Countries throughout Southeast Asia have maintained their status as sites for fossil fuel investment, a troubling trend given UN Secretary-General António Guterres’ statement upon release of the recent IPCC’s sixth assessment report: “The alarm bells are deafening, and the evidence is irrefutable: greenhouse gas emissions from fossil fuel burning and deforestation are choking our planet and putting billions of people at immediate risk.”
Meanwhile, in his recent address at the UN General Assembly, President Xi Jinping of China made a commitment to no longer build coal projects abroad—until now, a huge plank in the country’s Belt and Road Initiative (BRI). This promise was couched as a commitment "to harmony between man and nature" globally, as China seeks to limit its CO2 emissions before 2030 and achieve carbon neutrality before 2060. While the BRI has reach throughout the world (an estimated 70 percent of global coal-fired power plants rely on Chinese funding), coal projects have had perhaps their largest impact in SE Asia, including countries such as Vietnam and Indonesia.
After the landmark Paris Agreement of 2015, nations in the region vowed to abide by the accord’s objectives for greenhouse gas (GHG) emissions reductions. The economics of continued investment and subsidies for fossil fuel energy seem counterintuitive, but countries in Asia have growing energy demands to fill and still need some time to transition to greener options.
Nevertheless, a recent report from Oxford University highlights how fossil fuel-generated power—especially coal—is increasingly more expensive than renewable energy competitors. The study reflects a growing market trend that puts polluting, carbon-emitting fossil fuels at a disadvantage against greener, renewable energies like wind and solar. Meanwhile, private investors are flocking to renewable energy options in the region.
And all of this comes on the heels of the historic court decisions requiring fossil fuel companies to factor climate change into their business plans, like those involving Shell and Whitehaven Coal, with implications for other big players in the fossil fuel industry. Further dramatic developments may still be in the offing prior to COP26 in Glasgow, Scotland in October and November. If Xi’s announcement is any indication, further dramatic developments may still be in the offing prior to COP26 in Glasgow, Scotland in October and November.
The drop in costs for renewable energy generation and commensurate rise in cost for fossil fuel power is one reason for the shift (including insurance premiums). Increased awareness about the negative health impacts of power derived from coal, including so-called “clean coal,” petroleum, and natural gas, and global pressure for countries to reduce climate-warming GHG emissions are others.
Some governments argue that natural gas is a uniquely clean form of energy, but its extraction releases methane into the atmosphere—a GHG with much higher heat trapping ability. Natural gas extraction and transport may result in methane leakage and water contamination, even if the energy source’s per-unit GHG emissions are lower than coal. This EJN special collaborative journalism project explores why and how public and private backers are still investing in the fossil fuel economy in Southeast Asia, even as many worry about an economic recovery maintaining nonrenewable power generation at its core. The project’s title comes from the energy investment term “available but not needed capability”; a play on words (of a sort) given many countries’ continued investment in the fossil fuel sector.