Investment, Innovation and Integration are Key Pillars to Realise the Energy Transformation in ASEAN
ASEAN is working towards achieving energy security, accessibility, affordability and sustainability through investment, innovation and integration. While the adoption of renewable energy is increasing, natural gas will play a key role in enhancing the region’s energy security at an affordable price. By Zheng Hui Jian
Today, fossil fuels supply most of the region’s energy mix. ASEAN has set itself two aspirational targets – first, to increase renewables in its total energy mix, and second, to reduce energy intensity.
ASEAN needs to invest, innovate, and integrate to solve the energy trilemma. While renewables energy is increasing, natural gas will play a key role as transitional fuel, especially in Singapore, as 95 percent of its electricity is generated using natural gas.
Investment
As one of the key financial centres of the world, Singapore offers collaborative platforms for energy infrastructure developers, financial institutions, and investors to co-create innovative financing solutions for the region. This also helps Singapore in its aspiration to be an LNG hub in Asia. Dr. Koh Poh Koon, Singapore’s Senior Minister of State for Trade and Industry highlighted that Infrastructure Asia was set up by Singapore to facilitate project financing including energy projects in Asia. Beyond ASEAN, countries like China can also provide financial muscle for financing energy projects. As countries invest in projects, affordability for consumers remains key in energy projects. Singapore is committed to generate 1 GW peak of renewable energy by 2020 and beyond. Malaysia and Philippines also aim to diversify energy mix. For Malaysia, it aims to increase renewable energy from two to 20 percent through investments such as installing solar panels on the rooftops of residential homes.
Innovation
Harnessing new technologies and implementing innovative measures are instrumental in transforming the energy sector. H.E. Yeo Bee Yin, Malaysia’s Minister of Energy, Science, Technology, Environment and Climate Change said that Malaysia is implementing market structure reform in the electricity sector. It will also implement an Energy Efficiency Act to enhance energy efficiency. H.E. Alfonso Cusi, Philippines’s Secretary of Energy also highlighted that Philippines is also implementing a green energy framework to encourage renewable energy adoption. China, which has experience in renewables, can also provide ASEAN with know-how of such new technologies.
Datuk Iain Lo, Shell Vice President of Commercial and New Business Development, Asia Integrated Gas and New Energies, highlighted that it aims to reduce carbon footprint by 50 percent by 2050. This could be achieved by carbon sequestration to reduce CO2. Biofuels like biodiesel and bioethanol also helps to reduce carbon footprint.
Integration
Enhancing regional energy connectivity and integration will also help build resilience. For example, Malaysia plans to mitigate intermittency of solar power by having grid interconnection with Sumatra, Indonesia. Regional energy collaboration can also help to attract investment in the ASEAN region.
As ASEAN strives to resolve its energy trilemma, it is imperative for energy leaders to invest in, innovate and integrate new energy solutions.