Jakarta, 3 July 2020
London Climate Action Week #LCAW2020 takes place from 1-3 July 2020. The ASEAN Centre for Energy (ACE), represented by Beni Suryadi, Manager of Power, Fossil Fuels, Alternative Energy, and Storage who are also the project manager of the ASEAN Climate Change and Energy Project (ACCEPT) was invited to join at one of its events.
At the session “Clean Power Hub: Accelerating Clean Power for Economic Recovery and Beyond”, hosted by Propel Clean Energy Partners, Mr. Suryadi shared his view about how is COVID-19 impacting the power sector in the region, and what new tools, resources or changes to business as usual that would be useful for realizing a green recover.
How is COVID-19 impacting the power sector in Southeast Asia?
The worsened condition of the fast-spreading Coronavirus Disease (COVID-19) has urged many countries in the region to take measures in limiting people’s mobility. Several types of social distancing, which called Movement Control Order by Malaysian, Large-Scale Social Distancing by Indonesian or Enhanced Community Quarantine by the Philippines, have been implemented during the pandemic. These restriction measures result in a dire impact of not only slowing the economy but also impacting the energy sector, from halted energy projects due to the stranded logistical chain system to the significant drop of energy consumption, especially in electricity. The reduced daily electricity demand observed to happen in all countries in the region which apply the policy to force the citizen to stay home, due to the closing down of industries and business during quarantine times.
Several electricity projects in Indonesia, Myanmar, and the Philippines have also delayed until further notice. The halted and postponed power projects expected to shift a bit the focus of some national power master plan once the situation is back to normal. Some power development plan may be adjusted, and priorities reoriented in order to incorporate the coping mechanism of the power system with the new force major scenario of a drastic drop of demand due to large-scale quarantine.
To the other end, the COVID-19 outbreak also pushes the government to create stimulus packages, many of that is to subsidise electricity for the impacted communities to cope during this pandemic in the form of rebate or freeing the bills for some worth-to-get consumers. The government is also providing an extended payment deadline to ease the burden on electricity consumers in paying their routine electricity bills.
The current situation is definitely a challenging situation for all of us. It is still unsure how these reduced demands will impact the utilities in terms of earning and technical adjustment of shutting off the power plant to respond to the lower demand. It will very much depend on how fast the demand will bounce back as the economy starts again. However, inevitably this change in the electricity demand will create a domino effect to lower consumption in the sector such as coal or natural gas where several countries are currently dependent on it. More detail, please read Insights: Covid-19 vs. Electricity.
What new tools, resources or changes to business as usual do you think would be useful for realizing a green recovery?
For many years, countries in the Southeast Asia region are relying heavily on fossil fuels, especially coal and to some context, we are still going to have it as part of our energy mix in the future. However, in the last five years, you may see the acceleration as well on the development of renewable energy in the region. Different from what happens to most o the countries in Europe, renewable energy is still somehow considered an expensive option, however, it doesn’t stop the countries in pursuing to inject renewable energy into their energy system. The most recent one, the Vietnamese government on Thursday (25 June) formally approved 7 gigawatts (GW) worth of new wind projects to be built in the country, putting it on track for a total wind power generation capacity of nearly 12 GW by 2025. Vietnam has given the green light to almost a hundred new wind energy installations, indicating the nation keeps powering ahead with renewables amid fears of looming power shortages as industry and population boom.
For many years, the countries in the region are also thinking that they will only able to utilise renewable energy for the benefit of their own country. But it is no longer the case, as now we are working on the development of the new masterplan on the multilateral electricity interconnection in the ASEAN region under the umbrella of the ASEAN Power Grid. This new way of providing the green electricity to the region is expected not only hugely cost-saving but will also able to greening the grid. This new way of cooperation will allow the countries to collaborate with each other for a green recovery. I personally also thanking Peter as he provided a huge amount of support when we started this study.
Collaboration, cooperation, sharing the knowledge, sharing the information, jointly work on the issues – there are the critical components to help us escalating the process in realising a green recovery together. As a collective action, not an individual action.
In case you missed the session, a recording of the event is available here.