While much good progress has been made with the renewable energy transition, the APAC region has reached a critical point, said global renewable energy developer BayWa r.e. after surveying 346 energy decision influencers at organizations with 100 or more employees in Australia, Indonesia, Japan, Malaysia, Singapore, South Korea, Thailand, The Philippines, and Vietnam.
Headwinds and pressure in the region, such as the implications of the Russia-Ukraine war, lack of support from governments, and volatile prices of energy and interest rates pose a serious risk to the pace of change and climate goals.
Slow government implementation of renewable energy policies and unpredictable policy environments in local markets are listed within the top three barriers indicated by respondents, at 36 per cent and 33 per cent, respectively.
For example, more than half of respondents in Southeast Asia believe that instead of pushing for green energy, governments in this region will increase their support for fossil fuel-based energy in the next two to three years. While for corporations in Oceania and East Asia, 47 per cent believe that government support for fossil fuel-based energy will remain unstable in the next two to three years.
While the outlook for the renewable energy transition is one of the challenges and obstacles to be overcome, the urgent need for change is recognized by APAC corporates.
Close to half of the corporations surveyed have made energy transition a priority, with 48 per cent of APAC companies aiming to increase the use of renewable energy by more than 40 per cent over this decade. Within this group of companies, 79 per cent are looking to achieve it in the next five years, providing cause for optimism.
Companies surveyed also saw the value in transitioning towards cleaner energy options, including a better image, business advantage, and advantage in talent recruitment and retention at a time when large-scale commercial roof-top solar has become cheaper than subsidized power in Southeast Asia.
To help the transition towards green energy, 42% of APAC corporates believed that government tariffs on brown power will support their organization’s push towards renewable energy.
However, frustrated by inconsistent government policy, companies are taking the lead and calling for intercompany coalitions to advance sustainability goals.
“Challenges on the road to the transition will persist, and it will be imperative for corporates and governments to come together to overcome them. The APAC energy report has shown that corporate leaders are motivated to gather their peers and competitors and call for more public-private partnerships to fulfill the global net-zero goals”, said Niranpal Singh, Managing director Malaysia, BayWa r.e.
Corporate leaders surveyed for the report acknowledged the greater need to collaborate with peers and competitors and accelerate the clean energy transition. Two-thirds of companies that are leading the change towards renewable energy strongly agree that companies should form coalitions and work together to achieve sustainability goals. The exact number of respondents also indicated support for countries in APAC to work together to provide renewable energy.
The transition from traditional energy is now critical and must happen at a much greater pace. Corporate decision-makers must take the lead in powering the change within APAC and band together, while working with and putting pressure on governments, to accelerate this process and rapidly advance renewable energy adoption.
“We hope that with this urgent call to action, substantial progress can be seen in green energy adoption within the APAC region,” said Niranpal Singh.