Singapore's Keppel inks power supply deal with chipmaker GlobalFoundries


In 2023, GlobalFoundries opened a $4 billion facility in Singapore. (Photo: GlobalFoundries)

The infrastructure unit of global asset manager Keppel Cooperation will supply electricity to the Singapore operations of semiconductor manufacturing giant GlobalFoundries under a multi-year agreement, the group said on Jan 9.

The collaboration is a testament to the key role of reliable and sustainable energy in powering the advanced manufacturing procedures in the semiconductor industry, known for its energy-intensive operations.

According to the deal, from May Keppel's existing power plants will supply between 150 MW and 180 MW of electricity annually at GlobalFoundries' Singapore site.

US-based GlobalFoundries is also expected to be a long-term buyer from Keppel Sakra Cogen Plant (KSC), which is being developed with Singapore's Jurong Engineering and Japan's Mitsubishi Power.

"GlobalFoundries is expected to contract about 25% of KSC's total generation capacity for over 15 years when the plant is operational," according to the companies' joint statement.

With power from KSC, which is set to be completed in 2026 with total annual capacity of approximately 600 MW, GlobalFoundries targets to reduce up to 70,000 tons, or 10%, of annual CO2 emissions at its Singapore site.

"With the ability to use hydrogen as part of its feedstock, it is expected that KSC will be able to supply GlobalFoundries with even lower-carbon power in future," said the companies.

GlobalFoundries also has an option to switch part of the power supplied by Keppel to renewable energy like wind and solar as it targets a 25% reduction in total greenhouse gas emissions by 2030.

Semiconductor manufacturing is particularly energy-intensive due to a long and complex manufacturing process. (Photo: Shutterstock)

The chipmaker, a Nasdaq-listed firm, competes with Taiwan's TSMC and South Korea's Samsung Electronics among others. It opened a $4 billion semiconductor fabrication plant in Singapore last September as part of a large global expansion.

This deal underscores Keppel’s commitment to supporting Singapore’s high-tech industries’ energy needs, emphasizing the country’s efforts to maintain robust infrastructure for key economic sectors. By supplying power to GlobalFoundries, Keppel is contributing to the competitiveness of Singapore’s semiconductor industry, which plays a vital role in the global electronics supply chain.

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