EDP Renewables APAC 254.8MWp Solar Farm in Thuan Bac, Vietnam

The Fight Against Coal In Southeast Asia

Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!

The Association of Southeast Asian Nations (ASEAN), which accounts for almost a dozen countries, includes several of the fastest growing economies in the world. Unfortunately, much of the energy that is fueling this economic development is coming from oil, natural gas, and most concerningly, coal. Approximately 40% of the power generation across the region continues to be from coal-fired power plants. While there has been a push for clean energy development throughout the region, significant concern remains that this will be outpaced by the growing energy demand and make the GHG emission reduction benchmarks set by these countries unreachable. 

Up until this point the majority of solar and wind projects have been directed at two countries in the region: Vietnam and the Philippines. Of the 222 GW of utility-scale solar and wind projects that are currently in the pipeline across ASEAN countries, more than 80% is focused on these two countries. Vietnam has far and away the largest market for utility-scale solar and wind projects. 

Countries in the region are looking to improve policy frameworks which allow them to grow their renewable energy industries. Approved in May of 2023, Vietnam’s Power Development Plan VIII (PDP8) outlined targets for both wind and solar development. A report from the Center for Strategic and International Studies on Clean Energy and Decarbonization in Southeast Asia found that along with investment in renewables comes the need to invest in hydrocarbons, most notably natural gas. Without natural gas as an alternative, the reliance on coal will continue. Using liquified natural gas as a “cost-effective bridge” reduces the green-house gas emissions significantly.

To better understand the drivers of renewable development, I spoke to Dinh Nguyen-Phan, the Country Director of Vietnam for EDP Renewables APAC. On the topic of reducing the reliance of Vietnam on carbon energy sources, Dinh highlighted the need to scale up renewable investment through advancing clean energy policies and enhancing regulatory frameworks to create favorable conditions for renewable energy development. This would provide investment clarity, improve investor confidence, streamline permitting, and improve grid distribution quality. Focusing on enhancing regulatory frameworks and simplifying the process to install renewable generation facilities would further improve the attractiveness and stability of long-term investments.

Chip in a few dollars a month to help support independent cleantech coverage that helps to accelerate the cleantech revolution!

With the fastest growing economy in the world which is expected to become the 4th largest in the world by 2050, Indonesia is understandably hesitant to commit to policies which may inadvertently slow economic growth. As the region’s most populous country, Indonesia accounts for 40% of all energy consumed. Despite these hurdles, Indonesia has committed to net zero by 2060 or earlier. This may prove more difficult due to the presence of relatively young coal-fueled power plants that represent over 60% of the country’s power generation.1

Initially, a lot of the power that will be required to shift Indonesia will come from hydropower and geothermal sources as the cost of solar energy remains relatively high. Much of the struggle to shift to renewables is financial. The closing of coal plants and necessary growth of clean energy would cost around $25 billion per year through 2030, a big jump from the $3 billion invested in total between 2017-2021. The Philippines, with its energy matrix consisting of 55% coal, set ambitious renewable energy and carbon reduction targets, but will require significant international support to reach these goals. While less reliant on coal than other countries in the region, Thailand still receives 77% of its energy from oil, natural gas, and coal. However, due to Thailand’s high solar potential the country expects to generate half of their electricity by renewable sources by 2040. 

There are several roadblocks to the development of renewable energy projects that hold true across the entire region. The first of these is the continued growth of energy demand across the region. With energy demand expected to triple, there is fear that this will lead to higher reliance on coal and will make the objective of many of these countries to reach carbon neutrality by 2050 to be unfeasible. New policies are needed to address demand growth. Coal usage is expected to peak in 2027, but will likely remain a major part of the energy matrix in Indonesia and the Philippines for as long as it is made available and affordable. The second region wide struggle is the need for increased funding. The average annual renewable investment in the region, which was approximately 70 billion between 2016-2020, will need to increase to 190 billion to achieve the climate goals for 2030. By addressing these struggles now, countries across the region can continue to grow their economies while developing strong renewable energy industries.


Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.

Latest CleanTechnica.TV Videos

Advertisement
 
CleanTechnica uses affiliate links. See our policy here.

Otto Gunderson

Otto graduated from the University of Virginia class of 2022 with a degree in history. He has been involved in clean energy, specifically solar and circular economic practices, for four years now and has been writing about clean energy for 2 years. Due to a lack of writing on the clean energy transitions in South America and Africa, Otto decided to spend his 2023 traveling across these continents, interviewing clean energy entrepreneurs, researchers, and disruptors and publishing their stories.

Otto Gunderson has 35 posts and counting. See all posts by Otto Gunderson