Asia Requires Energy Overhaul to Sustain World’s Fastest GrowthMike Anderson
Asia will fail to sustain its economic rebound or protect its environment without changing the way it produces and consumes energy, according to the Asia Development Bank.
The continent’s gross domestic product is forecast to increase at the fastest pace globally, growing 6.6 percent this year and 6.7 percent in 2014, up from 6.1% in 2012, the bank said today in its annual outlook. Growth at that pace means Asia may account for 44 percent of global GDP by 2035 and consume more than 51 percent of its energy, up from one third in 2010, the bank said.
“Developing Asia must actively contain its rising demand, aggressively explore new supply sources and technology, and progressively integrate regional energy markets and infrastructure,” according to the bank’s recommendations.
Without reducing its reliance on fossil fuels, Asia will foul local air and water and emit 20 billion metric tons of greenhouses gases by 2035, almost the entire global target for sustainable emissions, the bank said. Asia needs to scale back subsidies that artificially reduce the price of energy and disproportionately help richer citizens, the bank said.
The region has potential to use more renewable energy, the bank said. Wind-generating capacity has risen to 82 gigawatts and solar capacity has jumped to 20 gigawatts, according to the report.
“Wind and solar are becoming cheaper and are expected to reach grid parity in some countries in a few years,” the bank said.
Even after generating more energy from renewable and nuclear sources, oil imports would have to rise from the current 11 million barrels a day to more than 30 million barrels per day by 2035, making Asia more vulnerable to external energy shocks, according to the bank.
“Asia’s growing thirst for oil imports makes the region more vulnerable to shocks from geopolitical tensions that may affect the production of this key commodity,” the ADB said in its report.
Asia’s reserves of shale gas have the potential to offset coal use, it said, estimating that China may have as much as 20 percent of global reserves of shale gas. Additionally, the region should aspire to connect its energy market by 2030.