Southeast Asia journey to adopt clean and low carbon technologies a bumpy one

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JANUARY 24, 2019 - 6:26 PM

Southeast Asian countries are beginning to transform the way energy is produced and consumed in order to transition to a low carbon, sustainable economy. But the journey has been a bumpy one and the region has overall been slower to adopt clean and low carbon technologies largely due to an ongoing dependency on coal. 

Experts interviewed for the white paper, "Power Trip: Southeast Asia's journey to the low carbon economy", noted that there is a high ongoing dependency on coal - particularly in countries such as Indonesia, Vietnam and Philippines - and the continued entrenchment of large state utilities in fossil-fuel power systems. 

Respondents from these three countries were the least optimistic that the region was on a clear path to a low carbon economy. For the Philippines, there was near consensus with almost 90 per cent of all respondents identifying insufficient policies and lack of access to funding as key obstacles to the Philippines’s transition to a low carbon economy.

Meanwhile, about three quarters of the respondents from Indonesia suggested insufficient policies and a lack of accessto funding as key obstacles in Indonesia’s transition to a low carbon economy, followed by fossil fuel subsidies. 

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Overall, respondents from Vietnam were the least confident out of all countries that their country would transition to a low carbon economy by 2030. The consensus was that lack of access to clean technologies and lack of access to funding were two main obstacles for Vietnam. These were followed very closely by insufficient policy/regulation and fossil fuel subsidies, respectively.

Other key findings from the survey include: 

1. The top three sectors most in need of investment in the region are renewable energy and storage, clean energy public transport systems, and energy efficient technologies and innovations.

2. The top three drivers in the transition to a low carbon economy were business leadership, local government initiatives, and consumer pressure and purchasing habits.

3. The top two barriers to the transition were insufficient policy or regulation and lack of access to funding.

4. The top three changes anticipated in this transition were that there would be increased environmental regulations, consumers and businesses would have more clean energy options and services, and investors and fund managers would reduce their investment exposure to high carbon assets and businesses.

Tim Hill, research director for Eco-Business who led the white paper, said: “It was exciting to get a sense of how the transition to a low carbon economy was developing from business leaders and other stakeholders in Southeast Asia. Although we noted some concerns about the pace of uptake of clean energy in some of the countries, it is clear that the technologies underlying the whole transition are enabling a more resilient and less polluted world - and there are going to be a lot of business opportunities in this new era.”

The report surveyed 562 senior government, business and civic society executives from Indonesia, Malaysia, Thailand, the Philippines, Singapore and Vietnam between August and September 2018. The report was launched at the Asia Clean Energy Summit 2018 and is the first of its kind in Southeast Asia that outlines the drivers and barriers faced by specific countries in the region in their transition.