Asia’s Growing Renewable Energy Capacity is a Bullish Sign for Investors

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Asia’s Growing Renewable Energy Capacity is a Bullish Sign for Investors

According to The International Energy Agency (IEA)’s ‘Renewable 2019’ report, renewable energy capacity is set to expand 50% between 2019 and 2024. Source: Earth.org

25 May 2021 – by Eric Koons   Comments (0)

Asia makes up the lion’s share of global renewable energy (RE), which will continue to create many investment opportunities. In 2011, the total global renewable energy capacity was 1,329,886 megawatts and by 2020 it had grown 110.5% to 2,799,094 megawatts. Asia’s renewable energy capacity accounted for 46% of the global total in 2020, followed by Europe (21.8%) and North America (15.1%).

Breakdown of global use of hydro, wind and solar power

The highest share of renewable energy is still generated by hydropower, but wind and solar are gaining. The breakdown sits at:

  • Hydropower = 43.3%
  • Wind = 26.2%
  • Solar = 25.5%
Global renewable energy capacity by energy source (2007-2017)

Renewable Energy in Asia – Asia is leading the way

China’s Renewable Energy Capacity

From 2011 to 2020, China’s total renewable energy capacity grew by 234% and accounted for the vast majority of Asia’s total RE capacity (69.6%). China’s total RE capacity comprised of hydropower (38%), wind (31.5%), and solar (28.4%). By 2030, China is aiming to increase its primary energy consumption of renewables. It has its sights set on 20% by 2030 and 50% by 2050.

China's current climate goals work towards achieving net-zero status by 2060.

Sustainable Energy Generation in India

India also contributed significantly towards Asia’s total renewable energy capacity. Their RE capacity sat at 134,197 megawatts in 2020 and they are aiming for 175,000 megawatts by 2022. Within the last five years, India’s energy policies have been particularly supportive of renewable energy. This has created significant tailwinds, which are expected to carry RE growth in their energy sector through the coming decade.

Japanese Officials Promoting Sustainable Energy

Japan has reported significant growth in total renewable energy capacity, increasing by 171.1% from 2011 to 2020. Government policy played a significant role in this transition. Policies include the implementation of renewable energy quotas for electric power retailers and solar subsidies. Along with their landscape adequately suited to take advantage of offshore wind across the region, Japan has much potential for RE in their energy mix In 2020, Japan accounted for 7.9% of Asia’s total RE capacity.

Japan's policies have helped fuel renewable energy growth over the last decade.
Source: Expert Investor

Vietnam’s Exponential Growth of Renewable Energy

Vietnam has seen some of the largest growth of Renewable Energy in Asia, with an increase of 248.1% since 2011. Despite rapid growth in wind energy deployment, most of its total RE capacity growth has been from solar power and hydropower.

Vietnam a leader in southeast Asia in sustainable energy

Vietnam will likely become a leader in sustainable energy for Southeast Asia. We expect many of these polices will be highlighted in their upcoming Power Development Plan 8 (PDP8).

Vietnam is the leader of renewable energy capacity in Southeast Asia.

How Renewable Energy is Used in Asia

Many Asian countries are moving beyond just power generation and are promoting other zero to low carbon emitting technologies.

The Boom of Electric Vehicles

China’s central and regional governments have adopted polices for a zero-emissions vehicle mandate. It provides subsidies and benefits for electric vehicles and buses. As a result, by mid-2019, China accounted for nearly half of the world’s electric cars and 99% of the electric buses.

China is the global leader in electric vehicles.

South Korea’s government is promoting electric vehicle innovation through adopting goals to increase the number of “environmentally friendly” cars on its roads. The private sector has benefitted by developing new business models (e.g.: battery leasing), building new electric charging stations, and receiving a variety of financial support.

What Renewable Energy Growth Means for Investors

Renewable energy in Asia has increased at a significant rate over the last ten years. With the correct policy, and funding, we expect this trend to continue in the coming decades. China is leading the way with its commitment to achieve net-zero emission by 2060. Other Asian countries, including India, Japan, Vietnam, and South Korea, are also expanding local renewable energy capacities and energy access.

These trends are creating new and emerging investment opportunities throughout Asia for renewable energy and non-fossil fuel-based technologies. Moreover, consumers of sustainable energy-based technologies are benefiting from increased energy access and by taking advantage of subsidies, tax breaks, and other advantages (e.g.: free and preferential parking).

Asia has most of the worlds renewable energy

by Eric Koons

Eric is a passionate environmental advocate that believes renewable energy is a key piece in meeting the world’s growing energy demands. He received an environmental science degree from the University of California and has worked to promote environmentally and socially sustainable practices since. Eric’s expertise extends across the environmental field, yet he maintains a strong focus on renewable energy. His work has been featured by leading environmental organizations, such as World Resources Institute and Hitachi ABB Power Grids.

Read more

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