Cleaner energy for all
Asian countries embrace the idea of interconnected grids to help the region cope with rising power demand and deal with climate change.
It sounds like a pipe dream when Liu Zhenya talks about China’s aspiration to become the regional leader in renewable energy. Such talk appears at odds with the image many people have of smoke-belching fossil-fuel power plants and some of the world’s most polluted cities.
But the chairman of Global Energy Interconnection Development (GEIDCO), a government-backed renewable energy infrastructure specialist, has the facts to back his ambitions. In 2015 alone, Chinese entities invested US$103 billion — 36% of the world total and more than the United States, the United Kingdom and Japan combined — in renewable energy projects worldwide. Acquisitions included hydro, wind and solar projects across Asia, as well as in Germany, Portugal, Italy and Brazil.
At home, China is dealing aggressively to curb pollution and reduce its dependence on fossil fuels, especially coal, which it aims to cut by 30%. The changes can’t come too soon — an estimated 1.6 million people, or 4,400 per day, die each year from respiratory diseases linked to air pollution in China, according to a 2015 report by Berkeley Earth, a California-based climate research group. The economic cost of air pollution is equivalent to 6.5% of China’s annual GDP, which works out to $715 billion, according to the RAND Corporation, a US-based research organisation.
Mr Liu is a keen advocate of a plan to help many countries in Asia scale up renewable energy use more quickly, helped by regional transmission and distribution networks.
“They key to promoting energy transition in Asia lies in the massive development opportunity to develop and distribute clean energy,” he said at the first session of the Committee on Energy, a high-level meeting organised by the UN Economic and Social Commission for Asia and the Pacific (Escap) in Bangkok on Jan 17. The event attracted senior policymakers from more than 30 countries including Mongolia, Nepal, Sri Lanka, Fiji, Kazakhstan and other Escap members.
Mr Liu used the event to elaborate on the concept of “large-scale allocation” by way of Global Energy Interconnection (GEI), a platform to create a new energy development pattern and connected infrastructure, to deliver energy via trans-boundary power grids for sale to other countries.
GEIDCO was founded last March by State Grid Corporation of China (SGCC), the largest electricity transmission entity in the world. It plans to create a series of trans-border energy grids linking renewable energy projects in China with other power generators in the region.
Electricity is expected to come from hydropower dams on rivers in Yunnan, thermal, coal-fired, wind and solar projects in Xinjiang, hydroelectric dams in Tibet, and a coal-fired power plant in Kazakhstan.
SGCC has already signed memoranda of understanding for power interconnection in Northeast Asia with companies in South Korea, Japan and Russia. The project is expected to help many countries save money on energy infrastructure.
“To be more specific, we aim to accelerate the development of clean energy in northern China, Mongolia and Russia to transmit the electricity to eastern China, South Korea and Japan,” explained Mr Liu. “This way, we can realise interconnection in Northeast Asia.
“At the same time, we should also speed up the pace to construct power grids in southern and Southeast Asia so they are connected within the region where clean energy from China, Central and West Asia could be transmitted to meet the demand in India, Pakistan, Bangladesh and Southeast Asian countries.”
Russia is also enthusiastic about the idea. Energy is a key element of the new Russian economic and strategic “pivot” to the East, which began in 2014 as it faced economic sanctions by Western powers over its annexation of Crimea.
Russia is advocating an “energy super ring” that would integrate the networks of Russia, Japan, South Korea, China and Mongolia. The ring would consist of a series of energy bridges, one of which for example would connect Russia’s Sakhalin with Japan. The Japanese technology firm SoftBank has already proposed a joint venture with the Russian manufacturing group Rosset as a step toward power transfers from Russia’s Far East to the island nation.
Kirill Molodtsov, a deputy energy minister who oversees the natural gas industry, used the meeting in Bangkok to reaffirm Russia’s goals.
“Sustained high growth will be seen in the Asia-Pacific region and it will become an attractive market. There will be state-ofthe-art technology for energy infrastructure,” he said. “But we all agree that we need to pay a lot of attention to improving energy efficiency and reducing the negative impacts from hydrocarbon fuel. We need to gradually phase out the share of oil and coal, even more so coal.
“We are extremely interested in the energy ring in Asia which would unite the regional grids ... of Russia, China, Japan, Mongolia, South Korea and Kazakhstan, in order to work toward more effective energy supply and smooth out peak and excess capacity over a 24-hour timeframe. We could see the project helping connect the capacity from small Russian hydroelectric dams with wind and solar farms in other countries.”
Asia Pacific, especially China and India, is forecast to account for 40% of the $68 trillion in global energy investment between now and 2040. Meanwhile, demand from mature economies such as the US, the European Union, Japan and South Korea will gradually flatten. Improved energy connectivity will help ease constraints in terms of investment cost.
More importantly, an increase in the share of renewable energy will help address the challenge of global warming. Asia-Pacific countries are especially vulnerable to climate change impacts, especially rising sea levels and natural disasters.
Fossil fuels — coal, oil and natural gas — still dominate total primary energy supply in this region, with no sign of diminishing. Escap figures show that coal usage almost tripled, from 1,067 million tons of oil equivalent (Mtoe) in 1990 to 2,939 Mtoe in 2014. The share of coal as a primary fuel grew from 31.9% to 43.4%, against a more modest rise in the global average, from 25.3% to 28.6%. Increases in other fossil fuels were relatively low by comparison.
“The energy solutions that have fuelled growth in the region over the past few decades are no longer compatible with the sustainable development aspirations of our nations and their people,” Shamshad Akhtar, an Escap under-secretary-general, said at the Bangkok meeting.
“In transitioning to a new era of sustainable energy, policymakers across the region face complex decisions. Supplies must be secure and affordable, and they must fill the energy access gap which leaves half a billion people across the region without access to electricity.”
Ms Akhtar singled out overdependence on coal as a major hurdle, accounting for as much as three quarters of electricity generation in some countries. “Unless the region’s countries work together to accelerate the incorporation of sustainable energy into their strategies, business-as-usual approaches will result in a continuation of fossil fuel use and associated impacts.”
The impact is already clear: 85 of the world’s 100 most polluted cities in 2014 were in Asia Pacific, according to the World Health Organization. The Asian Development Bank (ADB) last year estimated that if climate change continued unabated, GDP in the region could decrease as much as 3.3% in 2050, and 10% by 2100.
Given the high stakes, the committee that met in Bangkok aims to work on three goals: improving technology, regulation and policies to improve energy efficiency, doubling renewable energy use, and creating the Asia Energy Connectivity trans-boundary grid to share supplies and provide access to 400 million people who lack access to electricity.
“Asean, South Asia and Central Asia as well as China, Russia and Mongolia are already embracing cross-border energy connectivity,” said Ms Akhtar. “Initiatives such as Casa 1000 (Central Asia-South Asia) and the Asean Power Grid will allow low-carbon energy from gas, hydropower, solar and wind to be traded across borders.”
The $1.16-billion Casa 1000 now under construction will export surplus renewable energy from hydro dams in Tajikistan and Kyrgyzstan to Pakistan and Afghanistan. The Asean Power Grid is already exporting renewable energy from hydroelectric dams in Laos and Cambodia — Myanmar may one day be added — to energy-hungry Thailand, Malaysia and Singapore.
“We are extremely interested in the energy ring in Asia which would unite the regional grids ... of Russia, China, Japan, Mongolia, South Korea and Kazakhstan, in order to work toward more effective energy supply and smooth out peak and excess capacity” KIRILL MOLODTSOV Russian deputy energy minister