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Opinion

Southeast Asia energy policies on track to disaster

ASEAN leaders' climate change pledges are undeliverable empty promises

| Southeast Asia
Smoke billows from the coal-fired power plant owned by Indonesia Power in Suralaya in July 2020: crony capitalism and the powerful lobby are stifling efforts to develop renewable energy sources.   © Reuters

Hans W. Vriens is founder and managing partner of Vriens & Partners, a Singapore-based public policy and political risk consultancy.

Within 30 years, large parts of low-lying Southeast Asia will be underwater, leaving 200 million people homeless. This dire prediction is endorsed by many climate-change experts, including Sir David King, a former climate change adviser to the U.K. government.

With its numerous littoral states and archipelagoes, Southeast Asia is vulnerable to both rises in sea level and higher temperatures that will make it increasingly difficult for humans to live near the equator.

Claiming that disaster is avoidable, many leaders among the 10-member Association of Southeast Asian Nations have made bold commitments about lowering emissions in the run-up to the 26th U.N. Climate Change Conference of the Parties, or COP26, in Glasgow.

For example, Malaysia has promised a 45% cut by 2030, while Philippine President Rodrigo Duterte has pledged a 75% reduction. Unfortunately, these cost-free pledges are all a smoke screen. Not one Southeast Asian country has produced a realistic plan to realize any such commitments.

Substantially lowering emissions means transitioning from coal, oil and gas to clean renewables such as solar, wind, geothermal and hydroelectric power. Nowhere in Southeast Asia does such a plan exist. Worse, governments are doing the opposite of what they will promise in Glasgow. Southeast Asia is "transitioning" to even more coal.

The region's energy needs are expected to double by 2040. So will the number of coal-fired power plants. In 2040, just as in 2020, 43% of energy is expected to come from coal. Indonesia alone has 19 gigawatts of coal-fired power plants under construction -- one GW provides enough power for about one million households -- giving Indonesia 45% more power than it will actually need.

Indonesian politicians are trying to confuse the issue by talking about oxymoronic "green" coal. Calling coal green is like the tobacco industry calling low tar cigarettes healthy.

Southeast Asia may be one of the few global regions that is betting on coal instead of moving to renewable energies, but a greener approach is easily achievable. Blessed with clean energy, the sun shines powerfully everywhere, and Vietnam and the Philippines have more than enough offshore wind capacity to power the whole of Southeast Asia.

Thanks to its volcanoes, Indonesia has plentiful supplies of geothermal energy. Hydroelectric plants power the Malaysian state of Sarawak, which has an energy policy independent from the rest of the country.

But crony capitalism, and the exceptionally powerful coal lobby, are stifling efforts to develop renewable energy sources in countries such as Indonesia and Cambodia, where environmental campaign groups have repeatedly raised allegations of links between politicians and fossil fuel investments.

National state-owned energy companies are also keen to protect the coal industry, around which they have built their energy networks.

A far-reaching transition to renewables would mean completely redesigning and reconstructing electricity networks to adjust to the intermittent supply and storage demands of renewables. Fossil fuel power plants can be built close to cities, but big offshore wind projects require major investment to bring clean energy to urban settlements, requiring a re-imagining of everything to do with energy.

Vietnam seemed to have grasped all this, adding 16 GW of solar power generation capacity in the last decade, and setting ambitious targets for offshore and onshore wind capacity. All this made Hanoi the darling of the renewables industry in Southeast Asia. It looked as if Vietnam was going to be the first country in the region to build major offshore wind projects, with up to 8 GW possible before 2030 alone.

Offshore wind presents the single greatest opportunity in renewables for Vietnam -- and is perhaps the greatest renewable energy opportunity regionwide. The strategic policy framing is also in place, with the ruling Communist Party singling out offshore wind for special treatment as a strategic energy source and directing the government to develop supporting policies and regulations.

With numerous projects under development and strong political support, Vietnam is well placed to become a regional hub both for offshore wind power and the supply chains it requires. However, in an unexpected turn of events Vietnam has reemphasized coal-centric policies in the latest draft of its Power Development Plan Eight, published in September. This draft includes plans to build new coal-fired power plants providing 30 GW of additional generating capacity over the next 15 years while slashing renewable targets.

Power-generating windmill turbines in Bac Lieu province: Vietnam is well placed to become a regional hub both for offshore wind power and the supply chains it requires.   © Reuters

The government seems not to understand that this is so out of line with the environmental commitments of international and overseas financial institutions that it is unlikely to be realizable. For example, South Korea, Japan and China have all committed to stopping building and financing coal-fired power plants overseas.

As Vietnam will discover, if you cannot finance it, you cannot build it. If no alternatives are found, this could also put an end not only to Hanoi's plans for more coal-fired power generation but also to the equally dangerous ambitions of the Philippines and Indonesia.

That could help to slow the rush into a full-blown climate change crisis. It will do nothing, though, to deliver the essential investment in clean energy sources, without which -- and irrespective of ASEAN leaders' empty promises -- much of Southeast Asia will shortly begin sinking into the South China Sea.

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