Clean energy investment ‘woefully off track’
Southeast Asia needs to step up efforts or risk missing climate pledges, report says
Southeast Asia is “woefully off track” on green investments to reduce emissions and needs new policies and financial mechanisms to help bridge the gap, consultancy Bain & Co said yesterday.
With energy consumption in the region expected to grow by 40 per cent this decade, climatewarming carbon emissions remained on the rise, with the region still dependent on fossil fuels, said an annual report compiled by Bain, green investment group GenZero and Standard Chartered Bank.
While green investment rose by 20 per cent last year, it was way short of the US$1.5 trillion required this decade, and emissions in the 10 countries in the region could overshoot 2030 pledges by 32 per cent if they continued on their current trajectory, it warned.
“We believe an acceleration of efforts by countries, companies and investors is imperative as Southeast Asia remains woefully off track,” GenZero managing director Kimberly Tan said.
Clean energy accounts for just 10 per cent of total supplies, and fossil fuel subsidies are around five times higher than renewable investments. High capital costs, as well as uncertain grid and tariff regulations, have also made it harder to finance renewable projects. Meanwhile, only four of the 10 countries in the region – Indonesia, Malaysia, Singapore, and Vietnam – have made progress in putting a price on carbon.
The report called for more policies and incentives, greater regional cooperation and a sustained focus on technologies that were already deployable.
“The good news is Southeast Asia is very early on its decarbonisation journey so benefits from having many levers to reduce emissions today,” Tan said.
The report identified 13 “investible ideas” that could bring in US$150 billion in revenues by 2030, including sustainable agriculture and utility-scale renewable energy plants.
Southeast Asia is the secondworst-performing region when it comes to renewables investment, behind only sub-Saharan Africa, according to an April report by Singapore’s Economic Development Board and consultancy firm McKinsey.
We believe an acceleration of efforts by countries, companies and investors is imperative KIMBERLY TAN, GENZERO