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Renewable Energy Challenges In Southeast Asia

The international organization ASEAN has set an ambitious target of securing 23 percent of its primary energy from renewable sources by 2025. According to the International Renewable Energy Agency (IRENA), this objective entails a two-and-a-half-fold increase in the modern renewable energy share compared to 2014.
A Southeast Asia Energy Outlook report states that through this, local manufacturing industries will also be able to grow. For example, Malaysia is already the world’s third-largest producer of photovoltaic cells, while investment in Thailand’s solar manufacturing industry is increasing PV output for global markets. By deploying more renewable energy in the region, the economies of these ASEAN member states can be further strengthened.

Rising energy needs and changing supply-demand dynamics are creating new and tough challenges for Southeast Asia’s policy-makers. Despite existing opportunities created by appropriate policies, some challenges require a region-wide approach.
Many of Asia Pacific’s LNG facilities are located in remote areas, far from the power grid. As a result, feed gas is used to generate electricity to run the plant and fuel the liquefaction process. Typically, 8% to 12% of feed gas is consumed at the plant to run these processes. Older, more inefficient plants, as well as nascent floating LNG (FLNG) vessels operate with far higher losses.

The development of renewable energy projects in the region is an expensive bill for most Southeast Asian countries to foot. In a brief published by Indonesian non-governmental organisation (NGO), the Habibie Centre, financial access was deemed the most important factor for developing renewable energy projects due to their capital-intensive nature. Currently there is a lack of experience and expertise in some ASEAN member states in evaluating the risks of renewable energy investment.

The lack of regulatory framework is also a major hurdle when it comes to the introduction and development of renewable energy projects.
A lack of coordination amongst government agencies and the private sector as is the case in Lao PDR is another factor which effectively hinders the implementation of the country’s renewable energy priorities and policies.

Lastly, the lack of awareness and public support also contributes to the challenges faced by ASEAN member states when it comes to developing the renewable energy sector in the region. The minimum use of renewable energy technologies is particularly evident amongst land and building owners and industrial players. This could be due to a lack of awareness about the potential benefits of renewable energy towards environment conservation for a cleaner and greener future.
As such, immediate collaboration between the public and private sector is necessary to bridge and meet the challenges at hand.

By Domenico Greco

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