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Asean's energy planners can learn from each other
Publication Date : 08-05-2014
Climate change is a global phenomenon with global causes. This means that Asean countries also have a responsibility to ensure that continued economic growth does not come at the expense of further deterioration in the environment. For some countries, this may involve difficult political decisions. And while each of the Asean member states faces a unique energy landscape, this does not mean that Southeast Asian countries cannot learn from each other.
The Asean member states collectively registered a robust economic growth rate of five per cent in 2013, compared to the global average of just three per cent. Combined with their relatively high population growth rates, the result is surging energy demand.
The 2013 Southeast Asia Energy Outlook report produced by the Paris-based International Energy Agency (IEA) projects that Asean's energy needs will increase by 83 per cent between now and 2035. Demand will be met predominantly by fossil fuels, namely, coal, oil and natural gas. Naturally, this raises concerns about whether Asean is doing enough to minimise the accompanying pollutants.
In terms of power generation, the poorer countries, such as Myanmar and Cambodia (where more than 50 per cent of the population still lacks access to electricity) must make particularly hard decisions. These include decisions about the allocation of limited treasury funds and the need to provide the most affordable means of electricity generation to the poor. In earlier decades, several Asean countries adopted energy subsidy arrangements to minimise energy costs for the poor. Today, however, these subsidies are often criticised as being inefficient and working at cross purposes with energy conservation efforts.
Singapore faces a different set of challenges. Due to a lack of renewable energy sources, it is almost completely dependent on energy imports to sustain its power generation capacity. In addition, the large refining and petrochemical sector which constitutes about a third of the country's manufacturing output uses fossil fuel as its feedstock.
Nevertheless, Singapore has incorporated energy efficiency and conservation practices wherever possible. For example, it has shifted from using heavy fuel oil to much cleaner natural gas for electricity generation. The combined-cycle gas turbine (CCGT) power plants that run mainly on natural gas are also more efficient than steam power plants that run on heavy fuel oil.
Besides adequate power, a modern economy also needs an efficient public transport sector. A well-developed transport infrastructure can increase mobility whilst minimising congestion and pollution. For example, Singapore continues to invest heavily in its Mass Rapid Transit (MRT). The rail network will be doubled by 2030.
Expansion and modernisation of the urban transport systems in Asean's large cities, such as Bangkok, Jakarta and Manila is crucial. With financial assistance from the Japan International Cooperation Agency, Yangon is planning to set up a bus rapid transit (BRT) system and upgrade its problematic circular rail service. Phnom Penh recently started to introduce bus services, and is currently working with the Asian Development Bank (ADB) to improve its dilapidated railway system.
Another area that bodes well for energy efficiency in Asean is the growing prominence of energy service companies (ESCOs). They provide energy solutions, including the design, funding and implementation of electricity supplies or other energy sources. In addition to helping industries and the public sector save energy, the ESCOs, in conjunction with international financing organisations such as the World Bank, support electrification projects.
In Laos, ESCOs and local authorities, working with the World Bank and Global Environment Facility (GEF), have helped introduce small hydro-electric and solar powered systems to rural communities.
To help resolve Southeast Asia's complex energy issues, regional studies conducted by academic experts and policy-makers serve as collaborating platforms where regular discussions are held among specialists from each of the Asean member states.
The results of these discussions need to be taken seriously by governments. Currently, political pressures and hurried agendas sometimes reduce the willingness of officials to be transparent about their energy needs.
The Economic Research Institute for Asean and East Asia (ERIA) hosts thrice yearly meetings to discuss, improve and harmonise energy outlooks. Each of the participating countries uses the same energy modelling software. By developing a common methodology for forecasting energy supply and demand, such efforts can help place governments on equal analytical terms, allowing them to compare future energy needs and give policy feedback to one another.
In an age where knowledge is shared globally, international energy organisations are keen for all countries to meet and share their energy planning experiences. Asean's energy planners should become closely involved with these and avail themselves of every possible opportunity to learn from the successes and failures of others.
While it is true that Asean countries are at different stages of economic development and modernisation, by carefully studying the energy strategies of a wide range of developed and developing countries, the region's energy planners can surely develop appropriate long-term energy plans that suit the needs of each country.
*The writers are Energy Analysts at the Energy Studies Institute, National University of Singapore. Both are working group participants in ERIA's Energy Outlook study.