Temasek Sits at a Renewable Energy Crossroads

Posted on 10/21/2019

Singapore’s Temasek Holdings is an investor in energy and is still open to investing in fossil fuels such as oil, natural gas, and coal. However, Temasek is looking at forming a new subsidiary to invest in renewable energy projects. Temasek has already seeded a number of ventures including Santa Monica-based Cypress Creek Renewables, a developer and owner of solar generating assets. In January 2019, Cypress Creek Renewables experienced a round of serious layoffs – some 20% of its workforce – and in June 2019 replaced the founder CEO with Sarah Slusser. Slusser came from solar development company Point Reyes Energy Partners, where she was a managing director. Ned Hall, a former executive at AES Corporation, replaced Ben Van de Bunt as Cypress Creek Renewables’ chairman.

Temasek is seeking to back cheaper and cleaner sources of energy. Temasek views natural gas as a relatively-clean source of energy and has backed numerous companies including FTS International Inc.

Temasek is willing to back some greenfield projects to achieve higher than single-digit returns in investments. However, Temasek does not want to be a solar power developer on its own. The wealth fund is considering two options. The first is the financial partner route, which would be similar to Temasek subscribing to shares in Cypress Creek Renewables. The other would be building a platform like Pavilion Energy Pte. Pavilion Energy has a license to import liquefied natural gas (LNG) into Singapore. In June 2019, Pavilion Energy agreed to buy Spanish energy company Iberdrola’s portfolio of LNG assets.

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