Thursday, December 1, 2022 — 13.30-16.00 GMT+7ASEAN Centre for Energy (ACE), with support from CETERI (China Energy Technology and Economics Research Institute), organized a virtual Forum Group Discussion (FGD) for the study “Technology Investment Roadmap for Decarbonizing Energy in ASEAN” on Thursday, December 1, 2022. The FGD discussed the significant challenges and mapped out strategies to attract private investment in Renewable Energy (RE) among ASEAN Member States (AMS) in response to the fiscal disruptions after the pandemic.

The Renewable Energy Subsector Network (RE-SSN) and Regional Energy Policy and Planning Subsector Network (REPP-SSN) focal points participated in the discussion to exchange their views and ideas on financing clean energy technologies in ASEAN. Various stakeholders from think tanks, government, and private sectors in the financing, independent supply, and industry also attend the FGD.Opening Remarks

The Executive Director of ACE, Dr Nuki Agya Utama, gave an opening remark to highlight the importance of energy financing and investment to reach the target of a 35% share of RE in the ASEAN installed power capacity by 2025. There is a need for ASEAN decision-makers to nurture enabling regulatory environment to attract adequate investments. However, the fiscal disruption in the post-pandemic era would be challenging for AMS to mobilize additional investment in RE. Therefore, private finance for RE is crucial, but attracting private investment is not straightforward.

FGD Overview

To give an overview of the FGD, Dr. Ambiyah Abdullah, Senior Officer of Energy Modelling and Policy Planning ACE, presented the study objective to explore investment challenges and opportunities in RE toward the decarbonization pathway in ASEAN. Dr. Ambiyah also mentioned to  the participants that in achieving the APAEC Phase II (2021-2025) Target Scenario (APS), total investment in the power sector of US$ 726 billion would be required. Consequently, a more eager involvement of private investors is necessary to meet the target and close the massive gap in the investment ability of the public sector.

Moreover, Mr. Sandy Maulana, ACE Collaborator for this study, introduced a research framework of the ASEAN clean energy finance landscape to provide the right approach for this study. In the research framework, Mr. Sandy further emphasized the significant challenges in clean energy finance from both producer and consumer perspectives from three aspects of focus: fiscal support, regulatory institution, and project readiness.

Panellist Session

In the next session, Ms. Aulia, a representative from the Ministry of Finance of Indonesia, shared Indonesia’s ongoing initiatives in infrastructure financing towards Net Zero Emission. PPP (Public-Private Partnership) scheme successfully delivered 48 projects pipeline with fiscal government support and institutional arrangement. Moreover, Indonesia recently established Energy Transition Mechanism (ETM) under PT SMI (Sarana Multi Infrastruktur) management to promote renewable energy sources through PPP and blended finance schemes.

Mr. Adi Pranasatrya, Sustainable Finance Head of PT SMI, further explained the collaboration with the Ministry of Finance of Indonesia through SDG Indonesia One (SIO). PT SMI manages and facilitates the collaboration to mobilize private sector climate finance to project development. He also stated that PT SMI would improve concrete steps to support climate finance projects in Indonesia.

Furthermore, Mr. Albertus Siagan, Analyst of Climate Policy Initiative, provided us  the details about green financing to achieve decarbonization with the market’s relationship between demand and supply. The dependence on brown sectors makes the low level of green projects because of the profit-oriented business nature. Furthermore, fiscal policies may stimulate  green transition through  creating market demand and increasing incentives for private green projects. Hopefully, fiscal policies could reconstruct incentives and disincentives in the market to motivate  the private sector is more willing to invest into green projects.

Mr. Muhammad Yusrizki, KADIN Net Zero Hub Chairman, explained how Indonesia addressed the Risk Transfer Mechanism (RTM) in financing energy efficiency projects. Although Indonesia has successfully launched a partnership during G20, Indonesia needs also to follow its national target to make the private sector committed to green projects. Moreover, he stated that KADIN Indonesia also communicated with donors, development financial institutions, commercial lenders, and private sectors to achieve decarbonization through a structured finance scheme.

Discussion Session

The member of REPP-SSN and RE-SSN, along with the speakers, participated in the discussion session. The discussion session was moderated by Ms. Amira Bilqis, Associate Officer of Energy Modelling and Planning ACE and Mr. Imaddudin Abdullah, ACE Collaborator for this study. The discussion was formed into  three session; the first was to give commentary on previous sessions, the second was the existing policies from AMS to involve private sectors in the RE investment, and the third was further discussion with the speakers. Many perspectives from different key stakeholders among AMS were gathered as insightful information for the output of the study in designing a technology investment roadmap towards decarbonization in ASEAN.Closing Remarks

Finally, in the closing remarks, Dr. Ambiyah Abdullah, Senior Officer of Energy Modelling and Policy Planning ACE, expressed her gratitude to all participants, including the invited speakers and ACE collaborators, for the productive discussions. She also thanked CETERI for providing this opportunity to conduct the FGD. Hopefully, AMS could engage participation and commitment in drafting the output for the scoping study. The FGD was hosted by Mr. Ghiffari Aby Malik from MPP department of ACE.

(AF/AB)