Energy Transition in Asia Pacific Still in its Infancy: Report
The energy transition in the Asia Pacific region is still in its infancy stage, as revealed by the Asia Pacific Energy Transition Readiness Index of Siemens Energy.
April 11, 2022. By Manu Tayal
Regional and global business leaders, policy makers and government representatives throughout the energy sector convened at the second annual Asia Pacific Energy Week, organized by Siemens Energy, to discuss regional challenges and opportunities for the energy transition on the theme 'Making the Energy of Tomorrow Possible'.
Over the two-days virtual event, participants were surveyed on the importance of major energy priorities and the progress made towards the energy transition.
The Readiness Index has been derived using an aggregate of participants’ responses to each of 11 pre-determined key energy priorities. The study yielded valuable data and insights, which will be used to enhance key strategies for the energy transition in the region. It is the first of a series of studies, which will be conducted in different regions globally.
As per the company’s survey of conference participants, a significant gap between perception and reality when it came to carbon emissions.
The company said that between 2005 and 2020, regional carbon emissions grew by around 50 percent, yet participants believed that they had fallen by almost a third.
The participants also anticipated that 2030 emission levels would be 39 percent lower than in 2005.
Further analysis of the survey data found that the Asia-Pacific region had a score of 25 percent on the Readiness Index, which indicates that how far a region is along its energy transition path.
Commenting on the development, Christian Bruch, President and CEO of Siemens Energy AG, said “while we have seen successful decarbonization in a number of areas, strong economic growth is counteracting this progress, resulting in a net increase in overall emissions. With the Asia Pacific region responsible for more than half of the world’s CO2 emissions, global climate efforts must clearly involve Asia Pacific more in the future.”
Bruch further added that “maintaining economic growth and prosperity while simultaneously reducing emissions in the medium and long term needs to be the top priority for the region.”
The global management consultancy Roland Berger also identified in close collaboration with Siemens Energy 11 priorities for tackling climate change and ultimately achieving net-zero.
While participants agreed unanimously that each of the energy priorities have an important role to play in the region, the accelerated expansion of renewables and the decarbonization of industry were considered the most important factors, the report added.
The most progress was reported in power generation, with more than 80 per cent of participants saying that the acceleration of renewables is at least in the planning phase, with around a third already at implementation. Almost two-thirds of respondents reported a similar level of progress for coal exit strategies.
However, 5 factors were identified as areas that require development to drive progress along with the energy transition i.e. funding, know-how, technology, policy, and supply chain.
Moreover, overall participants see the policy as the most important factor in almost every priority. Funding also emerged as a substantial need for most priorities. The need for additional know-how varies but is highest for new technologies such as carbon capture and storage (CCS) and power-to-X solutions, said the report.
On meeting the carbon reduction targets, Denis Depoux, Global Managing Director, Roland Berger, said, “to meet carbon reduction targets, businesses in Asia Pacific region will need to reduce their reliance on coal as an energy source and increasingly turn to renewables.”
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