Similar research centres in the US, Europe and Japan have capacities of less than 500kW.

The power grid project in Singapore, the first in Southeast Asia, could also allow electricity from renewable energy sources like solar and wind to be fed into the grid system.

Owners of electric vehicles could potentially be able to sell any surplus energy back to the power grids.

Singapore’s A*Star’s Institute of Chemical and Engineering Sciences will lead the venture and find partnerships with companies to develop these smart grids.

Singapore firms SP PowerGrid and CEI Contract Manufacturing signed agreement on Friday to work at the new Experimental Power Grid Centre (EPGC) on Singapore’s Jurong Island.

Wind turbine giant Vestas and engine maker Rolls-Royce also signed letters of intent for future collaboration.

The EPGC is scheduled to be ready in the second-half of 2011.

A*Star hopes to see ten big companies working in partnership with the new centre once it becomes operational, according to Low Teck Seng, deputy managing director for research at A*Star.

“What we hope to achieve is a contribution to developing Singapore as a living lab for companies that hope to experiment with and develop new technologies that could see applications in the new economies of the future,” Low says.

Ravi Menon, Singapore’s permanent secretary at the ministry of trade and industry, says many grid systems around the world are not equipped with new demands being placed on them.

These demands include integrating renewable energy sources, the increasing use of different sources of power in the chemicals and pharmaceuticals sectors, and consumer demand for more information, choice and control in their energy use.

The research centre will boost ‘emulators’ that are able to mimic other energy sources such as wind turbines and solar panels.

“Innovation and development of energy technologies are vital to the growth of the global smart grid industry, which is expected to be worth $187bn by 2015,” says Lim Chuan Poh, chairman of A*Star.

A smarter grid would allow more detailed feedback on the status of the grid and help operators stay ahead of potential blackouts, and supply and demand would also be easier to balance.