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REN21 10 Years Report

35 01 SOUTHEAST ASIA n GENERAL OVERVIEW The past decade was dominated by the development of renew- able energy policies across Southeast Asia. The first promising markets were developed in Thailand and Malaysia, followed by the Philippines and Indonesia. Energy demand—both for trans- port fuels and for electricity generation—continues to grow faster than the deployment of renewables. While the mainland states of Southeast Asia rely heavily on gas and coal for power genera- tion, the island states such as the Philippines and Indonesia still use a large number of diesel generators on their smaller islands. Renewable energy potentials are diverse across the region; solar, wind, hydro, and biomass as well as geothermal and ocean energy can be utilised. The geographical situation favors decen- tralised distributed power generation and mini-grids. n MAIN DRIVERS FOR RENEWABLES Security of supply, access to energy and the diversification of the energy supply structure are the main drivers for renewable energy deployment across South East Asia. In Indonesia for example, where approximately 50 million people have no access to energy services, off grid renewable energy solutions represent a strategically important technology. n RENEWABLE ENERGY POLICY DEVELOPMENT The policy landscape across South East Asia is diverse. Over the past decade many different forms of policies have been launched, tested and changed, using renewable energy legisla- tions from Europe and the United States as a basis to develop national mechanisms. Several countries have established renewable energy targets for electricity and/or transport fuels. Thailand raised its overall renewable energy target to 25% of its final energy consumption by 2021. Existing targets for bio- mass, waste-to-energy, solar PV and wind were also increased. Renewable energy support funds have been established, includ- ing a USD 120 million fund to encourage state agencies to deploy solar PV systems on their buildings. Indonesia established a renewable electricity target of 26% by 2025 and a feed-in tariff for biomass and geothermal. Two Indonesian cities have developed low-emission strategies. Malaysia established a FIT scheme with rates to decline by 8% annually for plants smaller than 24kW and by 20% for larger plants and a biofuel target. The Philippines established a FIT in 2012 for all renewable power technologies. n DEPLOYMENT OF RENEWABLES Geothermal energy, small hydropower, solar PV, wind and bio energy are expanding across Southeast Asia. Indonesia and the Philippines have the largest market for geothermal power plants in the region, while Thailand and Malaysia host the largest capac- ity of solar PV installations. Taiwan, South Korea and Thailand have the largest wind market in the region followed by Vietnam and the Philippines. n MILESTONES OF THE PAST DECADE Malaysia established a significant production capacity for solar PV and supports a domestic market via a FIT. Vietnam focuses on the expansion of large hydropower, while Indonesia and the Philippines prioritised the support of utility-scale geothermal power plants. Thailand has successfully introduced bankable renewable energy schemes, reducing financing challenges still experienced by other regions in Southeast Asia. n MAIN CHALLENGES FOR RENEWABLES In contrast to a consistent renewable energy scheme in Thailand, rapid policy changes in the Philippines and Indonesia have had a negative impact on the financing of renewable energy projects. Construction permits and grid codes for renewable energies are diverse and often unclear across the region. In Indonesia for example a photovoltaic installation requires up to 500 permits, making project development extremely difficult, if not impossible. The Asian Development Bank has established a renewable energy programme which provides technical assistance. Although this programme eases access to finance for project developers, obtaining funding for the growing renewable energy project pipeline still remains challenging.

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