How can we accelerate the green energy transition in Asia-Pacific? 3 leaders weigh in
The Asia-Pacific (APAC) region plays a central role in the global efforts to reach net-zero and achieve a green energy transition.
The region is home to five of the 10 largest emitters in the world (China, India, Indonesia, Japan, and South Korea) and accounts for about 45% of global greenhouse gas emissions due to its significant population, McKinsey & Company reports.
It’s also a diverse region that requires localized solutions. India, for instance, is at a critical decision-making point as it seeks to deliver an unprecedented expansion of energy supplies to satisfy its rapidly growing economy in a way that fulfils the government’s 2070 net-zero emissions pledge.
“On one side, India can continue its dependence on oil-rich nations that supply energy fuels and blue hydrogen carriers towards the transition while sometimes exposing itself to crippling international prices,” as noted by field experts.
“The alternative route would see India invest heavily in research, development and demonstration to drive down the cost of electrolysis and to complement, and capitalize on, its status as one of the world’s lowest-cost producers of solar power.” Towards this end, the authors argue, the path to a prosperous, clean energy future in India would lie with green hydrogen, not blue.
As more countries in the region pick up the pace of development and achieve progress against the backdrop of an ongoing energy crisis, so does the urgency to act with effective transition models.
The Asia-Pacific nations experience more natural disasters than any other region. Between 2014 and 2017, countries in this region were affected by 55 earthquakes, 217 storms and cyclones, and 236 cases of severe flooding, impacting 650 million people and causing the deaths of 33,000 people.
Rapid urbanization and inadequate planning make densely populated urban areas more vulnerable to the effects of climate change, particularly near coastal regions and large rivers.
With this context, we asked leaders how the Asia Pacific region can prioritise energy efficiency and renewable energy in the coming year, while focusing on the role of industries.
Here’s their vision for accelerating the green energy transition in the region.
“Energy transition is a long, arduous journey that requires cooperation, patience, understanding, and determination”
Ashok Lavasa, Vice-President for Private Sector Operations and Public-Private Partnerships of the Asian Development Bank (ADB)
The Asia-Pacific region contributes significantly to global greenhouse gas emissions from fossil fuels and is home to hundreds of millions of people who do not have adequate access to electricity or clean cooking fuels. Bold and sustained action is needed to address these issues.
And this action must be inclusive.
Energy transition is a long, arduous journey that requires cooperation, patience, understanding, and determination. It is bound to bring about major changes, and every change could face resistance.
It is important to ensure that all stakeholders are informed, consulted, educated, and involved for achieving an enduring, sustainable, and just transition. The Asian Development Bank (ADB) realizes that to substantially increase the uptake of affordable, clean, modern and reliable energy systems, developing countries will need enabling policies, technology transfers, and additional concessional financing.
In 2021, ADB adopted its new energy policy aimed at helping our developing member countries (DMCs) accelerate the low-carbon transition in Asia-Pacific. The energy policy highlights a wide range of key priorities and technologies that should be considered by our DMCs, particularly in energy efficiency and renewable energy.
ADB is implementing several innovative initiatives to support the energy transition, such as the flagship Energy Transition Mechanism (ETM) to sustainably retire coal power assets early and replace them with clean energy. In 2019, we established the ASEAN Catalytic Green Finance Facility to increase green infrastructure investments in Southeast Asia. With ADB Ventures, we support and invest in start-ups offering impact technology solutions that contribute to achieving Sustainable Development Goals. These are some examples of the initiatives we have in place – there are many more to come.
“Is repurposing of coal infrastructure and assets to renewable energy a significant part of the answer?”
Peter Lacy, Global Sustainability Services Lead & Chief Responsibility Officer, Accenture
As the energy transition gains speed, the transition away from coal to renewable energy sources will play a vital role in accelerating it, especially in Emerging Markets and Developing Economies, which are home to 75% of the world’s coal power.
Part of this transition must involve repurposing the oldest and most inefficient coal power plants into renewable energy assets.
The levelized cost of electricity for newly installed renewable energy has been steadily decreasing and, in about 77% of instances, is cheaper than coal power. This figure is expected to increase to 99% by 2030.
The ability to replace capacity on the same site as the decommissioned coal power plant, i.e., repurposing coal power plants into renewable energy plants, brings additional benefits. Examples include Enel and EDP repurposing Teruel and Sines coal plants in Spain and Portugal, respectively. Among these benefits include enabling the reuse of existing land, leveraging existing interconnection lines, re-employing the workforce, and reusing some key equipment assets.
“Taking the diverse needs, natural endowments and differing societal conditions of this enormous region into account is the first step”
Shunichi Miyanaga, Chairman of the Board at Mitsubishi Heavy Industries
The Asia-Pacific region is still home to people crying out for more electricity to improve their lives, and it is a vital source of many of the goods enjoyed worldwide.
Taking the diverse needs, natural endowments and differing societal conditions of this enormous region into account is the first step to pursuing a just and affordable energy transition.
Squaring this circle will require all the deployable technology and sustainable fuels at our disposal: from cleaner use of existing infrastructure such as more efficient gas turbines and CCUS to developing fully-fledged hydrogen and CO2 ecosystems. For example, MHI Group is developing 100% hydrogen-fired gas turbines by 2025 and delivering world-leading CO2 capture systems.
The technology exists. Scaling it up adequately and rapidly enough is the real challenge. Government incentives will need to play a part, but we must also share know-how and best practices, and international cooperation will be key.
I believe it is in our power to restore our environment and create a better future, for Asia and the world.
Source: World Economic Forum