Major countries in East Asia will have to invest an additional US$80 billion per year, or US$1.6 trillion into low-carbon technologies for the next two decades to stabilise the region’s growing carbon emissions.
The additional financing is needed on top of the US$100 billion a year that the region plans to invest to boost energy efficiency and develop renewable energies.
A new study launched on Monday by the World Bank found that it is “within reach” of the region’s governments to mitigate climate change without compromising economic growth, while improving energy security.
But while many countries are taking steps in these directions, accelerating the speed of these efforts is crucial, said the bank’s senior energy specialist, Dr Wang Xiaodong, who led the report.
“The window of opportunity is closing fast, because delaying action would lock the region into a long-lasting high-carbon infrastructure,” said Dr Wang.
The World Bank’s new study looked at the energy landscape of China and five Southeast Asian countries: Indonesia, Malaysia, the Philippines, Thailand and Vietnam.
It noted that although East Asia has experienced the fastest economic growth in the world for the last 30 years, it is also home to many of the world’s most polluted cities.
The region’s carbon emissions – regarded by scientists as the culprit for climate change – has more than tripled over the past 20 years, with China accounting for 85 per cent.
The “formidable challenge” now is to mobilize financing for the right investments, said Dr Wang at the report’s launch at the Thomson Reuters office at One Raffles Quay.
About US$85 billion per year is needed for energy efficiency in the power, industry and transport sectors, while US$35 billion is needed for low-carbon technologies.
But due to energy efficiency measures, US$40 billion will be saved in investments into thermal power plants, said the report.
If the region successfully moves in a sustainable direction, low-carbon technologies will meet half the region’s power needs by 2030, the report estimates.
Globally, only US$15 billion is spent on energy R&D, compared to US$300 billion in fuel subsidies, said Dr Wang.
Such subsidies by governments in China, Indonesia, Vietnam, the Philippines, Malaysia and Thailand should be cut to discourage energy consumption, said the bank.
Dr Wang also noted that even though eco-cities are sprouting across the region, there is no “national standard”.
“Singapore, with its proven model of compact urban design and planning, has a lot to offer in experience to these emerging cities,” she said.
Meanwhile, the bank is focused on conducting policy dialogues across the region and stepping up knowledge sharing to local banks so that more financing can be offered to energy efficient and clean technology solutions, she said.
