Asian countries are witnessing robust economic growth in the aftermath of the pandemic, with predictions indicating that Asia’s GDP is set to double from 2019 levels by 2035 and quadruple by 2050. As economies expand, the demand for electricity intensifies, presenting a challenge for governments in the region to meet energy security goals while transitioning to cleaner energy sources.
In response, the Asia Natural Gas and Energy Association (ANGEA) commissioned a 2023 study by leading energy research company Rystad to identify issues impacting the region’s current energy security landscape. The study ﬁndings include recommendations on actions policy makers and others can take to address Asia’s “energy trilemma”: balancing energy sources that are acceptable, available, and aﬀordable.
The recommendations, together with the experience and insights on global best practices and energy market trends of ANGEA leaders and members, are intended to help policymakers manage energy market dynamics while also meeting national energy security and transition targets and economic development goals.
ANGEA said in a statement that it emphasizes the importance of a diversified energy mix, with natural gas playing a pivotal role in achieving sustainable energy security.
The trilemma of energy availability, affordability, and acceptance must be effectively balanced throughout Asian markets. ANGEA recognizes the significance of considering multiple fuel-source solutions and their contributions to a country’s energy security. Collaborating with governments across Asia, ANGEA advocates for the inclusion of natural gas in each nation’s energy portfolio as it is readily available, affordable, and emits lower carbon emissions compared to other fossil fuels.
Furthermore, natural gas can be decarbonized through Carbon Capture and Storage (CCS) Solutions, making it an ideal transitional fuel towards the utilization of variable renewables.
While a complete shift to 100% renewable energy is currently unfeasible due to cost and grid intermitencies, a combination of natural gas and renewables presents a viable solution for most Asian countries. However, to accommodate higher loads of renewable energy, grid infrastructure must be upgraded to address issues such as voltage fluctuations and intermittency.
Additionally, the cost of energy storage, which is still expensive and unproven, needs to be factored into the real cost of renewable energy.
Recognizing that energy requirements vary across countries based on specific resources and needs, ANGEA asserts that securing natural gas supply is critical for energy security in Asia. To support this claim, ANGEA recently conducted a comprehensive study exploring the region’s energy security landscape.
The study examined the cost, demand, and supply considerations of competing energy sources, aligned with economic and national aspirations. Its findings underscored the importance of securing natural gas supplies, given their transportability within the region and the ease of ramping down natural gas usage when feasible renewable sources are available.
Based on this research, ANGEA has proposed twelve policy recommendations that should form the core of each country’s energy security agenda. These recommendations encompass various strategies aimed at improving energy efficiency, securing long-term natural gas contracts, creating attractive fiscal and regulatory environments, bolstering national energy supplies, supporting the development of CCS technologies, and streamlining approval processes for geothermal and hydro-electric projects.
Moreover, ANGEA advocates for increased flexibility in operating existing power systems, redirecting fossil fuel subsidies to renewable sources, ensuring access to domestic material resources for renewable projects, and enhancing transparency in energy project capacity installation plans.
ANGEA firmly believes that by adopting these policy recommendations, Asian countries, particularly Indonesia, Thailand, and Vietnam, can continue their economic growth trajectory while simultaneously achieving their energy security objectives. The association highlights the vital role of natural gas in the overall energy mix as countries work towards their Net Zero commitments. Committed to collaborating with governments and business partners, ANGEA draws upon the expertise and experience of its members to help realize energy security ambitions while supporting the continued development of rapidly growing economies.
In summary, ANGEA’s research underscores the importance of a diversified energy mix and the inclusion of natural gas as a transition fuel in Asia’s energy security landscape. By implementing the recommended policies, countries can ensure sustainable economic growth while making significant strides towards cleaner and more secure energy systems.