Southeast Asia Renewable Energy Market
Market News

Southeast Asia Renewable Energy Market

According to estimates, by 2050, nearly half of the world's electricity will be generated by wind and solar power. Since the 1970s, fossil fuels have accounted for most of the world's electricity. By the middle of the 20th century, global electricity production will be converted from two-thirds of fossil fuels to two-thirds of renewable energy.
Published: Jun 02, 2021
Southeast Asia Renewable Energy Market

Global renewable energy

It is estimated that US$11.5 trillion will be invested in new power generation equipment, of which US$8.4 trillion will be used for wind and solar energy, and US$1.5 trillion will be allocated to zero-carbon technologies for water, hydrogen and nuclear energy. In addition, the reduction of battery materials and costs will also help promote the global application of renewable energy. Technological innovation has reduced the cost of solar materials from US$79/W in 1975 to US$0.37/W in 2017; and the price of turbines has also fallen by 32% since 2010. In addition, the global production capacity of production equipment increased from 16% in 2000 to 31% in 2016.

The advent of cheap energy storage systems means that the power transmission of wind and solar energy will become more and more reliable, even when there is no wind and sun, it can still supply electricity stably. In a gradual way, renewable energy will gradually replace the existing energy market, such as coal, natural gas, and nuclear energy. Natural gas is expected to grow steadily after 2050. It will only become a backup fuel when renewable energy is extremely scarce and the output is the lowest, but it is expected to have a place in the energy market.

In response to the recent recovery of the U.S. coal industry, it is expected that coal will fall sharply after reaching its peak in 2027. It is estimated that by 2050, coal's share of global power generation will drop from 38% to only 11%. Currently, large countries that rely mainly on coal for power generation, such as China and India, are also moving towards a clean energy path.

From 2009 to 2019, major public finance investments in China, Japan, and South Korea spent USD 78.9 billion on coal and natural gas, making them the world's largest public finance investor in fossil fuels. However, changes have taken place in 2020. As China, Japan and South Korea have successively made climate commitments, there are now reports pointing out that in the next ten years, the renewable energy market in Southeast Asia will have an investment opportunity of US$205 billion.

According to the report, Southeast Asia will have US$205 billion in renewable energy investment opportunities in the next ten years, which is 2.6 times that of the coal market in the past ten years. Because of the recently announced carbon neutral commitments of East Asian G3 countries (China, Japan, South Korea), it has become the main driving force for the Public Development Bank (PDB) to start investing in the Southeast Asian renewable energy market.

Renewable energy opportunity is coming: global coal investment is declining In the past, China, Japan, and South Korea invested many funds in fossil fuels, and they were the world’s most important public investors in fossil fuels. However, as more than 100 large banks and insurance companies around the world withdrew from the fossil fuel industry, international investors’ The change in investment targets and whether the funds transferred from the fossil fuel industry can flow to renewable energy will greatly enhance the process of the global energy transition.

East Asia G3 is the world's largest energy investment unit and has established close links with the Southeast Asian market. With the decline of coal investment, many banks are slowly turning to invest in renewable energy. The climate crisis has also affected the flexibility and originality of the East Asian financial industry. The government-backed public development bank needs to play the role of pioneer again to break into new markets.

The report pointed out that from 2021 to 2030, Southeast Asia’s demand for the development of renewable energy will increase rapidly, requiring a large amount of capital injection. Among them, solar energy investment is estimated at 125.1 billion US dollars, wind energy investment is 48.1 billion US dollars, and other renewable energy investments are 32.6 billion US dollars. In addition, emerging green bonds issued in Southeast Asia are prompting international investors (both public and private) to withdraw from fossil fuels.

As early as 2019, many international banks announced the divestment of coal-fired power plants, witnessing the decline of the fossil fuel industry. In the past two decades, despite the surge in investment risks, the Bank of East Asia is still inclined to invest in coal to maintain the profitability of fossil fuels. In the next ten years, we will see these banks turn to support renewable energy.

The energy transition is not only for the climate but also for the economy With the rapid development of industry and economy in Southeast Asia, the region is also one of the area’s most vulnerable to climate change, including coastal floods, super typhoons, droughts, and other extreme weather events, which threaten lives and properties of local people. However, the current energy structure of Southeast Asia is still dominated by coal and natural gas, and it continues to emit greenhouse gases that are aggravating global warming. If these countries do not start energy transition from now on, extreme disasters caused by climate change will occur more frequently, and they may even go into decline and setbacks.

At a turning point in the energy transition, the East Asian Public Bank is strong enough to support investment in the Southeast Asian renewable energy market. For East Asian regional banks that have a long-term cooperative relationship with the local area, investing in green energy in the region is also of considerable financial significance. Taking Japan as an example, banks can simplify funds into regional investment through Japan’s joint credit and other mechanisms to promote investment in low-carbon technologies.

It is not only the East Asian G3 that sees the investment potential of Southeast Asia, but Taiwanese companies are also eager to see it.

Foxlink, the largest electricity seller in Taiwan, is part of Apple's supply chain. To meet its demand for renewable energy, the group has a total area of 14 hectares of global factories and rooftop solar photovoltaic systems. In addition to generating electricity, selling electricity, and investing in international renewable energy, we are now looking at the abundant water resources in Southeast Asia and turning our target to the potential market opportunities for renewable energy in Southeast Asia.

Local companies and governments in Southeast Asia have begun to attach importance to the development of green energy

At present, although East Asia is still the main energy investor in Southeast Asia, more and more local enterprises and the public are willing to invest in renewable energy. 72% of the investment in solar photovoltaic systems in the region comes from the local area of Southeast Asia.

Take Vietnam’s solar photovoltaic market as an example. With the continuous progress of local energy policies, the volume of solar photovoltaic devices in Vietnam has jumped from 134MW in 2018 to about 5.5GW in 2019 in just one year. It also makes Vietnam the country with the largest amount of solar photovoltaic installations in Southeast Asia, accounting for 40% of the regional total.

In addition, local governments and industry players have also developed more financial tools tailored to local conditions, such as green bonds, solar auctions, feed-in-tariff (FIT), etc., which have become key factors in the vigorous development of the renewable energy market.

In the development of solar energy, the Ministry of Energy of Thailand published the Thailand Integrated Energy Blueprint (TIEB) in September 2014. It plans to account for 30% of renewable energy by 2036, of which solar energy will account for 22.30% in 2016. It will grow to 30.50% in 2036. In 2017, the International Renewable Energy Agency (IRENA) also stated that the capacity of solar installations in Thailand can be increased from the originally expected 6GW to 17GW, which can reduce energy expenditure by more than US$9 billion per year. This will be a major turning point for Thailand's overall economy.

While Southeast Asia is vigorously developing renewable energy, and many countries and regions around the world have successively announced carbon neutrality commitments and more aggressive energy policies, Taiwan’s contribution to global carbon reduction is still lagging. Not only is the energy transition of enterprises slow, but the government is also concerned about improving carbon emissions. The goal is still slow, which is an issue that Taiwan should carefully examine and implement.

The energy transition is still an unfinished road, and whether large electricity users can actively transition to green energy will be the key. We invite you to protect the earth’s homeland and encourage governments and enterprises to accelerate their efforts to reduce carbon emissions. Supervise the progress of Taiwan's energy transition and create a more universal and comprehensive sustainable energy development future for Taiwan.

Published: Jun 02, 2021 Source :greenpeace

  • Asia / Pacific
  • Renewable Energy

Further reading

You might also be interested in ...

Headline
Market News
Current Status of Taiwan's Transportation and Shipping Industries Under the Epidemic
Transportation is the main artery of the city. A well-functioning transportation system must be closely linked with the three major elements of "people, vehicles, and roads." In order to optimize traffic efficiency and optimize the energy use and mobility efficiency of cities, countries have introduced smart mechanisms in recent years.
Headline
Market News
Global Economic Market Prospects for 2021
The United States, the European Union, and China are the world’s three largest economies, which together are estimated to account for 60.92% of the global economy in 2021.
Headline
Market News
South Korea's Future Economic Blueprint and Investment Strategy After Ten Years
South Korea is a country lacking natural resources. Its economic development is export-oriented, and its industrial structure is dominated by heavy chemical industries. The five major industries, including automobiles, shipbuilding, semiconductors, steel, and smartphones, earn a lot of foreign exchange for the country's economic growth.
Headline
Market News
South Korea Ranks Third in The World in Terms of Manufacturing Competitiveness
The United Nations Industrial Development Agency (UNIDO) announced the World Manufacturing Competitiveness Index (CIP) in July 2020 based on the 2018 indicators. South Korea ranks third after Germany and China among 152 countries in the world. CIP is a composite index of 8 items including per capita manufacturing value-added and manufacturing export value. It reflects the overall competitiveness of the manufacturing industry in each country. UNIDO publishes it every other year.
Headline
Market News
Trends in Japan's Manufacturing and Machinery Industry
Although the share of manufacturing in Japan's GDP has declined in the past few decades, Japan still has a very large manufacturing base. In addition, Japanese manufacturers have extensive global connections, especially in Southeast Asia, many of which have substantial operations in countries such as Thailand.
Headline
Market News
The Labor Cost Advantage of Mexican Manufacturing Industry
There are many reasons for manufacturers to move offshore or near-shore production bases to Mexico. The advantage of cheap labor is one of the most prominent.
Headline
Market News
Analysis and Forecast of the British Manufacturing Market
The manufacturing industry occupies an important position in the British economy. Although the UK has declined in industrial scale, it still has the world’s top companies in steel, pharmaceuticals, biological breeding, aerospace, machinery, microelectronics, military, environmental sciences, etc. All aspects are among the best in the world.
Headline
Market News
The Development Trend of Aerospace Emerging Surface Treatment Technology
The spraying technology process has a wide range of applications, including industrial industries such as steel, printing, aerospace, optoelectronics, corrosion protection, and petrochemicals.
Headline
Market News
Analysis of Global Electric Vehicle Markets
In 2021, the global electric vehicle market will grow by 40%, with total sales exceeding 3 million units. As of 2019, more than 2 million electric vehicles have been sold worldwide, accounting for 2.5% of all vehicle sales. It is estimated that the compound annual growth rate of global electric vehicles in the next ten years will reach 29%; the total sales of electric vehicles It will increase from 2.5 million in 2020 to 11.2 million in 2025 and 31.1 million in 2030.
Headline
Market News
The Rise of Electric Vehicles, Subverting the Auto Industry
With the rise of the global electric vehicle market, how should Taiwan’s opportunities be grasped?
Headline
Market News
The Prosperity of the Electric Vehicle Market and the Development of Power Battery Systems
At present, ordinary automobiles mainly use fossil fuels as their power source, which not only consumes a lot of petroleum resources but is also one of the main culprits of greenhouse gas emissions. In order to cope with the global trend of energy-saving and carbon reduction, many countries have adopted vehicle electrification as a greenhouse gas reduction important measure.
Headline
Market News
The Development of the Global Shoe Industry
The global production chain is constantly shifting, and so is the shoe industry. How should the trend of the shoe industry develop in the future?
Agree