Governments across Southeast Asia accelerate renewable energy investment to revive the pandemic-hit economies

Published onJanuary 22, 2021

In the pre Covid-19 world, energy transition was already at the forefront of the minds of policymakers and investors in the Association of Southeast Asian Nations (ASEAN). Renewable energy infrastructure investment in the region had been strong, reflecting government efforts to reduce carbon emissions, as well as due to the lower costs involved, given cheaper technology and economies of scale. Although construction activity in the sector weakened significantly in 2020 due to fiscal constraints as governments diverted budgets towards social expenditure, investment in the renewable sector is expected to pick up quickly. To improve the renewable energy capacity and revive the pandemic-hit economies, ASEAN governments have laid out an aspirational five-year sustainability plan under the second phase of ASEAN Plan of Action for Energy Cooperation (APAEC) 2021-2025. Under this, ASEAN energy ministers agreed to set a target of 23% share of renewable energy in total primary energy supply in the region and 35% in ASEAN installed power capacity by 2025.