Jakarta, 20 August 2024: As global temperatures rise and natural disasters become more frequent, the urgency to address climate change has intensified. The Asia Zero Emission Community (AZEC) remains committed to achieving carbon neutrality without hindering economic growth. This commitment was reaffirmed during the AZEC Advocacy Group Round Table meeting held at St. Regis Jakarta on 20 August 2024.

ERIA President Tetsuya Watanabe emphasised the significant responsibility of the AZEC ministers in formulating policies to help Asia and ASEAN countries reach net zero. 'AZEC is committed to leading global efforts towards zero carbon emissions. We will strengthen communication with stakeholders, including governments and the private sector, to ensure a shared understanding of this decarbonisation roadmap,' said President Watanabe.

President Watanabe also underscored the growing energy demand in ASEAN, driven by population growth, economic development, and the expansion of artificial intelligence (AI) usage. He highlighted that ASEAN must ensure an adequate energy supply while continuing to pursue decarbonisation without hindering economic growth.

Fossil fuels continue to be the primary energy source in many ASEAN nations, leading to increasing carbon emissions. As a result, it is essential for AZEC ministers to lead the shift towards clean, renewable energy.

'There are various options for decarbonisation, but each comes with its own challenges. We need to coordinate with markets to attract investment in zero-carbon energy sectors,' President Watanabe added.

Takashi Uchida of Keidanren expressed hope that this issue would become a top priority for Asia and ASEAN countries. He anticipated that the second Advocacy Group Round Table Meeting would produce concrete proposals to drive carbon emission reductions in each country. 'The points discussed in this meeting will be shared with each country, as each has its unique energy needs,' Uchida stated. He also mentioned that a memorandum of understanding (MoU) would be signed to establish systems supporting zero-carbon sustainability in each country.

Arsjad Rasjid from ASEAN Business Advisory Council (ASEAN-BAC) Indonesia reaffirmed Indonesia's commitment to the international zero-carbon agenda as part of AZEC. He noted the significant economic growth opportunities in the zero-carbon sector and emphasised the need for a shared understanding in achieving energy transition. 'Global climate change should be a collective concern, and we must view it as an opportunity,' said Arsjad.

Arsjad also highlighted the importance of security in developing zero-carbon energy sources and expressed hope that AZEC would be the voice of the business community in this energy transition. 'Indonesia greatly appreciates AZEC's efforts in promoting zero carbon, and we are ready to make this a joint action for Asia and ASEAN,' he added.

Dr Han Phoumin, Senior Energy Economist at ERIA, projected that fossil fuels will still account for around 60% of energy demand in 2050. 'About 20% of fossil fuel use will be decarbonised through Carbon Capture and Storage (CCS) technology. Given that the industrial and transportation sectors will remain major fossil fuel users, decarbonising these hard-to-abate sectors is paramount,' Dr Phoumin explained.

He also warned that continued reliance on fossil fuels would conflict with the Paris Agreement and the Glasgow Climate Pact. In the journey to carbon neutrality, renewable energy sources like solar, wind, and biomass are expected to make significant contributions by 2050, alongside clean energy options such as hydropower, geothermal, and nuclear.

ERIA and The Institute of Energy Economics, Japan (IEEJ) have conducted simulations on cost-effective energy technologies to achieve carbon neutrality by 2060 in ASEAN. ERIA collaborates with interested ASEAN countries, including Indonesia, Thailand, and Viet Nam, to develop individual scenarios. These scenarios incorporate the use of solar photovoltaics; offshore and onshore wind; hydropower; geothermal; biomass; nuclear; carbon capture, utilisation, and storage (CCUS); hydrogen; ammonia; direct air carbon capture and storage (DACCS); and bioenergy with carbon capture and storage (BECCS) combined under various assumptions.

'In the short to medium term, efficient gas-fired power generation will help reduce CO2 emissions from fossil fuel-based power plants. Around 300 megatonnes of CO2 could be reduced by 2050 through a shift from coal to gas in ASEAN. In the long term, CCUS technology, co-firing with ammonia or hydrogen, and the use of 100% ammonia and hydrogen will play crucial roles,' Dr Phoumin concluded.

Given the continued significant role of fossil fuels in ASEAN's energy mix, Dr Phoumin highlighted the need for technology that supports early, partial, and deep decarbonisation of fossil fuel-based power generation.