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Enabling Policies Can Unlock Renewable Energy Investments in ASEAN, IRENA Outlines

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In a presentation to Energy Ministers from the Association of Southeast Asian Nations (ASEAN) today, Mr. Adnan Z. Amin, the Director-General of the International Renewable Energy Agency (IRENA) reinforced the Agency’s support for the region’s aspirational target of 23 per cent renewables in total primary energy supply by 2025. It represents a firm commitment from Southeast Asian governments to an energy transformation based on renewables.

During the 36th Asian Ministers of Energy Meeting (AMEM) in Singapore, the Director-General outlined that the case for the rapid scale-up of renewable energy across the region is compelling, driven by strong political commitment, vast resource potential and an attractive business case.

“Private investment is central to the future of energy transformation in ASEAN & around the world. @IRENA stands ready to support regional policy makers develop & implement the risk mitigation instruments necessary to attracting investment capital.” IRENA DG @adnanzamin #SIEW2018 pic.twitter.com/X6uJajYxVB

— IRENA (@IRENA) October 29, 2018

Mr. Amin pointed out that meeting the goal of 23 per cent renewables would require an additional USD 27 billion of annual investment for the next eight years and the share of renewables would need to increase two-and-a-half fold by 2025. However, these additional investments would need to come largely from private sector capital, the Director-General said. Policy makers have a central role to play in creating the policy environment that unlocks these investments.

Technological innovation, falling costs, enabling frameworks and the imperative to meet climate objectives are fuelling global energy transformation and creating new opportunities for development and long-term prosperity, the Director-General went on to underline, highlighting that ASEAN holds a key role in this future.

ASEAN Chair and Singapore Minister of Trade & Industry, Mr. Chan Chun Sing referred to the region’s challenge in terms of the ‘energy trilemma’, with Southeast Asian countries seeking to balance energy affordability, sustainability and reliability. Mr. Sing pointed out that ASEAN recognises regional growth can no longer come at the expense of its people or the environment. This requires the governments to identify a path that offers the region’s half a billion energy consumers access to low-cost, reliable, clean energy.

Brunei’s Minister of Energy and Industry, H.E. Dr. Awang Haji Mat Suny bin Haji Mohammed Hussein, took the floor, moving the discussion on to issues of utility-scale storage. He outlined that his country is ready to work with IRENA to understand the immediate future for battery costs, noting that solar energy combined with battery storage will be a “game changer” in terms of meeting ASEAN’s clean energy needs, but that solutions are needed to “increase its feasibility”.

AMEM meeting Singapore

Malaysia Minister of Energy and Climate Change H.E. Yeo Bee Yin, underlined that renewables in the energy mix will grow to around 20 per cent by 2025, excluding large hydro, under current government plans. Bringing more renewables online will “stablise power pricing” in the country and reduce the system’s vulnerability to fluctuations in the price of fossil fuels. The Minister also highlighted that Malaysia is looking to its rooftops for renewable energy growth.

Progress was reported too in Myanmar and the Philippines where ministers outlined the fact that renewables are tackling challenging energy access issues and lowering electricity costs for rural communities. Secretary of Energy in the Philippines, H.E. Alfonso Cusi said his archipelago nation of more than 7000 islands has turned to microgrid renewable energy systems with battery storage. The result has been a reduction in diesel imports and lower electricity costs for consumers.

Signalling a strengthening relationship with ASEAN, the Director-General said he was pleased that IRENA and ASEAN will sign a Memorandum of Understanding on working together to facilitate the scale up of renewable energy in the region. IRENA will engage with the region in five “priorities areas of cooperation:” including energy planning, development of regional renewable roadmaps, policy and regulatory frameworks to support deployment, capacity building technology and financing.