The Asian Development Bank has urged the Philippine government to exert more effort in maintaining the contribution of renewable energy sources to the country’s energy mix to help ensure the country’s energy security over the long-term.
Based on the transcript of an online exchange held last week, ADB senior economist Minsoo Lee said that the contribution of renewable energy sources to the country’s power supply is expected to shrink from a hefty 43 percent as of 2010, to only 14 percent by 2035, just when indigenous gas coal reserves are expected to be depleted.
Lee, who is also the lead author of the Asian Development Outlook special chapter on energy published two weeks ago, cited the potential contribution of solar power in the country, especially when this resource becomes more cost-competitive for the remote communities and islands in the Philippines.
But he admitted that, while renewable energy sources have great potential, they are not yet cost-competitive, particularly in the Asia-Pacific region. Lee noted that the current generation costs for wind and solar resources are still much higher than traditional energy sources.
Also, resources like solar and wind cannot provide power 24 hours a day and, therefore, cannot be considered basic power generation sources, he added.
Still, Lee stressed the need to reverse the huge reliance of countries in the Asia Pacific, like the Philippines, on fossil fuels to drive growth while delivering clean, affordable power.
“Developing Asia’s insufficient energy endowment has many implications. The most significant implication is its oil imports, which will triple by 2035. In 2010, Asia imported nearly half of all crude oil traded on international markets. Control of Asia’s oil supply has steadily shifted toward Middle East suppliers,” Lee said.
“In 1990, 33 percent of developing Asia’s oil imports came from the Middle East and in 2010, the figure has risen to 48 percent. As this trend is likely to continue, Asia’s high growing dependence on a single region poses a risk for adequate and reliable energy supply,” he pointed out.
Lee noted that developing Asia would need to address three key factors if it hoped to ensure energy security: adequacy and reliability of physical energy supply; environmental sustainability; and affordable access for inclusive growth.
“Demand management, tapping new technologies, exploring relatively clean unconventional gas, like shale gas, along with regional cooperation and integration could drive Asia’s sustainable growth without causing environmental damage,” he explained.
Apart from harnessing renewable energy, Lee noted that a joint exploration of prospective oil and gas blocks in the South China Sea may help address Asia’s energy challenges. But regional cooperation and integration will have to come into play so that the region may hurdle the existing political and regulatory barriers.
As for nuclear, the ADB maintains its current policy of non-involvement in the financing of nuclear power generation because the resource poses a number of barriers, such as public concerns related to nuclear proliferation, waste management and safety issues.
“There are alternative ways to produce clean energy. It is each country’s decision to build new or more nuclear power plants,” he said.