Long-term renewable energy policies accelerate in Asean as a result of Iran war: report
Six member states have unveiled 37 renewable energy and electrification policies since the outbreak of the war
[SINGAPORE] With the Iran war causing energy prices to spike across most of South-east Asia, governments in this region are accelerating the roll-out of renewable energy policies, according to report by Zero Carbon Analytics, a research group focused on energy transition.
The report, released on Friday (Sep 25), noted that six major Asean economies – Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam – have introduced a total of 37 renewable energy and electrification policies since the start of the Iran war, compared with 29 fossil fuel policies.
Including five biofuel and new nuclear policies, the region unveiled a total of 73 energy policies between Feb 28 and Aug 31 this year.
The report said 65 per cent of the 37 renewable energy and electrification policies were focused on long-term change and had implementation windows of more than three years, compared to 21 per cent of the 29 fossil fuel policies.
“There were four times as many long-term renewable energy and electrification policies as fossil fuel policies, at 24 versus six. This suggests that renewables and electrification are seen as long-term solutions for future energy systems, while fossil fuel policies are primarily focused on temporary relief.”
In the six countries, a majority of the policies (18) were focused on expanding solar capacity, with a particular focus on distributed renewable energy systems like rooftop solar, with several countries releasing policies to lower costs.
This includes the Philippines adding at least 250 megawatts of solar capacity to its grid, Indonesia committing to install 100 gigawatts of solar over the next three years, and Singapore raising its solar deployment target to 3 gigawatt-peak by 2030.
Thailand and Vietnam increased quotas for residential rooftop solar users to sell solar power to the grid, with Thailand raising its quota to 500 MW, and Vietnam allowing residents to sell up to half their solar output to the grid.
Expanding energy storage systems to support renewable power made up the second-most number of renewable energy and electrification policies, at seven.
Examples of such policies include the Philippines requiring developers of new renewable energy projects to integrate energy storage systems in their plants, and Vietnam commissioning its first large-scale, grid-connected battery and energy storage system in the capital.
Amid rising fuel prices, six policies looked into boosting adoption of electric vehicles.
The Philippines’ national energy emergency directive includes measures to expand the adoption of EVs in mass transport; Thailand introduced a 400 billion baht (US$11.9 billion) emergency loan, which includes the financing of longer-term transition measures, including the expansion of EVs and charging stations.
Fossil fuel policies introduced in the six months after the outbreak of the Iran war were mainly focused on securing emergency fuel and managing price increases.
For example, Indonesia said it would reallocate 130 trillion rupiah (US$7.2 billion) towards energy subsidies, and started planning a long-term deal to import Russian crude oil in August.
In March, the Philippines set up a 20 billion Philippine peso (US$320 million) emergency fund to procure up to 2 million barrels of fuel to boost its domestic supply. In July, it followed that up with the setting up of its first government-managed petroleum reserve facility.
Thailand ordered the restarting of two decommissioned coal-fired power plants.
Nevertheless, the report said that its findings indicate that Asean governments are looking to renewables and electrification as the long-term solution to fossil fuel-related power crises.
“Faced with one of the most volatile oil market episodes in two decades, there is short-term pressure for emergency relief and to increase fuel reserves. Despite this, renewables are increasingly being seen as the solution for resilient future energy systems,” it read.
Besides future renewable energy build-out, the report highlighted that grid modernisation will be key to ensuring that transmission and distribution infrastructure in domestic and cross-border systems can efficiently and flexibly absorb the growing capacity for renewables.
