Behind the scenes, our dedicated teams of engineers and technical specialists ensure round-the-clock vigilance towards making this possible.
We have also undertaken the expansion of our networks to meet Singapore’s growing electricity and gas demand. Last year, we commissioned more than 200 km of additional cables and enabled supply connection for more than 2,000 new customers. At the same time, we continue to invest in renewing ageing assets to ensure reliability. For example, our teams renewed more than 200 km of distribution cables, 300 distribution transformers and 27 km of ductile iron gas pipelines.
Ensuring long-term reliability
Ang Shan Shan
Technical Officer
Electricity Operations
In line with Singapore’s push to maximise the use of subterranean space, we are building an underground electricity substation at Labrador. When fully operational in 2025, the 230kV substation will supply electricity to the southern parts of Singapore, including Alexandra, Telok Blangah, Keppel, Pasir Panjang, and the Singapore Science Park district.
With the completion of the substation’s underground structures last year, we are on track to have the equipment – namely five gas insulated transformers – energised by 2024. Concurrently being constructed above ground is the integrated Labrador Tower, a commercial mixed-use building fitted with SP’s sustainable energy solutions. It is one of the few buildings in Singapore to have attained the Super Low Energy Green Mark certification from the Building and Construction Authority.
The electricity grid will also be a key enabler for the decarbonisation of the energy ecosystem. A reliable and resilient grid is integral for the flow of electricity from solar energy and battery energy storage systems (ESS), charging of electric vehicles (EVs) and connecting renewable energy from regional countries in the future.
Shaping our energy future
Chen Li
Senior Principal Engineer
Transmission Planning
Last year in particular, a 60 megawatt-peak floating solar PV system on Tengeh Reservoir, as well as a 285 megawatt-hour ESS on Jurong Island, were connected to the electricity grid. The floating solar farm is one of the world's largest inland floating solar farms, while the ESS is one of the largest of its kind in Southeast Asia. For EVs, a key priority is supporting the immediate national target of having 2,000 Housing Development Board (HDB) carparks equipped with charging points by 2025.
Technology is central to the development of new energy solutions. In our pilot deployment of a Grid Digital Twin, 10 substations are now equipped with digital sensors, processors and communication solutions that enable more efficient remote operations, and intervention when anomalies are detected. Our Distributed Energy Resource Management System (DERMS) pilot is focused on real-time estimation of solar photovoltaic (PV) generation across the network to better manage the balance between supply and demand, and optimise grid operations and efficiency.
As we help our engineering teams navigate the evolving industry landscape, we have taken steps to ensure systematic knowledge and skills transfer.
In 2022, we launched the Technical Expert initiative, an in-house mentorship programme to deepen capabilities and know-how in the operations and maintenance of SP’s electricity and gas networks. Our pool of Technical Experts has grown from the pioneer batch of seven to 24 members in the past year, strengthening our pipeline of talent to safeguard our national grid.
Engineer, educator, enabler
Azhar bin Mohamed Noor
Principal Engineer
Gas Operations
Empowering every customer
As a provider of utilities services to every household and business in Singapore, we recognise the value of having timely information and convenient tools available to customers. This enables customers to make decisions and manage their usage for greater energy and cost efficiency while minimising environmental impact. We have augmented our digital infrastructure on several fronts.
With smart meters progressively being deployed nationwide, more customers are able to monitor and moderate their utilities consumption. As of March 2024, we have installed 900,000 smart electricity meters across residential and non-residential premises. We continue to work with PUB on the nationwide roll-out of smart water meters, with 260,000 already installed.
In partnership with the Energy Market Authority, we are piloting a Residential Demand Response programme to empower households equipped with smart meters to actively reduce electricity consumption during demand peaks in the power system. Targeted to be launched by the second half of 2024, this pilot is the first-of-its-kind in Singapore to call upon households to make a significant difference for a more resilient and sustainable energy future.
The SP app continues to be a leading utilities app in Singapore with over 1.6 million registered users. Continuous upgrades and new features ensure a comprehensive suite of features for seamless utilities transactions, as well as tips and tools for anyone to delve deeper into sustainable living easily and consistently.
We continue to anticipate and respond to changing trends and customer needs. Engaging customers at digital touchpoints anytime and anywhere, is increasingly preferred. As such, we have expanded our digital contact channels, transitioning from physical service counters and phone lines to mobile chat functions such as WhatsApp.
Serving with heart
Tony Tan
Senior Manager
Customer Experience
Concurrent with this scaling up of digital interactions, we recognise the importance of maintaining safe and secure platforms for engagement. At SP, we adopt a tightly coordinated approach to security in both the cyber and physical realm. In the past year, we set up a Fusion Centre that is resourced to facilitate integrated security management among internal business units, as well as with external agencies.
Growing our green footprint
In the past year, more customers have turned to SP’s Sustainable Energy Solutions to meet their sustainability goals. Revenue growth was at a strong 40 per cent per annum since FY 2021/2022.
In our flagship district cooling business in Singapore, capacity has risen by 30 per cent in the past three years to 206,000 refrigeration tonnes (RT) in operational and secured projects. This firmly anchors our position as Singapore’s largest district cooling network.
In expanding our Marina Bay district cooling network, SP will take charge of the operation of Suntec City’s cooling system which will then be interconnected to our network by 2027 via neighbouring developments. This will create opportunities to deliver energy efficient cooling to a wider range of developments in the area, including Marina Centre and Bugis.
SP has signed Memoranda of Understanding with City Developments Limited and Singapore Land Group to design, build, own and operate satellite cooling plants within Central Mall, Central Square and Marina Square. In our latest project with CapitaLand, SP will operate a distributed district cooling network at the new Geneo life sciences and innovation cluster at Singapore Science Park, comprising three properties with five buildings. SP will operate a total cooling capacity of 10,400 RT at Science Park.
Advancing the green transition
Christina Li
Principal Engineer
Sustainable Energy Services
Our renewable energy solutions have grown with expansion in the solar PV system market. At Frasers Property’s retail malls, SP will install and commission solar PV systems across seven malls by the end of 2024. This is SP’s single largest solarisation roll-out for retail malls. We have also made good progress on the solarisation of our substations. As at May 2024, we have completed the installation and commissioning of solar PV on 19 substations, aggregating to 10.6 MWp.
With the accelerating pace of EV adoption, SP’s role as Singapore’s leading charging operator has become more important than ever. Today, SP owns and operates over 1,400 public charging points across various property segments, including commercial and residential developments, and will install close to 5,000 charging points across more than 400 HDB carparks in the north-east and eastern parts of Singapore. At SingHealth Group’s campuses, we will deploy over 80 charging points across more than 10 locations by the end of 2024. Venturing into a new segment, SP has partnered Pyxis in Singapore’s first trial of an electric harbour craft charging point, deploying a direct current fast charger at Marina South Pier.
The engine for many of our sustainable solutions rests on our Green Energy Tech (GET™), developed by our in-house digital arm, SP Digital. Our GET™ energy management and indoor microclimate control solutions have been adopted by more customers in the past year, including Singapore Land Group, Allgreen Properties, Changi Airport Group, Maybank, Frasers Property and Centurion Corporation. We have also expanded our reach to new segments in light industries and worker dormitories.
SP is making steady progress in contributing towards Singapore’s vision to be a carbon credits trading hub. Since 2021, we have managed transactions of more than 2.9 million Renewable Energy Certificates (RECs) to 78 corporate entities including multinational corporations spanning over 10 geographies.
Expanding sustainable energy solutions in the region
SP’s Sustainable Energy Solutions in overseas markets has grown steadily in the last three years, signalling our role as value creators in enabling more businesses to augment their green transition.
In China, SP has cemented a strong foothold in the sustainable energy space with strategic government partnerships, greenfield and brownfield developments. As at May 2024, we have secured a total of 1.3 Gigawatt of solar projects and 58,000 RT of district cooling projects in China, across 18 provinces and municipalities.
We have invested in the first batch of agrivoltaics assets in Meizhou, an agricultural hub in the Guangdong province. With a total installed capacity of 78 MWp, the project will integrate solar PV and battery energy storage systems across four existing agricultural sites in the county. The project is expected to help Meizhou avoid over 91,000 tonnes of carbon emissions annually. In partnership with Qingdao Daneng Environmental Protection Equipment Co. Ltd., we are building a 90 MW aquavoltaic farm. Renewable energy generated will operate Shandong’s first solar-powered green hydrogen production plant. We have acquired 75 MWp of rooftop solar assets from Pufeng Xunlian Investment Co. Ltd, which has operations across 15 industrial sites in Anhui, Guizhou, Hebei, Heilongjiang, Henan, Hubei, and Shanxi. This will help China avoid more than 44,000 tonnes of carbon emissions each year.
In district cooling and heating, we will continue to deepen our presence in Guangzhou, Chongqing and Chengdu to cater to the high demand in these cities. In the past year, we acquired a 7,000 RT facility at Shudu Centre, our second district cooling and heating project in Chengdu.
In Vietnam, SP completed the acquisition of a sizeable solar plant in Binh Dinh province, central Vietnam. The plant generates 73 GWh of green electricity annually, amounting to an avoidance of 52,000 tonnes of carbon emissions each year. This brings our portfolio of utility and rooftop solar assets in operation and under construction in Vietnam to over 230 MWp as at May 2024. Frasers Property Vietnam, one of Vietnam’s leading diversified property developers, is tapping on SP’s integrated suite of smart energy solutions for its Binh Duong Industrial Park. This partnership will help the park accelerate the adoption of green energy solutions, and enable energy savings and carbon emissions reduction for its tenants.
Two years after our entry into Thailand, we have secured our first district cooling project at Government Complex Centre Zone C through our joint venture BNSP Smart Tech. This will enable energy savings of about 20 per cent and carbon emissions reduction of up to 3,000 tonnes annually, akin to removing about 20,000 cars from the roads over the 20-year contract period. As at May 2024, we have over 50 MWp of rooftop solar projects in operation and under construction, and a pipeline of over 100 MWp of projects across Thailand. At Rangsit University, SP will be deploying solutions including rooftop and floating solar PV systems with a centralised energy management and storage system to transform the campus into a smart energy, low-carbon academic environment. We are also partnering Malee Group, a leader in Thailand's beverage manufacturing industry, to green its energy mix through solar energy.
Building a future-ready workforce
Just as we empower our customers and markets with services and solutions to thrive and succeed, we are committed to empowering our own people for today’s priorities and tomorrow’s prospects of growth and transformation. From clear career pathways to structured training plans, we aim to build a resilient and future-ready workforce with tools, technology and talent to deliver value to all stakeholders.
In the last three years, we have invested more than S$25 million in the continuous learning and development of our employees who have collectively clocked 500,000 training hours. We have also deepened key capabilities such as engineering, cybersecurity and corporate functions, enabling us to deliver our strategy, seize opportunities and remain a leader in the markets in which we operate.
Growing from strength to strength
Muhammad Shamil bin Abu Bakar
Technical Officer
Electricity Operations
In close partnership with the Union of Power and Gas Employees (UPAGE), we have jointly introduced initiatives that prepare our employees for the diverse and evolving needs of the industry. For these sustained efforts, SP was awarded the Plaque of Commendation (Star) – the highest award for organisations – at the May Day Awards 2024 organised by the National Trades Union Congress, supported by UPAGE’s nomination.
Our holistic development and well-being programmes have resonated strongly with our people. Last year’s employee engagement survey saw the previous year’s record high score maintained, at 87.5 per cent.
Caring for the community
Sustainable giving is built into our company’s purpose and culture, as we support vulnerable groups across the age spectrum in the community, from seniors, to children and youth.
Last year, our stepped-up efforts through donations and staff volunteerism totalled about S$5.3 million. Among our philanthropic contributions was our third-year donation of S$1.1 million to KidSTART Singapore, bringing the total to S$3.2 million to date. This latest donation will benefit 2,000 more children, with access to educational resources such as digital devices, books and learning activities. The donation will also fund Green Adventures by KidSTART and SP Group, to introduce sustainability concepts and inculcate fun, green habits in children.
We have expanded our collaboration with Allkin Singapore through a S$350,000 donation to enable all-rounded development for students at the Allkin Student Academy. This donation will go towards enrichment programmes to boost academic and artistic development, including engaging workshops based on science and engineering topics, and vocal training.
In uplifting at-risk youth from lower-income families, SP donated S$500,000 to TOUCH Community Services, S$480,000 to Care Corner and S$350,000 to SHINE Children and Youth Services. These will fund nutritious meals, and educational, counselling and intervention programmes.
Last year, the annual SP Charity Golf saw a record S$700,000 raised for the SP Heartware Fund – the highest amount to date – thanks to the generous support of our business partners. The funds will go towards Community Chest programmes for more than 25,000 vulnerable seniors.
SP held its inaugural Volunteers Festival in October 2023, celebrating our spirit of volunteerism and inspiring more staff to come on board. Our staff volunteers, known as SP Heart Workers, shared their experiences while our social service partners presented stories of how volunteers play a pivotal role in the community. A highlight of the event was the launch of SP’s publication Heart at Work: A Guide to Corporate Volunteering. It provides tips on ways for staff to volunteer in SP’s community outreach, and serves as a toolkit for other organisations looking to build their corporate volunteering culture.
Our Heart Workers have led an array of volunteer activities and rallied more staff to make meaningful contributions of their time and talent with seniors, youth and children. Besides sustained collaboration with our key social service partners, they have also ensured the continuity of signature programmes, such as the annual charity drive to delivery 10,000 power packs to families in need. In a new development last year, the items in the packs have been differentiated according to age segments for more targeted benefit.
In a national-level pilot led by the National Volunteer & Philanthropy Centre, National Council of Social Service and SG Cares, SP participated in Project V to help shape and strengthen the spirit of corporate volunteerism. In this pilot, we deepened our partnership with Allkin Singapore, exploring ways to build on meaningful volunteer programmes with their seniors and children.
In recognition of SP’s holistic and sustained efforts in caring for the community, we received the highest accolade, the Pinnacle Award, at the Community Chest Awards. This was among a record four awards that SP received last year, with the Charity Platinum, Enabler, and Volunteer Partner Awards as part of the honours. The awards reflect the progression and growth in the breadth and depth of giving that has been made possible through the collective efforts of our employees, customers, businesses and social service partners.
In appreciation
To everyone who has played a role in our journey of empowering people and building communities, I am grateful for your partnership and contributions in making a lasting impact and propelling more opportunities for growth and synergy with our stakeholders.
I wish to thank my fellow Board members for their counsel and guidance. On behalf of the board, I extend my deepest appreciation to Mr Ong Yew Huat for his invaluable contributions. Mr Ong retired from the Board on 31 July 2024. I extend a warm welcome to Mr Ong Pang Thye and Mrs Ow Foong Pheng who joined the SP Board on 1 April 2024 and 1 June 2024 respectively.
I commend the management and staff of SP for their commitment and tireless efforts, often navigating unchartered waters and leading the organisation to new heights of achievement.
I would also like to thank our shareholder, business and community partners, union, and regulator for the continued support and trust in SP.
Leong Wai Leng
Chairman
August 2024
