A key milestone was recently taken by Indonesia, the world’s fourth largest coal producer, which announced the shutdown of new coal-fired power plants from 2023. This announcement is an encouraging sign that sustainable development and growth are underway. underway within the Association of Southeast Asian Nations (ASEAN), and that countries should collectively build on the momentum to drive the low-carbon transition sooner.
From conference rooms to courtrooms around the world, we have witnessed an increased pace along the path to sustainability. ASEAN can accelerate its transition to a sustainable global economy through a combination of positive policies, mechanisms and stakeholder responses that include net zero goals, carbon markets, smart urbanization, sustainable finance and optimization of resources.
ASEAN Status on Carbon Neutrality
According to a International Energy Agency report (IEA), energy demand in Southeast Asia will increase by 60% over the next two decades. The electricity sector will be responsible for just under half of the region’s carbon dioxide emissions in 2040, up from 42% in 2019.
Climate change is a major concern for ASEAN, as the The Philippines, Myanmar and Vietnam are ranked in the top 10 worldwide in terms of the degree of impact of climate change. In many ASEAN countries, rising sea levels pose a worrying threat to low-lying coastal towns, and extensive agricultural land is threatened with flooding.
To propel the growth trajectory of green efforts, ASEAN should commit to net zero and carbon neutrality goals earlier. As carbon neutrality has an effect on reducing risks and improving the competitiveness of companies, this will increase the attractiveness for foreign direct investment and promote the growth of green finance.
While appropriate targets and mechanisms need to be defined, the path to carbon neutrality will require the efforts of a range of stakeholders – governments, businesses and the community.
Harnessing solar energy
An immediate rapid gain from the energy transition is harnessing solar energy from an abundance of resources in the region. ASEAN governments have prioritized solar energy as an alternative fuel to replace fossil fuels in recent energy development plans. In particular, rooftop solar and other distributed energy resources have the merit of providing energy resilience in the community, limiting energy transmission losses and overcoming the broader challenge of integrating more renewable energy to support the path to carbon neutrality.
Rooftop solar power is cost competitive to meet demand concentrated in ASEAN cities and industrial parks, as well as demand in remote areas. Adequate regulatory policies and incentives, including net metering, will be needed to encourage sourcing from pro-environmental producers and consumers to scale up rooftop solar panel deployment, and potentially promote behavioral changes to save energy. energy, thus reinjecting excess energy into the network.
To further optimize the integration of renewables, governments should encourage investment in other supporting energy solutions, such as utility-scale or behind-the-meter energy storage.
Importance of carbon markets
Navigating the carbon neutral path will require ASEAN to develop a concerted carbon market, starting with the implementation of carbon taxes and mechanisms to support a net zero path.
In ASEAN, the carbon market is still in its infancy, with only Singapore having implemented an economy-wide carbon tax. Vietnam recently adopted the Revised Law on Environmental Protection which will legalize an emissions trading system, taking effect on January 1, 2022. Other ASEAN countries are also moving in the same direction – Thailand plans to set up a carbon market, and Indonesia has developed proposals for implementation of the carbon tax.
In Europe, carbon prices have more than doubled a year ago as carbon emissions regulations continue to tighten. By taking this as a benchmark for ASEAN, increased pressure on companies to make green commitments and transparency in reporting can further ensure the efficiency of the carbon market.
Smarter cities play a vital role
As ASEAN urbanizes, governments should implement the concept of developing smart cities to maximize results – limiting the carbon footprint through efficient use of resources. Sustainability has become a key element of urbanization and master plans for major cities in ASEAN, integrating features such as green spaces, renewable energy, smart energy management and district cooling.
For example, Thailand’s smart city master plan aims to tackle the high cost of energy by moving towards integrating renewable energy into supply, while implementing reduction and reuse policies. waste, as well as by deploying other smart solutions such as smart grids, district cooling systems and promoting cogeneration facilities.
Countries are also expected to adopt smart technologies such as the Internet of Things, mobile devices, artificial intelligence and sensors that can increase the efficiency and effectiveness of solving everyday problems such as traffic management and monitoring carbon emissions. ASEAN countries can mitigate environmental risks by deploying such technologies to capture and analyze data in real time, while simulating scenarios to optimize solutions.
With the creation of the ASEAN smart cities network in 2018, 26 smart pilot cities were identified, with the aim of improving the overall quality of life through smart and sustainable urban development made possible by technology.
Since then, the major ASEAN countries have drawn up ambitious development plans: Thailand is targeting 100 smart cities by 2024; and Indonesia is targeting 100 smart cities in its master plan. These encouraging trends for smart cities are expected to continue to expand and embrace sustainability as ASEAN strives to accelerate its economic growth.
The question of funding
According to the Asian Development Bank, for Asia to maintain its growth momentum and eradicate poverty while responding to climate change, the Region to invest US $ 1.7 trillion per year in infrastructure until 2030. However, only around 2% (US $ 40 billion) is expected to be allocated to climate risk adaptation. As Covid-19 puts additional pressure on public finances, there are opportunities for public-private partnerships and private investments to drive sustainable development projects.
An encouraging sign is the increase in corporate power purchase agreements (PPAs) for renewable energy in ASEAN. In Singapore, Sunseap Group has signed PPAs with tech giants such as Facebook and Amazon, to provide 100% renewable energy to power operations in that region.
Non-ASEAN electricity players have also entered the ASEAN market to meet the growing demand for renewable energy. Japanese renewable energy startup Shizen Energy, in partnership with Constant Energy, has signed corporate PPAs with Japanese companies operating in Southeast Asia, for example.
As more companies commit to achieving sustainability and net zero goals, corporate PPAs and renewable energy investments will continue to grow, which is critical to meeting future neutrality commitments. carbon for ASEAN countries.
Notably, a collective initiative of global organizations such as RE100 encourages more commitments to 100% renewable energy and the incorporation of low-carbon solutions into supply and value chains. Given the scope 3 emissions reduction requirements, which are all indirect emissions in a company’s value chain, these suppliers will be required to comply and transition to carbon neutrality.
Reduce Reuse and Recycle
Finally, the involvement of local communities to engage in “Reduce, Reuse and Recycle” activities is essential. The behavior of consumers towards the efficient use of resources and the use of energy efficient technologies can be cultivated. This is seen in a multitude of ASEAN programs that encourage the replacement of old electrical appliances and equipment that are not energy efficient.
The culture of reusable packaging has also been promoted in Singapore and Malaysia in recent years and discouraging the use of single-use plastics will help reduce the carbon footprint and ease the burden of waste management.
Recycling remains a challenge in ASEAN, as municipal waste collection and management remains the main concern of waste-to-energy projects, but this will likely improve as more awareness and education efforts are made. of the public will be deployed.
The road to carbon neutrality is one that requires immediate efforts from a multitude of actors using a wide range of solutions. An ASEAN carbon neutral path presents many opportunities for governments, businesses and consumers to make strategic choices that will ensure economic relevance in the years to come, as the changing tides of a greener world become. inevitable.
The views and opinions expressed in this article are those of the author and do not necessarily reflect those of pv magazine.
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