I’m here at the Asia Clean Energy Forum in Manila, Philippines, where more than 1,500 leaders from 63 countries are sharing their insights, innovations and lessons learned in our collective efforts to drive a clean energy transformation. This preeminent gathering is truly inspiring, steeped in the passion, dedication and determination of so many people working toward a common goal – achieving universal energy access and climate change targets for Asia’s clean, equitable and prosperous future.
On Monday morning, in a packed auditorium with standing room only, we invited top leaders to the stage in a deep dive workshop that addressed a critical issue on everyone’s minds – how to accelerate private sector clean energy investment and finance in Southeast and South Asia to unlock the economic, social and environmental gains that power globally competitive and sustainable societies.
The Power of Private Sector Leadership
Asia is a powerhouse of global economic growth, and increasingly, Asia is leading in our global progress to address climate change. Governments in Southeast and South Asia are committed to implementing their national climate change targets under the Paris Agreement and are actively working to reduce greenhouse gas emissions, while also meeting increasing energy demands.
Leading corporations here have embraced the business case for clean energy and ambitious climate action as well. Some top examples include:
- Ayala Land Inc., the Philippines’ leading developer of sustainable estates, announced in February its goal to be carbon neutral – to achieve a net-zero carbon foot print – by 2022.
- AMATA Corporation, the leading developer of industrial cities in Thailand and Vietnam, prioritizes clean energy, water efficiency and other environmental measures to fuel both corporate growth and green development.
- Mahindra & Mahindra, the world’s largest tractor manufacturer and India’s top tractor maker, increased funding of clean energy and other environmental projects 10-fold in recent years through innovative internal incentives that make the business case for sustainability.
- The Vietnam Business Forum, comprised of leading Vietnamese and multinational companies, delivered in October it’s Made in Vietnam Energy Plan to government officials, conveying in a unified voice key policy needs to enable private sector clean energy investment at scale.
- And 96 global companies have now joined an initiative called RE100, pledging to fuel their operations with 100 percent renewable energy. Many of these leaders – including Apple, Amazon, Google, IKEA, Mars, Microsoft, Nike, Proctor & Gamble, Unilever, Walmart and others – have extensive operations and supply chains in Southeast and South Asia and aim to significantly increase their investments in renewables here in the coming years.
Corporate demand for clean energy has the potential to catalyze change in the energy sector much more broadly, as we’ve seen in the United States, Europe, and elsewhere. In Asia’s dynamic markets, however, companies with supply chains spanning multiple countries often face challenges in meeting their clean energy goals.
At the same time, national and subnational governments are seeking financing to scale up clean energy deployment. As a result of this disconnect, public and private sector leaders are missing opportunities to meet their respective targets, secure cost-effective energy supplies, support local job creation, and together foster greater societal health and economic wellbeing.
Looking ahead to 2018, when the world will take stock of our collective progress under the Paris Agreement, the time is right to strengthen public-private sector collaboration aligned with shared goals.
Public-Private Sector Collaboration to Power Asia’s Clean Energy Future
In key markets – including India, Indonesia, Philippines, Vietnam and others – many government leaders are asking for clear signals from the private sector on what’s needed to accelerate private investment and finance for a clean energy future.
In March, the USAID Climate Economic Analysis for Development, Investment, and Resilience (CEADIR) Activity and our partners convened top corporate and government leaders from Southeast and South Asia to identify near-term actions that will enable private clean energy investment at scale. At a regional level, recommendations from corporate leaders to governments fell into three key themes.
- Improve the policy and regulatory environment for clean energy investment – including
- Reviewing and revising existing policies and regulations that currently conflict with renewable energy development goals or create market uncertainties for investors;
- Instituting new policies and incentives that provide clear direction for private sector investment in renewables;
- Preparing actionable energy sector plans, with clear targets for renewables; and
- Improving electricity price foresting and allow cost-reflective tariffs that consider changing technologies and enable renewables to compete.
- Strengthen the finance environment for clean energy development – including
- Developing the capacity of domestic commercial banks to increase clean energy lending and obtain additional capital; and
- Helping domestic clean energy project developers access more finance.
- Increase government capacity and public-private sector collaboration – including
- Improving government capacities at national and subnational levels to support and promote markets for renewables;
- Increasing government engagement with various private sector stakeholders to understand their needs and priorities; and
- Increasing collaboration between government agencies and the private sector on strategic pilot or demonstration projects as proof-of-concept to open the door for greater investment.
Corporate leaders also developed country-specific recommendations for these key markets, delivering a unified message to governments on how they can enable private sector investment at scale. In response, governments identified priority actions to lead and promote in their countries in the coming year. In connecting with many of these leaders again here at the Asia Clean Energy Forum this week, I am excited to see momentum build on these recommendations.
The full report from the USAID CEADIR clean energy workshop in March is available on the USAID Development Experience Clearinghouse. More information about the deep dive workshop at the Asia Clean Energy forum is available here.