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RI has potential to be renewable energy exporter to ASEAN, report finds
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A worker cleans solar panels that generate electricity for a gas refueling station in Teras, Boyolali, Central Java, on Oct. 26, 2022. (Antara/Aloysuis Jarot Nugroho)
S
outheast Asian nations are struggling to meet their emissions reduction commitments and unlock their green economic potential, a recent study has found, but Indonesia may be well positioned to take advantage of a future renewable energy boom.
The 2023 Southeast Asia’s Green Economy report, published on Tuesday by Bain & Company, Temasek, GenZero and Amazon Web Services, found that the region would require over US$1.5 trillion in cumulative investment by 2030 to meet its emissions reduction targets, as measured by the nationally determined contributions (NDCs) of each country.
However, green capital deployment has been slowing over the past years. In 2022, US$5.2 billion was invested in green projects, down 7 percent from the previous year.
Renewable energy projects face high hurdles, with investors expecting more than 20 percent returns, the report noted, and such returns were difficult to achieve in the prevailing economic environment.
More than half of last year’s green investment last year was in Singapore and Indonesia, the report found.
“[Southeast Asian] governments, therefore, need to focus first on proven solutions to balance the rising energy demand while reducing carbon emissions,” Dale Hardcastle, global head of carbon markets and director of the global sustainability innovation center at consultancy Bain & Company, said in a statement on Tuesday.
Read also: 'Show me the money': RI frustrated with green financing deadlock
