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Corporate demand for renewable energy has been growing and is
forecast to log at least a 100-fold increase over the coming decade
in Southeast Asia. Southeast Asia's commercial and industrial
(C&I) sector power demand is forecast to rise from 600 TWh in
2020 to 933 TWh over the coming decade. In 2020, RE100 members
recorded nearly 5 TWh of power consumption in Southeast Asia, with
only 7% currently from renewable sources, despite their commitment
to renewables. With 56% of the RE100 members having operations in
Southeast Asia, the 100% renewable target year drawing closer,
operations growing in this region of strong economic growth, and
RE100 and similar initiatives proliferating, the demand for
renewables will undoubtedly rise as well.
With the growing demand for renewable energy and high energy
density businesses, on-site rooftop generation may not be able to
provide sufficient electricity to meet energy needs and help
corporations to achieve 100% renewable energy. The corporate
renewable procurement options available in Southeast Asia vary
greatly between markets and are dependent on power market
liberalization status and market structures. However, one common
theme is that all markets in the region are taking steps to
introduce more corporate renewable procurement options to ensure
that access to renewable energy improves to remain attractive to
corporations looking to set up operations overseas and to achieve
national renewable targets. Markets are opening more options
through liberalizing the electricity retail segment and other
innovative solutions such as peer-to-peer trading of renewable
energy.
The price for off-site renewable procurement is going to be high
in the near term for countries with a lack of supply and limited
procurement options. By 2025, IHS Markit expects that renewable
buyers in Malaysia, Singapore, and Vietnam will start to see prices
decline and a trend toward the levelized cost of electricity of the
respective renewable source or the cost of supply. This would
likely be the result of more procurement options to better match
the demand and supply for renewables, and, in Singapore's case, an
increase in renewable imports.
