Asia is moving along a dangerously unsustainable energy path that will result in environmental disaster and a gaping divide in energy access between rich and poor unless the region dramatically changes course, says a new Asian Development Bank (ADB) report.
Asia’s Energy Challenge, the special theme chapter in ADB’s Asian Development Outlook 2013 (ADO 2013) released Tuesday, highlights the complex balancing act the region faces to deliver energy to all its citizens while scaling back its reliance on fossil fuels.
If by 2035 Asia merely expands energy access without fundamentally changing the way it consumes, the report predicts the region’s oil consumption will double, natural gas consumption will triple, and coal consumption will rise a whopping 81 percent, with costly and devastating environmental impacts. Asia’s limited indigenous energy resources present an additional challenge. With only 9 percent of proven global oil reserves, the region is currently on track to almost triple oil imports by 2035, rendering it significantly more vulnerable to external supply shocks. In Asia, 1.8 billion people still rely on wood and other traditional fuel as their primary energy source, it adds. Since modern energy access is essential for their social and economic advancement, Asia must find the political will and innovation to scrap outdated policies and recalibrate its energy mix. For one, policymakers will need to replace general fuel subsidies that artificially lower the cost of power and impose huge fiscal burdens with targeted subsidies for the poor.
The report suggests eliminating wasteful subsidies worldwide would also lower CO2 emissions by 2.6 billion tons in 2035. Carefully designed support for renewable energy technologies should be stepped up. Next generation wind, solar and biofuel technologies, which are expected to be more cost competitive than current options and do not compete with food crops, offer potential solutions.
Asia’s future prosperity requires major change in energy use: ADB
