Asia on ‘unsustainable path’, ADB warns

By The Nation | Source: ANN
An environmental disaster and a gaping divide in energy access between rich and poor looms unless the region dramatically changes course.

A report by the Asian Development Bank yesterday expressed its increasing concern about energy supplies in coming years, which will be critical because of the strong improvement of Asian countries’ economic performance.

Hot weather in many Asian countries, including Thailand, fuels demand for electricity.

According to “Asia’s Energy Challenge”, a chapter of the ADB’s “Asian Development Outlook 2013”, Asia contributed about 28 per cent of the world’s gross domestic product in 2010. However, that proportion is expected to reach 44 per cent by 2035. As a result, energy use in Asia will dramatically increase from 34 per cent in 2010 to more than half of the world’s energy consumption in 2035.

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 the report. Asia’s energy endowment is not enough and dependence on fossil fuels will grow.

If by 2035 Asia merely expands energy access without fundamentally changing the way it consumes, the ADB report predicts the region’s oil consumption will double, natural-gas consumption will triple, and coal consumption will rise a whopping 81 per cent, with costly and devastating environmental impacts.

According to the report, Asia’s limited indigenous energy resources present an additional challenge. With only 9 per cent of proven global oil reserves, the region is on track almost to 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. Since access to modern sources is essential for their social and economic advancement, Asia must find the political will and innovation to scrap outdated policies and recalibrate its energy mix.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 that eliminating wasteful subsidies worldwide would lower carbon-dioxide emissions by 2.6 billion tonnes by 2035.

Carefully designed support for renewable-energy technologies must be stepped up, it says. Next-generation wind, solar and biofuel technologies, which are expected to be more cost-competitive than current options and not compete with food crops, offer potential solutions.