Clean energy giving Asia’s population a clean boost

Decentralisation and renewable energy are major opportunities for Asia especially when it comes to access, sustainability and cost effectiveness.
Published: Wed 03 Aug 2016

Energy demand is projected to almost double in the Asia and Pacific region by 2030 so there is an urgent need for innovative ways to generate power in a socially, economically and environmentally sustainable manner. Compounding the problem is widespread energy poverty across Asia, with millions still without access to electricity, according to the Asian Development Bank.

In recognition of this, many utilities across the region are turning to renewable energy development, whether it be small or large scale projects.

Sharing renewable resources

One such utility is Da Afghanistan Breshna Sherkat (DABS) which looks to benefit from the $1.17 billion CASA 1000, a project involving the sharing of hydropower generated by The Kyrgyz Republic and Tajikistan. These two countries are endowed with some of the world’s most abundant clean hydropower resources with water cascading from the mountain ranges and filling the rivers every summer. Both of these countries have a surplus of electricity during the summer and this power will be shared with Afghanistan and Pakistan, both of which suffer from chronic electricity shortages. The new electricity transmission system to connect all four countries will help make the most efficient use of the clean hydropower. Mirwais Alami, Chief Commercial Officer at DABS updated us on the mammoth project at the Asian Utility Week. He said that it will change lives in Afghanistan especially when it comes to education, health and general social well-being. To cater for smaller and widespread communities, Alami says that there are also plans to develop mini-grids using the country’s rich renewable resources.

Recognising economic value

Other than its environmental friendliness and sustainability value, renewable energy is quickly becoming recognised as providing great economic value.

Malaysia’s Murum hydropower project  is providing locals with an energy supply at a price that is the "lowest in Malaysia and among the lowest in Southeast Asia". In a studio interview, Chen Shiun, General Manager, Research & Development, Sarawak Energy briefs us on the project progress and the opportunities it has opened up in the Sarawak Region.

The project (and others) is being driven by the industrialisation of the state which has a strategy in place called the ‘Sarawak corridor of renewable energy’. The aim of this strategy is to attract large manufacturers by providing them with competitive electricity tariffs. Shiun says that some residential bills have dropped by 40% as a result of Murum. Murum is also providing employment and it is creating an additional revenue stream thanks to hydropower exports to Indonesia.

When it comes to the challenge of displacement, Shiun says that it is important to show the local communities that the project has greater positive implications for everyone involved. Sarawak Energy has put into place plans which will help these displaced communities develop socially and economically.

Over and above large projects, the country is also planning micro-hydro and solar for remote areas.

Microgrids and facing disruption

Peter Lilienthal, CEO, Homer Energy got us up to speed on microgrids across Asia on grid and off grid during the studio interview. The main drivers for microgrids were outlined by him: access especially on remote islands, cost effectiveness and sustainability of renewables, and reliability especially in an emergency situation,

However, there still seems to be a lack of understanding in Asia when it comes to the microgrid, says Lilienthal. He explains: ” Until people understand the opportunities and regulatory issues, microgrids won’t really take off the way they should.”

While energy efficiency and renewables are looked upon as disruptors and business threats, Lilienthal says that utilities should rather embrace the microgrid by learning more about it and eliminating misconceptions. “Microgrids can actually help utilities when it comes to providing energy to those without access to the grid.”

He adds: “Community involvement is extremely important otherwise microgrid pilots/projects will not be viewed as viable. These need a support structure.”

The move to renewables and decentralisation

Csilla Kohalmi-Monfils, EVP Strategy and New Business, ENGIE Asia Pacific  told us how the utility intends to push towards decentralisation, digitisation and renewables.

“The industry is driving the need to change. The energy transition has already happened in Europe and will make its way to Asia.” She adds: “This presents huge opportunities for Asia as they leapfrog some of these changes that Europe and US have already experienced.”

The utility has a very ambitious renewables target of 50% in 20 years. While large complex projects are their speciality, Kohalmi-Monfils says that they now need to become more agile and cater for the smaller projects as customers are calling for a move to more decentralised power systems.    

Unfortunately, Asia’s legislation seems to be standing in the way of this transformation process. Kohalmi-Monfils says that there is “a lot of red tape”  when it comes to renewables and decentralisation. “Government needs to be more project/investment-centric instead of regulatory centric.”

Despite these challenges, she explains that utilities should partner with innovative startups and create new business models in order to be a part of the clean energy transformation in Asia.

Further Reading

Asian Development Bank-Energy Issues in Asia and the Pacific