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Sabrina Moles published in Asean, Global Lens

Asia and energy: how green is the East?

The energy transition is everyone's duty, but perhaps for the Asian continent it is a little more so. Why does the development of Asian countries interest observers so much?

The world of tomorrow is already in Asia. But also the climate crisis, economic and social inequalities, and the exploitation of resources. The search for immediate and concrete solutions to counter the environmental crisis is an established imperative, and no place in the world has more eyes on it than Asia. Although the big polluters reside in the global north and China, the rest of the more backward East also worries observers. In this part of the world, the population is growing, individual welfare standards are rising, and funding for housing and infrastructure is pouring in - all of which threaten to repeat the pollution patterns of recent decades.

Energy has quickly become the keystone on the table of those "concrete answers" that governments must develop within the next few decades, on pain of increasing emissions that are at the root of global warming. The so-called climate-altering emissions are responsible for the greenhouse effect and are only minimally attributable to the normal functions of the Earth's ecosystem. Excluding the curiosity for which water vapor is classified as the greenhouse gas most present in the atmosphere (an effect generated in turn by rising temperatures), we are talking mainly about carbon dioxide (CO2) and methane (CH4). These emissions are largely due to the production systems and standards of living of advanced countries, which in turn depend on energy sources.

Fonte: International Energy Agency (Iea)

As simple as it may sound, tackling a revolution in energy systems is a very complex operation that goes beyond the pure field of technological innovation. It is about changing the paradigm in the name of efficiency and "artificially" pushing diplomacy, markets and communities towards a single goal: emission-free development. Or almost. Today's objective, consolidated by international climate tables, is to succeed in offsetting the output of climate-changing gasses by offsetting their impact (with natural or technological solutions), and lowering the quantity in the most polluting sectors. In the Asian region, the process of transition to more sustainable and clean forms of energy becomes an even more multifaceted discourse, where the (almost) clean slate of the power grid in Myanmar shares the same continent as China's fourth-generation nuclear reactors.

Energy demand in Asia is set to double by 2030, and already accounts for about half (53%) of global demand. If in 1966 the GDP per capita of developing Asia was 330 dollars, today it is close to 5 thousand dollars. These are just two of the figures that focus the attention of observers on the Asian continent, where the production lever is being met by new consumption needs. But it also raises the concerns of experts, who fear that it could host the ploys of large multinationals to reduce their carbon footprint in the country of origin. Asia today continues to focus on economic growth driven by exports and traditional development models, and is slowly trying to emerge from the stagnation of the Covid crisis: assumptions that for skeptics validate a still uncertain future for the transition to "truly" sustainable development.

Fonte: International Energy Agency (Iea)

Despite the pandemic setback, emissions will continue to rise, and are about four times higher today than they were in 1960. To return to acceptable levels, according to scientists at the Intergovernmental Panel on Climate Change (IPCC), all countries would have to undergo the 2020 halt every year for decades to come. This brings into the balance the big polluters, such as China and the United States, but also the countries that are growing faster according to the same paradigms: Southeast Asia, Central Asia affected by the projects of the Belt and Road Initiative (Bri) and of course East Asia that has been driving the economic success of the "Far East" for thirty years. The history of the Four Asian Tigers is emblematic of this growing parabola, which, together with profits, has hosted and relaunched large global production centers. Today, in this part of the world, there is also a growing demand to raise the living standards of citizens, which in the eyes of governments often translates into ambitious prospects for growth in domestic consumption. To produce, and to live the life of the "ideal consumer", energy is needed.

Fonte: Fondo Monetario Internazionale (Fmi)

In this large mosaic of 4.4 billion people and 58 countries, the presence of China alone distorts the data on the environmental impact of energy systems in Asia. On the other side of the spectrum, we have 1/10 of the population that does not yet have access to electricity and relies on biomass combustion for cooking and heating. And the next step is granted by access to fossil fuels: since 2010, for example, over 450 million people in India and China have switched to LPG. 

Finally, there is the mirage of energy efficiency from renewable sources, which has long been considered one of the necessary solutions by major agencies such as the International Renewable Energy Agency (Irena) and the International Energy Agency (Iea). In a joint report, the two institutions have denounced how most countries are still underestimating the efficiency aspect applied to civil and industrial heating and cooling systems, which represent 40% of global emissions. It is one of the many facets of the energy transition that could see an advantage for those Asian nations that do not yet have consolidated energy systems and an electrical grid that needs to be extended rather than rebuilt. But it also poses new challenges: climate change will increasingly test the resilience of new infrastructure, in a part of the world where rising seas threaten millions of people and entire states (especially on islands). Increasingly frequent heat spikes and droughts are sending the power grid into a tailspin where hydroelectric capacity is lacking or the grid cannot sustain the demand for cooling energy.

In recent years, bilateral and multilateral agreements to implement new, more sustainable energy systems have multiplied, while countries promise to achieve net emissions within the next 30-40 years. Thus, increasingly defined legislation has emerged to lower emissions, improve access to more sustainable technologies and propose market measures that can divert investment towards the energy transition. Asia remains the region where coal continues to expand rather than shrink, but soon lower renewable energy prices, investor pushback and legislative pressure could reverse this trend. There is no shortage, and will be no shortage, of instances of imbalance on energy networks and markets (including labor markets): the energy transition is not a gala dinner.

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Redazione published in Global Lens

Energy transition goes through smart systems

The intention for the integration of renewable and more sustainable solutions is there, but it may not be enough: to address the complexity in managing the energy grid of the future, APAC will not be able to do without smart control systems that operate between supply, grid, demand and storage, making the process more efficient, reliable and secure through interconnection.

Article written by Fabrizia Candido

The Asia-Pacific region, also known as APAC, is home to 60 percent of the world's population (about 4.3 billion people) and produces about half of the world's carbon dioxide emissions. In addition to China, India and Japan (three of the six countries most responsible for CO2 emissions), the region is home to some of the fastest growing economies in the world. In fact, by 2040, APAC's fuel energy demand is expected to reach 43.6 petawatts, with global demand reaching 197.8 petawatts. The need to decouple economic growth from GHG emissions is therefore urgent. 

Accelerating the transition to widespread, affordable, low-carbon energy supply requires greater optimization of every aspect of the energy system, as well as greater coordination and cooperation among each component. This requires better understanding and improved mechanisms to monitor and control the ways in which power grids, buildings, industrial facilities, transportation networks, and other energy-intensive sectors integrate and interact with each other.

The future power system will accommodate more power from intermittent generators (solar panels produce power only when the sun shines and wind turbines only when the wind blows), and it will be more decentralized: there will be many more physical assets connected to the generation and distribution networks, where energy flows will become increasingly dynamic and multidirectional. The complexity of the power system will increase significantly. This could put the stability and performance of the grid at risk, leading to issues such as frequency imbalances, blackouts, brownouts and capacity overload. Without real-time data, advanced analytics and automation, the most complex power systems of the future will become virtually impossible to manage.

That's where digitization comes in, with data collection and analysis, artificial intelligence and machine learning. The addition of huge amounts of variable energy sources has created the need for smart control systems that operate between supply, grid, demand and storage, making it all more efficient, reliable and sustainable through interconnection.

More specifically, the growing wealth of information generated on energy consumption and production patterns can be used to better plan for the transformation of the industry, both at the macro and micro levels: data monitoring and analysis allows for better predictive ability of renewable energy production, enabling optimization of the entire supply chain. Using data collected from various sources, such as electricity consumption data, electricity price data, and weather data, artificial intelligence can also be used to recognize patterns and/or provide probabilistic predictions about energy production capacity, demand, or shortages. 

In short, digitization provides an opportunity to leverage the availability of data to optimize the energy transition.

In 2020, Australia launched its Distributed Energy Resource Register, a registry that provides a database of information about Distributed Energy Resources (DER) devices installed in the national electricity market. The registry collects information critical to the Australian Energy Market Operator's (AEMO) DER program. The interconnection between DER devices and the registry allows AEMO to better manage the electricity grid and ensure reliable, secure and affordable energy for all customers.

Another example of digitization in the service of energy optimization comes from India: the Indian government has developed the India Energy Dashboards (IED), an open source portal that collects data and monthly reports on the country's electricity, oil and natural gas usage. The Indian government also created the Building Energy Efficiency Program Dashboard, with the goal of encouraging the use of energy-efficient devices in residential structures by raising consumer awareness. The online database shows in real time the number of lights installed by region, along with their respective annual cost savings, annual CO2 reductions and avoided peak demand.

Again, since 2013, the Chinese government has also prioritized online energy monitoring systems. Public sector buildings at all levels of government have implemented such systems to obtain real-time data, enabling automation of energy management and a transparent method of assessing the energy efficiency of facilities. Most online energy monitoring systems for China's public sector are currently decentralized systems. For example, the Hangzhou local government, together with Alibaba Group, implemented the City Brain project to improve energy efficiency in transportation. Under the project, a cloud platform captures images from interconnected street cameras, translates them into traffic data, analyzes the results, and provides the most efficient solutions via algorithms, which are then redirected to smart tools such as smart traffic lights. This has reduced traffic congestion in the city of Hangzhou by 10 percent, with implications for pollution levels and fuel use.

Finally, on a larger scale, the Singapore government recently completed a full-scale digital model of the entire city, Virtual Singapore, which includes 3D digital replicas of every building in the city. For urban planners focused on energy efficiency, the digital twin city offers the ability to accurately simulate how new developments and planning changes in the city might affect a range of energy-related indicators, including solar radiation, road and pedestrian traffic flows, heating and cooling, and other factors. Given the city's size limitations, the digital model provides an extremely useful system for testing real-world planning interventions.

In conclusion, the APAC region has come to realize that on the route to the mammoth goal of energy transition, it will not be possible to do without the many and varied smart solutions that digitization and data availability make possible.

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Redazione published in Global Lens

India and China: solar revolution (and competition)

New Delhi and Beijing are not only competing for the markets of their solar modules: their low costs of solar energy production, if combined with interconnection capabilities, can transform the Tiger and the Dragon into all-round "electrostates".

By Marco Dell'Aguzzo

Mukesh Ambani is the tenth richest man in the world and first in the list of billionaires in Asia. His wealth is linked to the fortunes of Reliance Industries, the Indian conglomerate famous above all for its petrochemicals: gas and crude oil, therefore. But Reliance, like almost all the big names in the hydrocarbon sector, has also embraced the energy transition and announced that it wants to reach net zero carbon emissions by 2035. The phrases speak for themselves, and there is no need to add much more: it is clear that behind the climate projects of big industries and big paper money there is not only the desire to participate in "saving the Earth", but above all that of reaffirming their economic presence in a changing world. And that, in the course of this change, will burn fewer and fewer fossil fuels and use more and more renewable sources. We are the ones who give energy a political dress. But in the mind of an entrepreneur thinking about selling, net of profitability, a barrel of oil is not too different from a solar panel.

On October 10, Reliance made it known that it had purchased a Norwegian solar panel company from Chinese chemical company Bluestar for $771 million. A couple of days later, with 28 million it acquired the technologies of a German company that produces wafers (semiconductors) for photovoltaic cells. Within three years - these are the plans - Reliance will have invested 10.1 billion in clean energy, and by 2030 will have a solar capacity of at least 100 gigawatts, equal to the entire installed renewable India today.

The New Delhi government wants renewables to reach 450 GW by the end of the decade. Solar potential, in particular, is high, but currently only 4 percent of the electricity used in the country is generated from this source. Coal's share, by contrast, is huge, at more than 70 percent. It won't be this way forever, though. This is not said by a young activist from Fridays for Future but by the president of the state-owned mining company Coal India, the one that extracts the most coal in the world. It's a sector that will shrink in twenty to thirty years, says Pramod Agrawal, to make room for solar energy: Coal India plans to enter the photovoltaic wafer business, leveraging the fact that Indian factories produce cells and modules, but not these essential semiconductors.

The competition has just begun. Because Coal India's aim is also that of Reliance, which aims to make the country a large manufacturing hub of cheap but efficient solar panels, capable of conquering the market share of China (now the largest, clearly): it starts with an "integrated photovoltaic gigafactory" of 4 GW per year, which will become 10. Ambani's appetite is also shared by Gautam Adani, the billionaire chairman of the Adani Group, a company that deals in coal trading but will move on to add millions of renewable watts year after year. The government is participating in this industrial effort by raising barriers to the entry of solar modules and cells from abroad, with duties of 40 and 25 percent respectively starting next April.

Most PV equipment comes to India from China. Which, while strong in its advantage, is not just watching the moves of its regional rival, but is also trying to ride the global sustainability revolution. Last month, President Xi Jinping announced that the country had begun construction of a renewable mega-project in an undefined desert, the first phase of which (100 GW) exceeds India's entire wind and solar capacity. But to achieve carbon neutrality by 2060, as it says it wants, the world's largest greenhouse gas emitter will have to succeed in easing its dependence on coal. Similar to the Indian case, solar can be an effective substitute. Also because - according to a study by Tsinghua, Nankai, Renmin and Harvard Universities - by 2023 the prices of the two sources will be similar all over the country: in the northern and eastern areas the break-even will be reached already in 2021; while in the center, in the south and in the north-west in 2023. When combined with storage, solar could meet more than 40 percent of the country's electricity needs by 2060, without compromising grid stability and at a cost of as little as 2.5 cents per kilowatt hour.

Solar power tariffs in India are already very cheap: in the west-central state of Gujarat, for example, they have dropped below two rupees per kilowatt hour (about 2.6 cents on the dollar) and could halve by 2030. By that date, consulting firm Wood Mackenzie estimates that coal's wedge in the mix will be 50 percent and that building new power plants powered by the fuel will be 25 percent more expensive than solar plants. The International Energy Agency says that in 2040 - just nineteen years from now - the shares of coal and solar will be equal, and the nation will be able to rely on 140-200 GW of new battery capacity.

Tight timeframes but huge numbers, like ambition. India and China aren't just competing for markets to sell their solar modules: their low solar production costs, when combined with interconnection capabilities, can turn the Tiger and Dragon into well-rounded "electrostates" capable of generating and exporting large amounts of clean, cheap electricity to Asia. New Delhi is already building grid infrastructure with Bangladesh and Nepal; in 2016, Beijing established GEIDCO to reach as far as Africa and South America. It is not certain that these desires will come true; we are still in the space of the possible: to assert themselves abroad, the two neighboring powers will first have to succeed in meeting domestic needs. But energy, whether renewable or fossil, remains a question of geopolitical power.

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