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The Diplomat
21-07-2025
- Business
- The Diplomat
What's Holding Back ASEAN on Renewable Energy?
The region's leaders must demonstrate the political will necessary to align national interests with a collective, climate-resilient future. 'We're baking bread in a dirty oven inside an enclosed room,' reflected Finian Lim, who leads public affairs at Trinasolar Asia Pacific. The main ingredients for solar energy – technology and capital – are already in place, he said. But in the absence of the right policy conditions, we might suffocate before we get to eat. Lim's metaphor, shared this week during a PRCA Asia Pacific webinar on ASEAN's energy transition, captures the challenge the region now faces. Southeast Asia stands at an important point in its energy transition. Electricity demand across the ASEAN bloc is projected to grow by 30 percent by 2030, fueled by expanding urban populations, rising incomes, and increased digitalization. Across ASEAN, governments are already demonstrating that rapid clean energy deployment is possible under promising conditions. Take Vietnam, which in 2020 became the third-largest solar market in the world, installing more than 17GW of capacity, far surpassing its 2025 targets. The growth was based on government subsidies, supplemented by a coherent feed-in tariff policy, clear timelines, and an open posture toward private capital. Indonesia and Vietnam have struck multibillion-dollar Just Energy Transition Partnerships (JETPs) with G-7 nations and multilateral lenders. These frameworks aim to accelerate coal phaseout and unlock renewable projects through concessional financing and capacity-building. Even Singapore, constrained in terms of land and natural resources, has positioned itself as a green finance and technology hub, introducing regional taxonomies – official definitions of what economic activities are 'green' or sustainable – and disclosure frameworks, to attract and direct both Singaporean and foreign funds into regional climate-aligned investments across ASEAN. In 2023, the region attracted just $32 to $40 billion in clean energy investment, far below the funds required (estimated at between $150 to $200 billion annually). Singapore's growing role in catalyzing international investments for ASEAN's energy ecosystem may help narrow this gap. On the technology front, the tools needed to decarbonize are no longer speculative. Smart microgrids – combining solar generation, battery storage, and digital control systems – are already being deployed in off-grid communities across Indonesia and Malaysia. In parallel, Singapore-founded digital services firm Temus has co-developed an environmental intelligence platform that integrates AI, sensors, and data to enhance visibility into carbon stocks, biodiversity, and land use. These digital platforms are helping to monetize natural capital and support more sustainable investment decisions in resource-rich geographies like Indonesia. AI-enabled energy management systems (EMS) are also increasingly critical for optimizing grid operations, allowing real-time balancing of supply and demand. Without such dynamic optimization, ASEAN could face systemic disruptions, similar to the brown-outs in Spain during its 2021 solar surge or California's rolling blackouts in 2020, where mismatches between generation and demand overwhelmed grid stability. Thailand's Provincial Electricity Authority, for example, has deployed EMS pilots that reportedly reduced peak loads by as much as 8 percent. Meanwhile, modular solar and battery energy storage systems are proving their viability in archipelagic states. In the Maldives, an Asian Development Bank-backed project has delivered solar and storage systems across more than 160 islands, slashing diesel dependency and saving millions annually in fuel costs. On top of being proven and commercially viable, the cost of solar PV and battery storage has dropped by more than 80 percent and 70 percent, respectively, over the past decade. What's now required is the policy infrastructure to scale their deployment across the region. In 2022, Singapore began importing renewable energy through the Lao PDR-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP), marking the first time clean electricity generated in Laos was transmitted across three borders and consumed in Singapore. Technically, LTMS-PIP worked. But the underlying policy architecture has not kept pace. ASEAN still lacks harmonized rules for renewable energy certificates, emissions factors, and carbon accounting. Without regulatory coherence, electricity may flow, but markets won't move. For instance, the ASEAN Power Grid was first conceived and formally articulated in 1997 to integrate national grids into a single regional network, enabling large-scale cross-border renewable trade. But progress has been uneven, hindered by slow policy alignment and fragmented bilateral arrangements. At its core, ASEAN's institutional model, which is built on consensus decision-making, makes regulatory convergence a slow and complex process. To fill the gap, some nations have turned to 'minilateralism': smaller, interest-aligned groupings aimed at specific challenges. LTMS-PIP is a prime example. This was not launched under ASEAN's formal architecture; it was a bilateral deal (Singapore-Malaysia) with Thailand and Laos serving as transit points, which worked because it was pragmatic and narrowly scoped. That said, even promising approaches like minilateralism have their limits. Geopolitical divisions within the region continue to complicate the broader multilateral cooperation needed to scale and replicate these solutions across ASEAN. Longstanding disputes, from Mekong River water-sharing issues to overlapping claims in the South China Sea , risk eroding trust and slowing cross-border infrastructure alignment. Domestic obstacles remain just as pressing. Many ASEAN countries still operate with outdated grid infrastructure, ill-equipped to absorb the variability of solar and wind power at scale. More than 3.4 million households across the region remain without access to electricity, and clean cooking solutions elude nearly 167 million people, according to the International Energy Agency. In addition to requiring technology and financing alone, energy transitions also require broad-based legitimacy. This is where public affairs plays a critical role. As Lim put it during last week's conference, ASEAN's clean energy future will depend on 'connectors, navigators, and advocates.' Solar energy, for example, gains legitimacy not just when it delivers power, but when citizens understand how it lowers long-term energy costs, reduces emissions, and supports local employment. A successful green transition in ASEAN could add up to $5.3 trillion to the region's collective economy and create up to 66 million new jobs by 2050, according to the World Economic Forum. The tools for this transition exist. But to unlock these gains, ASEAN leaders must demonstrate the political will necessary to align national interests with a collective, climate-resilient future.
National Observer
08-05-2025
- Business
- National Observer
Who will finance global climate solutions? Not the West.
This story was originally published by Grist and appears here as part of the Climate Desk collaboration International climate action has long rested on the consequential distinction between the Global North and the Global South. Wealthier, earlier-to-industrialize nations contributed the most to a warming planet while developing countries bear the brunt of the climate crisis. As a result, developed countries have been called on to help developing nations reduce their carbon emissions and adapt to climate change by providing financial assistance, technology, and other resources. This essential premise has been embedded in various climate agreements signed since the 1990s, including the most recent pact inked at the 29th Conference of Parties, or COP29, in Baku, Azerbaijan, late last year. There, wealthy countries agreed to provide $300 billion per year to developing nations by 2035. Wealthy countries, however, have frequently failed to live up to their promises, slowly eroding the Global South's trust in a multilateral approach to the climate crisis. Over the last three months, the Trump administration has only accelerated that process. First, President Donald Trump withdrew the United States from the Paris Agreement, the 2015 climate treaty to keep global warming to less than 1.5 degrees Celsius. Then, Trump cut funding for various international climate programs, including the Just Energy Transition Partnerships and other initiatives supported by the US Agency for International Development. And most recently, Treasury Secretary Scott Bessent criticized the World Bank and International Monetary Fund, or IMF, prominent financial institutions that have made climate a priority in recent years, for straying from their mission. 'The IMF was once unwavering in its mission of promoting global monetary cooperation and financial stability,' Bessent said last week. 'Now it devotes disproportionate time and resources to work on climate change, gender, and social issues.' These changes in the US's stance are taking place at a time when the European Union is also slashing its development funding, which includes climate aid. Countries including the United Kingdom, Switzerland, Germany, France, and the Netherlands have cut as much as 37 percent of their aid budgets, moving the money instead to defense and stimulus measures. According to one analysis, the aid cuts add up to nearly $40 billion. While it's unclear exactly how much total climate aid will be lost as a result of these changes, the figure is a substantial portion of international climate finance. The US alone provided $11 billion last year — 8 percent of global climate aid. Much of that has already been lost this year through cuts to the US Agency for International Development and the Green Climate Fund. 'We are at a very uniquely devastating moment,' said Harjeet Singh, founder of the Satat Sampada Climate Foundation, a nongovernmental organization based in India, and a climate justice activist. 'The US' retreat, more fossil fuel production, no climate finance or aid, and trust in the multilateral system at the bottom — that's where we are. It's not inspiring.' The resulting vacuum in leadership is increasingly being filled by countries in the Global South, primarily China. In the wake of the Trump administration's yo-yoing on tariffs, President Xi Jinping reaffirmed China's commitment to climate action at a meeting of global leaders. In a speech last week, Xi announced that China would set more stringent emission targets ahead of COP30, the annual climate conference taking place in Brazil later this year. 'However the world may change, China will not slow down its climate actions,' he said. At the same time, China is forging stronger alliances across the world. With tensions rising between the United States and European countries over tariffs, China has been deepening diplomatic ties in Europe. Similarly, it has called for a 'Dragon-Elephant tango' with India, a country with which it has historically clashed over border disputes. 'We're seeing an inflection point in the global world order,' said Kaveh Guilanpour, a climate finance expert at the Center for Climate and Energy Solutions and a former climate negotiator for the United Kingdom, European Union, and small island states. 'It's accelerated in a matter of weeks, something that was probably going to take decades.' The shift in the global order toward the East is being recognized by top climate officials. COP30 President André Correa do Lago told reporters last month that with the US retreating from climate leadership and Europe prioritizing defense spending, countries in the Global South have an opportunity to step forward. 'The Global South has an important role to play at this stage,' he said. 'We followed the agreements and engaged in extensive debates but remained constructive. We accepted the Paris Agreement, among others. However, the North's commitments related to financial support and accelerating emission reductions have not materialized as planned.' It's unclear exactly what these changing political dynamics might mean for climate negotiations in Belém, Brazil, in November. For one, the distinction between developed and developing countries has been enshrined in climate agreements since the convening of the United Nations Framework Convention on Climate Change, the 1992 international treaty and process by which countries limit global temperature rise. That crucial classification was based on countries' economic status at the time — and hasn't been revised since. As a result, even as countries like South Korea, Singapore, and United Arab Emirates have grown economically and contributed increasingly more to climate change, they continue to be classified as developing nations during climate negotiations. While developing countries have worked to preserve the distinction on paper, many have contributed funding to poorer nations outside of the United Nations framework in recognition of their responsibility to help tackle climate change. According to one estimate, China, for instance, has provided $24 billion in climate aid to Global South countries since 2016. In 2023, during COP28 in Dubai, the United Arab Emirates pledged $100 million to help emerging economies manage the losses that have already resulted from a warming planet. Similarly, Brazil, Russia, and India have also contributed billions of dollars to multilateral banks and other international institutions that provide climate aid. Ultimately, these shifts in climate action and funding may allow for new partnerships to form and new climate leaders to emerge. 'If advanced economies are pulling back and ceding power and influence, and other countries are stepping up, shouldn't we recognize that?' said Joe Thwaites, an expert on international climate funding at the nonprofit Natural Resources Defense Council. 'That realignment is going to determine how successful a lot of climate action is going to be in the next decade or two.'
Yahoo
01-05-2025
- Business
- Yahoo
Who will finance global climate solutions? Not the West.
International climate action has long rested on the consequential distinction between the Global North and the Global South. Wealthier, earlier-to-industrialize nations contributed the most to a warming planet while developing countries bear the brunt of the climate crisis. As a result, developed countries have been called on to help developing nations reduce their carbon emissions and adapt to climate change by providing financial assistance, technology, and other resources. This essential premise has been embedded in various climate agreements signed since the 1990s, including the most recent pact inked at the 29th Conference of Parties, or COP29, in Baku, Azerbaijan, late last year. There, wealthy countries agreed to provide $300 billion per year to developing nations by 2035. Wealthy countries, however, have frequently failed to live up to their promises, slowly eroding the Global South's trust in a multilateral approach to the climate crisis. Over the last three months, the Trump administration has only accelerated that process. First, President Donald Trump withdrew the United States from the Paris Agreement, the 2015 climate treaty to keep global warming to less than 1.5 degrees Celsius. Then, Trump cut funding for various international climate programs, including the Just Energy Transition Partnerships and other initiatives supported by the U.S. Agency for International Development. And most recently, Treasury Secretary Scott Bessent criticized the World Bank and International Monetary Fund, prominent financial institutions that have made climate a priority in recent years, for straying from their mission. 'The IMF was once unwavering in its mission of promoting global monetary cooperation and financial stability,' Bessent said last week. 'Now it devotes disproportionate time and resources to work on climate change, gender, and social issues.' These changes in the U.S.'s stance are taking place at a time when the European Union is also slashing its development funding, which includes climate aid. Countries including the United Kingdom, Switzerland, Germany, France, and the Netherlands have cut as much as 37 percent of their aid budgets, moving the money instead to defense and stimulus measures. According to one analysis, the aid cuts add up to nearly $40 billion. While it's unclear exactly how much total climate aid will be lost as a result of these changes, the figure is a substantial portion of international climate finance. The U.S. alone provided $11 billion last year — 8 percent of global climate aid. Much of that has already been lost this year through cuts to the U.S. Agency for International Aid and the Green Climate Fund. 'We are at a very uniquely devastating moment,' said Harjeet Singh, founder of the Satat Sampada Climate Foundation, a nongovernmental organization based in India, and a climate justice activist. 'The U.S.' retreat, more fossil fuel production, no climate finance or aid, and trust in the multilateral system at the bottom — that's where we are. It's not inspiring.' The resulting vacuum in leadership is increasingly being filled by countries in the Global South, primarily China. In the wake of the Trump administration's yo-yoing on tariffs, President Xi Jinping reaffirmed China's commitment to climate action at a meeting of global leaders. In a speech last week, Xi announced that China would set more stringent emission targets ahead of COP30, the annual climate conference taking place in Brazil later this year. 'However the world may change, China will not slow down its climate actions,' he said. At the same time, China is forging stronger alliances across the world. With tensions rising between the United States and European countries over tariffs, China has been deepening diplomatic ties in Europe. Similarly, it has called for a 'Dragon-Elephant tango' with India, a country with which it has historically clashed over border disputes. 'We're seeing an inflection point in the global world order,' said Kaveh Guilanpour, a climate finance expert at the Center for Climate and Energy Solutions and a former climate negotiator for the United Kingdom, European Union, and small island states. 'It's accelerated in a matter of weeks, something that was probably going to take decades.' The shift in the global order toward the East is being recognized by top climate officials. COP30 President André Correa do Lago told reporters last month that with the U.S. retreating from climate leadership and Europe prioritizing defense spending, countries in the Global South have an opportunity to step forward. 'The Global South has an important role to play at this stage,' he said. 'We followed the agreements and engaged in extensive debates but remained constructive. We accepted the Paris Agreement, among others. However, the North's commitments related to financial support and accelerating emission reductions have not materialized as planned.' It's unclear exactly what these changing political dynamics might mean for climate negotiations in Belém, Brazil, in November. For one, the distinction between developed and developing countries has been enshrined in climate agreements since the convening of the United Nations Framework Convention on Climate Change, the 1992 international treaty and process by which countries limit global temperature rise. That crucial classification was based on countries' economic status at the time — and hasn't been revised since. As a result, even as countries like South Korea, Singapore, United Arab Emirates have grown economically and contributed increasingly more to climate change, they continue to be classified as developing nations during climate negotiations. While developing countries have worked to preserve the distinction on paper, many have contributed funding to poorer nations outside of the United Nations framework in recognition of their responsibility to help tackle climate change. According to one estimate, China, for instance, has provided $24 billion in climate aid to Global South countries since 2016. In 2023, during COP28 in Dubai, the United Arab Emirates pledged $100 million to help emerging economies manage the losses that have already resulted from a warming planet. Similarly, Brazil, Russia, and India have also contributed billions of dollars to multilateral banks and other international institutions that provide climate aid. Ultimately, these shifts in climate action and funding may allow for new partnerships to form and new climate leaders to emerge. 'If advanced economies are pulling back and ceding power and influence, and other countries are stepping up, shouldn't we recognize that?' said Joe Thwaites, an expert on international climate funding at the nonprofit Natural Resources Defense Council. 'That realignment is going to determine how successful a lot of climate action is going to be in the next decade or two.' This story was originally published by Grist with the headline Who will finance global climate solutions? Not the West. on May 1, 2025.
Bloomberg
24-03-2025
- Business
- Bloomberg
Indonesia Confirms $20 Billion Climate Deal Despite US Exit
The Indonesian government confirmed a $20 billion commitment from rich nations to help it shut polluting coal plants and transition to cleaner energy sources remains in place, despite the US exit from the agreement. Although the US had pledged to contribute billions of dollars according to investment plans drafted for the Just Energy Transition Partnerships, which included deals for Vietnam and South Africa, it withdrew amid the Trump administration's wider retreat from climate action. Analysts said this month the US exit could add further delays, but they expected the deals to survive.
Bloomberg
07-03-2025
- Business
- Bloomberg
Japan, Germany Step Up on Indonesia Climate Deal as US Exits
Japan's finance minister confirmed the nation will continue to support Indonesia's energy transition following the exit of the US from a $20 billion initiative to help one of Asia's biggest polluters shift away from fossil fuels. Global backers of Just Energy Transition Partnerships, or JETPs — which also include a roughly $15.5 billion deal for Vietnam and South Africa's $9.3 billion package — are assessing the financial impacts as US President Donald Trump pulls billions of dollars pledged to climate initiatives.
