2024年东盟清洁能源发展路径洞察报告（英文版）

ASEAN’scleanpower

pathways:2024insights

GrowingelectricitydemandandrelianceonfossilfuelsinASEANcontinuetohinderclimategoalsandeconomicopportunities.Solar,windandbatteries,supportedbyinternationalcooperationandgridinterconnection,offerthebestsolutions.

Publisheddate:22October2024

Authors:DinitaSetyawati,ShabrinaNadhila

1

Contents

ExecutiveSummary

Introduction

Powersector2023

ElectricitylandscapeinASEAN

Stateoftransition

ASEANneedstoscaleuprenewablestohelpmeetrisingdemand

Policyinsights

Policiesinthepowersectorandthewiderlandscape

What’shotin2024

ASEANisfeelingtheheattotransition

Keyrecommendations

Conclusion

SupportingMaterials

About

ThisreportprovidesabriefoverviewofASEAN’spowersectorlandscapein2023,tracksenergytransitiondevelopmentinthepastfiveyears,presentsseveralscenarioson

decarbonisationforASEAN,documentspolicychangesinthepastyearandemerging

discoursesinASEANenergytransition.Thisreportpresentsstrategiestofine-tuningpoliciestoreducedependenceonfossilfuelsandstartthesystemicshiftnecessaryforaclean

powersectortransition,providingstrategicguidanceforpolicymakers,researchersandenergypractitionersintheregion.

2

Highlights

+3.6%

+62%

21TWh

Riseinelectricitydemandin2023,thatwasentirelymetbyfossilfuels

Percentagepointofaveragebioenergycostcomparedwithwindandsolar

Declineinhydrogenerationbetween2022and2023

despite0.5GWcapacityaddition

3-5x

ASEAN’srenewablecapacityincreaseby2035accordingtoseveralpublished

pathways

ExecutiveSummary

ASEANisthenextgrowth

powerhouse-willrenewableenergyleadthecharge?

ASEANhasambitiouseconomicgrowthtargets,whilsttransitioningawayfromcoalandseekingsuitablerenewablessolutions.

ASEANeconomicgrowthremains

strongandresilient,

drivenbydomesticandglobal

demand.Ongoingindustrialisation,electrificationanddigitalisationareexpectedtodrive

greaterelectricitydemand,

puttingmorepressureonaregiontraditionallydependentonfossilfuels.Demandissettoincreaseevenfurther,upto41%by2030from2023level.

4

IfASEANcontinuesitsenergytransitionatthe

currentpace

,itrisksmissingoutontheopportunitiesprovidedbythedecliningcostsofwindandsolar,now

cheaper

thanfossilfuels.

Between2018and2022,38GWofrenewableenergycapacitywasadded,withabout44%comingfromsolarcapacitygrowthinVietNam.However,replicatingthissuccessis

challengingduetocurtailmentrisksandgridconstraints,leadingtogovernmentstakingamore

cautiousapproach

andslowingdowntheshiftawayfromfossilfuels.

Currentplansindicatethatmuchoftherisingelectricitydemandwillbemetbyfossilfuels,potentiallyincreasingimportdependenceforsomecountries,asseenwith

Singapore

and

Malaysia

’srelianceongas.InothercountrieslikeIndonesia,

maintainingcoaldependency

risksunderminingtheirpotentialcontributiontoclimatetargets.

Inlightofthedroughtsandchangingclimaticconditionsin2023,

hydroisbecomingless

reliable

fortheenergytransition.Bioenergy,oftenseenbythegovernmentasthemost

promisingsolutionforenergysecurityandeconomicdevelopment,particularlyforfarmers,faceschallengessuchasseasonality,unpredictability,limitedmaximumquantityandfoodversusfuelallocations,makingitanexpensive

energysource

inASEAN.

Wind,solarandbatteriesofferapromisingwayforward,as

seen

inothercountries.

Moreover,alevelizedcostofelectricity(LCOE)andauctionpricesconfirmthatsolarisamongstthecheapestenergysourcesforelectricitygeneration.

Acrosstheregion,solarandwindhaveinteresting

complementarities

,showingthatASEANcaneaseitscollectiveenergytransitionjourneythroughcooperationandinterconnection.

Otherpolicyoptionsforgovernmentsareavailabletoboostcleanenergyuseinthepowersector,theend-usesector(industrial)andthewiderlandscape,includingdirectrenewablepowerpurchases,fast-trackingrooftopsolarandcreatinggreenjobs.

Directpowerpurchaseagreementsareessentialfor

unlockingwidercross-borderelectricity

tradinginASEAN

andcreatingnewopportunitiestospurthegrowthofgreenindustriesin

Indonesia.

GovernmentsinVietNam,thePhilippines,ThailandandIndonesiahaveimplemented

strategicpoliciestoboostrooftopsolardeployment.TheseincludeVietNam'spilotscheme

5

forsellingexcesssolarpower,Thailand'srelaxedpermitrequirementsandtaxincentives,the

Philippines'pushofpeer-to-peertradingandlargerenewableenergyprojects,andIndonesia'sregulationsettingannualquotasforrooftopsolarinstallations.

Greenjobpoliciescreateemploymentopportunitiesinrenewableenergysectors,stimulatingeconomicgrowthwhilehelpingtooffsetjoblossesinfossilfuelindustries.

01ASEANelectricitydemandgrewby3.6%in2023,entirelymetbyfossil

fuels

Between2022and2023,ASEANelectricitydemandgrewby45TWhthat

wasentirelymetbyfossilfuels.Withoutrapidscalingofenergyefficiencysolutionsandlow-carbonelectricitysourcesinthecomingyears,emissionscouldrisesignificantly,especiallyaselectricitydemandisprojectedtogrowbyabout7.3%annuallythrough2030.

02Solarandhydroarethemaindriversoftransition;however,annualhydrogenerationdeclinedin2023

Hydropowergenerationin2023decreasedby21TWhfrom2022levels,

despiteanadditionalinstalledcapacityof0.5GW.Theimpactsofclimatechange,includingdroughts,mayfurtherunderminehydroreliabilityfor

cleanenergygeneration.Atthesametime,solargenerationonlyincreasedby2.7TWh,demonstratingtheneedtoboostrenewables.

6

03Solar,hydroandgeothermalarethecheapestoptionsfornewgeneration

BioenergyremainsthemostexpensiveoptioncomparedtootherrenewablesourcesinASEAN.InIndonesia,MalaysiaandThailand,itsLCOEranged

between$59-98USDperMWh,whilecoalwasnearly$60USDperMWh

acrosscountries.Gascosts$42-43USDperMWhinMalaysia,SingaporeandThailand.Incomparison,hydrowasaround$25USDperMWhinLaoPDR,andsolarbetween$44-50USDperMWhinVietNamandThailand.

Windcosts$43-73USDperMWhinthePhilippines,ThailandandVietNam.

04Solarandwind’scompatibilityin

ASEANmaybethedriverforrenewablesgrowth

AcrossSoutheastAsia,spatialandtemporalanalysesdemonstratethatwindandsolarpowergenerationcomplementeachotherduringdifferentmonths.Thispresentsopportunitiesforsecuringpowerthrough

interconnections,enhancingmutuallybeneficialrelationshipsamong

countrieswithrenewablespotentialandmarketopportunities.Scalingupsolaruseisimportant,asitsreliabilityoftensurpassesthatofwind(suchasonshorewind)insomepartsoftheregion.

7

ASEANrenewableenergyshiftpromisesnewjobs,strongerenergysecurityandeconomicgrowthopportunities.Collectiveeffortsthroughinterconnection

programmesandinternationalcooperationinfinancingandsharingofresourcesoffersolutionstopushandpulldynamicsforrenewables.

DrDinitaSetyawati

SeniorElectricityPolicyAnalyst-SoutheastAsia,Ember

Effectivecarbonmarketregulationscanscalethemarketanddrivethetransitiontoalow-carbonpowersector.Carbonpricingcanchannelrevenuemore

effectivelyintoclimateprojects,includingrenewables,surpassingtheimpactofvoluntarymarkets.Awell-designedcarbonprice,particularlyinthepowersector,ensuresliquidityandaccountabilityandsupportsenergyaffordability.

ShabrinaNadhila

ElectricityPolicyAnalyst-SoutheastAsia,Ember

8

PowerinterconnectivityiskeytoASEAN’seconomiccooperation.LaoPDR's

successinelectricityexportshighlightstheregion’spotential.Byfosteringa

sharedidentityaroundrenewableresources,interconnectioncandriveeconomicgrowth,createjobsandimprovelivelihoodsacrosstheregion.Thiscross-bordertradeincleanenergywillenhanceregionalintegrationandcontributetothe

ASEANEconomicCommunity,openingnewrevenuestreamsforLaoPDRandneighbouringcountries.

SouliyaSengdalavong

DeputyDirectorGeneralofEnergyPolicyandPlanningDepartment,MinistryofEnergyandMines,LaoPDR

Introduction

Systemicshiftnecessaryfor

ASEAN’scleanpowertransition

WhatarethetrendsinASEANelectricitysectortransition,andwhyfine-tuningpoliciesisnecessary?

ASEANaimstoincreasetheshareofrenewableenergyto23%ofitstotalenergymixby

2025,withagoalofachievinga35%shareofrenewableenergyininstalledpowercapacity,upfrom32%in2022.

Electricitygenerationfromrenewablesourcesreached28%in2022,withhydrocontributingthelargestshare.Whilethereisnocollectivetargetfornet-zerocarbonemissions,some

individualcountrieshavesetnetzerotargetsbetween2050and2060.Currentregionalgoalsalsoincludeachieving100%electricityaccessby2040.

Theregioncurrentlyaccountsfor

3.5%

ofglobalgreenhouse-gasemissions.However,thisshareisexpectedtoincreasesubstantiallyduetopopulationgrowth,

expansionof

manufacturing

andincreasingelectricitydemandfromtheregion’s

datacentres.

Inabusiness-as-usualscenario,ASEAN’spathtodecarbonisationwillbe

gradual

,with

coal

and

gas

continuingtoplayaprimaryroleinsecuringtheregion’senergysupply.

Theregion’senergytransition,ledbycountrieslikeVietNamandSingapore,willprogressatits

ownpace

,morelikelytoalignwithnationalenergypoliciesthantheIEA'sglobalnet-zeroemissionsscenarioby2050.However,theopportunitiespresentedbycleaner,moreefficientandsustainablerenewableenergyofferanalternativeandcould

speedup

theregion’spaceoftransition.

10

However,datalimitationmaypotentiallyhinderenergytransitionplanning

ElectricitydatainASEANfaceslimitationsintermsofupdatefrequencyanddatatypes.Theavailabilityofelectricitysectordatavariesbycountry.Singapore,VietNam,PhilippinesandThailandhavethemostup-to-dateandaggregateddataatthemonthlylevel.Therestof

ASEANcountriesprovideelectricitydataonanannualbasis.ThelatestgenerationdataavailableforBruneiDarussalam,Cambodia,LaoPDR,thePhilippines,Myanmarand

Malaysia,atthetimeofthewritingofthisreport,onlyextendsto2022.

DataonASEANcountries’powercapacityfrom

GlobalEnergyMonitor

(GEM)reflects

differencesintheinclusionofcaptivepowerplants.Forexample,allcoalplantsinBruneiDarussalamarecaptive,andIndonesia’scoalcapacitydataincludescaptivepower.

Understandingthesedistinctionsisimportantforaclearerviewofcapacitydataacrosstheregion.

WhileEmberhascuratedandinterpreteddataonAsiainthe

AsiaElectricityDataFinder,

thelimitedpubliclyavailabledatainSoutheastAsiaposesasignificantrisktotheenergy

transition.Effectiveintegrationofrenewableenergysourcesintothegridrequiresaccurate,real-timedataonenergyproductionandconsumption.Withoutsuchinformation,

policy-makingandinvestmentdecisionsareatriskofdelays,potentiallyslowingdown

progress.Addressingtheselimitationsthroughbetterdatacollection,analysisandsharingiscrucialtoacceleratethetransitiontoasustainableenergysystem.

Withrisingelectricitydemand,energytransitiondecision-makingmustconsiderstrategiesforbetterdatatransparency,availabilityandaccuracy,aswellasfine-tuningpoliciesto

incentivisedatareportingandsupportdataanalyticsforstakeholders.Thiswillenableamoreholisticplanningtoreducedependenceonfossilfuelsandstartthesystemicshiftnecessaryforacleanpowersectortransition.Thisincludesattractingmoresustainablecorporationsthroughcleanenergyprocurementoptions,aligningnationaltargetswithregionalgoalsandimplementingsupportivepoliciestofosterrenewableenergymarketgrowth.Theserecommendationsareexploredinmoredetailinthisreport,providing

strategicguidanceforpolicymakers,researchersandenergypractitionersintheregion.

Powersector2023

ElectricitylandscapeinASEAN

ASEANdemandgrewby3.6%in2023,entirelymetbyfossilsascleanenergygrowthstruggledtokeeppace,pushingemissionsupby6.6%in

2023.Peakdemandinsomecountriesoccursduringdaytime,highlightingthepotentialforsolar.

ASEANenergydemandhasmorethandoubledinthepasttwodecades,risingfrom458TWhin2003to1,258TWhin2023.Post-pandemiceconomicrecovery,

risinguseofelectric

vehicles

andthe

developmentofdatacentres

,willdriveelectricutilitiestoincreasetheirforecastsforadditionalpowerneededby2030.

Usingasix-yearcompoundannualdemandgrowthrateof3.3%between2018and2023,demandcouldreach1,626TWhby2030,up30%from1,258TWhin2023.Meanwhile,the

ASEANEnergyOutlook(AEO)8

projectstotalpowergenerationrequirementsin2030torangebetween1,545-1,567TWh,demonstratingtheurgencyforafastercleanenergy

transition.

RisingelectricitydemandisexpectedacrossASEAN

Electricitydemandgrowthslowedto3.6%in2023,downfrom4.9%inthepreviousyear.Nevertheless,demandforelectricityisexpectedtokeep

rising

.

Thisyear,extreme

heatwaves

hitASEANcities,promptinggovernmentstocloseschools.Electricitydemandforcoolinghomes,shoppingcentresandofficesislikelytosurgeasclimatechangepushesglobaltemperatureshigher.

12

Country-levelvariationsinSoutheastAsia’spowersectorarepronounced,withdiverse

energyresources,populationdensity,geographicaltopography,developmentgoalsandtheavailabilityofcleanenergyinvestments.MyanmarandVietNam,forinstance,havelarge

windpotential

,whileLaoPDRandCambodiaholdsignificanthydropotential.

Incontrast,Singaporeisemergingasasignificanteconomichubdespiteitslimitednaturalresources,relyingon

regionalgridconnectivity

forcleanenergyimportstomeetincreasingelectricitydemand.CurrentlySingaporeaimstoimportupto

6GWoflowcarbonelectricity

by2035

,positioningthecountrytonearlymeettheIEA’stargetof

8.1GWlowcarbon

electricityimportby2035.

AllASEANcountriesareforecastingelectricitydemandgrowththrough2030,withannualgrowthprojectionsrangingfrom1.8%to19%.

Myanmarisexpectedtoseethelargestincrease,withelectricitydemandprojectedtoreach

57TWhby2030

,upfrom17TWhin2023.VietNamandCambodiaanticipategrowthratesof

11%

and

17%

,respectively,duringthesameperiod.Bruneiprojectsamoremodestgrowth

13

of

1.8%by2030

.Overall,theaveragedemandgrowthacrosstheregionisexpectedtobearound7.3%annuallyby2030.

Allnewelectricitydemandin2023wasmetbyfossilfuels

In2023,fossilfuelsmadeup74%ofelectricitygeneration,withcoalprovidingthemajorityat44%.Renewablesaccountedfor26%ofpower,downfrom28%in2022,primarilydrivenbya2.3%decline(-21TWh)inhydro’sshareofpowergenerationbetween2022and2023.

Between2022and2023,newdemandgrowthwas3.6%(45TWh),whichwasentirelymetbycoalandgaspowergeneration.Indonesiaalonecontributed11TWhtothecoalincrease,

highlightingitsposition

asthelargestcoaluserwithyoungcoalpowerplants.Incontrast,ASEAN’snon-hydrorenewablesgrewbyonly8.5TWhduringthesameperiod.

14

ContinuingatthispaceoftransitionrisksASEANbecomingmoredependentonfossilfuels,missingopportunitiespresentedbyemergingcleanenergytechnologiesandeconomics,

andfailingtomeetclimatetargets.Meanwhile,electricitydemandcontinuestogrowrapidly,makingitmoreimportantthanevertomeetthisdemandwithcleanenergy.

Soaringdemandscoupledwithintensefossilfuelusearepushingupemissions

Increaseduseofcoalandgaswasthemaindriverbehindtheriseofover44milliontonnesinASEANpowersectoremissionsin2023,markingthelargestannualriseinabsolutetermsinthepastdecadesafter2019.

15

ASEANpowersectoremissionsroseby6.6%in2023to718milliontonnesperCO2,with66%comingfromcoaland32%fromgasandotherfossil.About78%ofthispowersectoremissionsincreasecamefromIndonesiaVietNam,whereemissionsroseby14milliontonnesand20milliontonnesrespectively.

InIndonesia,VietNam,MalaysiaandthePhilippines,coalwasthebiggestcontributortocarbonemissions,whileinThailandandSingapore,emissionsstemmedmostlyfromgas.

Declineinhydrogenerationin2023indicatesseasonalrisksexist

ASEAN’srelianceonhydroposes

risks

from

lesspredictableandpotentiallymorevariable

hydrogenerationduetoclimatechangeandthescarcityofviablehydrosites.

16

Inthesummerof2023,persistent

droughts

acrosstheregionresultedindecliningelectricitygenerationfromhydro,despitecapacityadditionsof0.5GW.

Hydropower-richmemberstatesmayneedtorampupotherrenewableenergysources,suchassolarandwind,todiversifyenergysupplyintimesofchangingclimate.Forexample,

NorthernVietNam’sheavyrelianceonhydro

hittheregion

particularlyhardin2023whenseveredroughtshaltedoperations,leadingtoaregionalpowershortage.

SurgingpeakdemandduringsolarhourspresentsopportunitiesforsomeASEANcountries

AsASEANisfindingsolutionstodecarbonisetheirpowersystemsthroughrenewableenergyintegration,understandingtheelectricitydemandpatternsiscrucialformaintaining

grid

stabilityandfrequency

.Toenablegridstoabsorbintermittentenergysources,

several

measures

areneeded,suchasimprovementofforecastingpractices,systemflexibility,operationalflexibilityandgridreliability.

UnderstandingconsumptionpatternsanddailyloadprofilesisacrucialfirststepinanalysingthedifferentdemandcharacteristicsanddriversinASEAN.Duetolimited

aggregatehourlydataforsomecountries,thisreportpresentstheloadprofilesofSingapore,thePhilippinesandPeninsularMalaysiain2018and2023toobservechangesinelectricityconsumptionpatterns.

17

ThedatasuggeststhatpeakdemandfollowssimilartrendsinMalaysia,thePhilippinesandSingaporewherepeakelectricityconsumptionwasseenduringdaylighthours.InMalaysia,peakdemandreached20GWat4pmin2023.InthePhilippines,peakdemandalsorecordedat20GWat2pm.InSingapore,peakdemandreached7.6GWat4pmin2023,which

changedfrom11amin2018.Thesedaytimepeakdemandhourshighlighttheopportunitiestorampupsolarpoweruseasoneofthesolutionstomeetelectricityconsumptionduringtheseperiods.

Stateoftransition

ASEANneedstoscaleup

renewablestohelpmeetrisingdemand

InASEAN,thecostofelectricityfromhydro,solarandgeothermalisnowcheaperthanbioenergyandcoal.Fallingcostsmakesolarandwind

moreviablethanbefore,especiallyasclimatechangeimpactsonhydroproductionintensify.

ASEAN’sfocusoncleanenergyissettoshifttowardssolarandwindinthecomingyears.

Regionaltargets

setbythecountriesin2023aimfor15%ofpowergenerationcomingfromsolarandwindby2040,upfrom4.5%in2023.

ASEANcountriesarealigningtheir

nationalenergytargets

andpolicieswiththisshift,

prioritisingsolarandwind.VietNamhassetanexplicittargetof

47%

renewablesin

electricitygenerationby2030,with

62%

ofthiscomingfromsolarandwind.ThePhilippinestargets35%ofrenewablesby2040,with

16%

ofthistargetmetbysolarandwind,accordingtotheirPowerSectorDevelopmentPlan2020-2040.

Toachieveanetzerofuture,thesetargetsneedtobebackedbydelivery.Despiteprogressinthepastfiveyears,fossilfuelscontinuetodominatetheregion’selectricityuse.Concerns

remainthatthegridsystemsinASEANmaynotbereadytoaccommodatemoreintermittentenergysources,asseeninVietNamwhere

curtailment

hasbeenanissue,

avoidingrisk

forsystemgridoperatorsduetotheuncertaintimingand

quantityofelectricity

supply.

19

SolarandhydrohavebeenthemaindriversofREgrowthinASEANsince2017

AquickreviewofelectricitydemandandrenewablesbuildupinASEANinthepastfiveyearsshowssomeprogressanda

pivotawayfromcoal

.Financialinstitutionsareimposing

restrictions

oncoalinvestment,likelyencouragingASEANtomoveawayfromcoal.

Historically,hydroandsolarhavebeenthemaindriversofrenewablesgrowthinASEAN.

HydroexpansionismostnotableinLaoPDR,followedbyMalaysiaandVietNam.Solar

powercapacitysurgedfrom11GWin2019to26GWin2023,largelyduetoVietNam's

feed-intariffintroducedin2017.PeninsularMalaysiahasalsomadestrideswithitssolarnetmeteringscheme,consistentlymeetingitsquotas.

20

Between2018and2023,solarcapacityadditionintheregionwas21GW,mainlyduetothesolarcapacitygrowthinVietNam.Bioenergycapacityincreasedby2.3GW,reachingatotalof9.9GWin2023.Similarly,hydrocapacitygrewby11GW.However,windpower,historicallylesscommonintheregion,faceschallengesduetoitsrelativelynewtechnologystatus,

lack

ofscaleandunderdevelopedsupplychains.

Thehistoricrelianceonfossilfuelshasresultedinsignificantpathdependenciesontheseindustriesthatshouldbeshifted.Factorsinfluencingthisshiftalsoincludetheavailabilityoflow-interestfinancingorgrantsfornewrenewableenergytechnologiesthatwillacceleratetheadoptionofrenewables.

Renewablescanhelp

curbtheriseinemissions

whilealso

drivingeconomicgrowth

by

attractinginvestmentandpromotinglocalmanufacturing.ThissupportsASEAN'sgoalof

avoidingthemiddle-incometrap

causedbyGDPlossesduetoclimatechange.

ThevolatilityinhydrogenerationmeansASEANneedstoboostothercleanenergy

Overthepastfiveyears,hydrogenerationhasbeenvolatile,demonstratingthatover-relianceonhydroposesarisktothestabilityofcleanelectricitysupplymixincountrieswherefossilfueluseandelectricitydemandishigh.Despiteadding12GWhydrocapacitybetween2017and2023,itsshareintheelectricitymixhasdeclinedby2.2percentage-points.In2023,theinstalledcapacityofhydroreached57GW,or18%oftheregion’stotalinstalledpower

capacity.

Geographically,thelargesthydrocapacityisinVietNam(23GW),followedbyLaoPDR(9.8GW),Indonesia(6.8GW)andMalaysia(6.2GW).LaoPDRexportshydroelectricityto

neighbouringcountries,includingCambodia,VietNam,China,ThailandandSingapore,makingita

profitablemarket

.

Asthemostmaturetechnologyintheregion,hydrohasconsistentlyattractedthelargestshareofinvestments,accountingforaround

38%publicprivatepartnerships

oftotal

21

investmentsinASEAN.However,collectively,thecapacityfactorofhydropowerplantshasalsodecreasedfrom46%to40%,highlightingtherisksofASEAN’sover-relianceonhydrotomeetrisingenergyconsumptionandmanageemissiongrowth.

Solar,hydroandgeothermalarecurrentlycheaperthanbioenergy

InASEAN,bioenergyistradionallyseenasarenewableenergysourcewith

significant

potential

foreconomicdevelopmentlinkedtoagriculturalproducts,newbusiness

opportunitiesandpovertyalleviation.Forexample,theIndonesiangovernment

has

introduced

amandatory35%blendedbiofuelregulationforthetransportationsector,withafurtherplantoraiseitto50%.

22

However,bioenergy’slevelizedcostofelectricity(LCOE)remainsthemostexpensiveoptioncomparedtootherrenewablesources.Renewables,includingsolar,solarwithbattery

storage,hydro,geothermalandwind,arecheaperthanbioenergy,onanLCOEbasis.

Levelizedcostofelectricity(LCOE)

Thelevelizedcostofelectricity(LCOE)istheaveragecosttoproduceelectricityfromasystemoveritsentirelifetime,includingthecosttobuildandrunit.

23

TheLCOEofbioenergyis

almostfourtimesmore

thanthecostsofhydroinsomecountries.Forexample,bioenergycostsfrombiomasspowerplantsinIndonesia,Malaysiaand

Thailandrangefrom$59to$98USDperMWh,comparedtohydro,whichismuchcheaperataround$25USDperMWhinLaoPDR.Similarly,solarpowercostsbetween$38to$46USDperMWhinVietNamandThailand,whilecoalcostsnearly$60USDperMWh.

InIndonesia,thecostofbioenergycanbeevenhigherduetoincinerationandbiomass

technologiesthatprimarilyuseagriculturalwaste,suchaspalmoilresidues.Withaverageovernightcostsforthesetechnologiesreaching

$4,400USDperMWe

,theresultingLCOEcanriseto$87USDperMWh,furtherhighlightingthefinancialchallengesofbioenergy

comparedtootherrenewableoptions.

Auctionpricesshowfallingsolarandwindtariffs

24

Whenlookingatactual

auction

andFeed-inTariff(FiT)rates,bioenergyisnotexperiencingthesamecostreductionsassolarandwind,exceptinThailand.ItisimportanttonotethatwhilebiomasspowergenerationislowcostinThailand,

mosttypesofbiomass

havelow

energydensityandrequirelargeamountstobecollectedforprocessing,whichmayresultinhightransportationcosts,whichisnotreflectedintheauctionprices.

Althoughtheseratesmaynotfullyreflecttruegenerationcostsorincludeexpensesliketransmissioncostsandgridupgrades,theyareusefulforidentifyingtrendsinthe

implementationcostsofthesetechnologiesovertime.

InthePhilippines,bioenergyFiTrateswere

$0.1USDperkWhin2012

,slightlyincreasingto

$0.115USDperkWh

in2024.Malaysia’sFiTratesforbioenergy,includingbiogasand

biomass,haveremainedrelativelystablefrom2012to2024at

$0.066USDperkWh

.

Incontrast,thePhilippines’solar,initiallypricedmuchhigherat

$0.17USDperkWh

in2012,hassignificantlydroppedto

$0.076USDperkWh

basedonGreenEnergyAuctionpricesfor2024installations.SolarratesinMalaysiaalsoplummetedfrom

$0.2USDperkWh

basedonFiTratesin2012toonly

$0.047USDperkWh

by2023installationsfromtheauction

program.Thailand’ssolarFiTratesdecreasedfrom