Asia-Pacific to need $6T for energy

The Asia-Pacific region will need more than $6 trillion worth of investments in new energy infrastructure by 2030 to meet the projected doubling of energy demand by that time, according to the Asian Development Bank.

These investments, however, must not be poured solely into power projects using traditional fossil fuels, as the Manila-based multilateral lender stressed in documents posted at its website that countries must also look into investing in energy efficiency and renewable energy projects.

These clean energy projects, the ADB explained, will not only generate the much-needed additional capacities, but will also enable countries in the Asia-Pacific region to balance both economic and environmental priorities.

“Energy demand in the fast-growing economies of Asia and the Pacific is increasing as the region pushes its development and poverty reduction agenda forward and its people enjoy a more affluent lifestyle. However, this growth cannot continue to rely on fossil fuels. Dependency on the highly volatile oil market makes the region vulnerable to spikes in fuel and electricity prices, affecting household budgets, production costs, and national growth targets,” ADB energy specialist Aiming Zhou was quoted as saying.

According to Zhou, renewable energy sources, particularly the new ones like solar and wind, may seem more expensive than the power generated from oil, gas and coal. This, however, is without factoring in environmental costs, he added.

“Efforts are under way to achieve grid parity in the new renewable energy industry. The goal is to generate power at the same or less cost. Wind power is already at grid parity in some parts of the world and solar power is projected to reach grid parity in five to 10 years,” Zhou explained.

This week, the ADB is hosting its 7th Asia Clean Energy Forum in the hope of bringing together again stakeholders in this industry to exchange experiences and forge new partnerships with the same goal of advancing clean energy solutions in the region.

Over the past six years, ADB’s annual flagship event has progressively served as the premier knowledge sharing platform for learning and exchange of experiences on key issues and latest developments in clean energy.

ADB, for its part, has been strongly supporting clean energy projects in as many sectors, having reached its 2013 target of investing $2 billion in clean energy annually two years ahead of schedule. In 2011, ADB’s $2.1-billion investments in renewable energy and energy efficiency are expected to generate 3,298 gigawatt-hours of energy savings yearly and mitigate 13.7 million tons of carbon dioxide equivalent annually.

The ADB has also been advancing solar energy through the Asia Solar Energy Initiative and providing technical assistance under the Quantum Leap in Wind Power program. It likewise supports venture capital firms focused on bringing promising climate change-related technologies to commercial production.

Another initiative is the renewable energy certificate, a market-based tool to promote renewable energy. For example, if a region wants to support renewable energy, but does not have renewable sources, it can invest in the renewable energy certificate to reach its renewable energy target and avoid the penalty levied by the national or regional agencies.