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Solar Energy in the Asian Century
Welcome address by Xiaoyu Zhao, ADB Vice President, at the 3rd Meeting of Asia Solar Energy Forum, Shangri-La Hotel, Bangkok, Thailand
Your Excellencies, distinguished delegates, ladies and gentlemen;
I am delighted to welcome you to the Third Meeting of the Asia Solar Energy Forum, or ASEF. On behalf of the Asian Development Bank, I would like to extend my gratitude to our co-hosts: the Government of Thailand through its Ministry of Energy, the Electricity Generating Authority of Thailand, the Natural Energy Development Company, Ltd., Bangkok Bank, Kasikornbank Public Company Ltd., and Siam Commercial Bank.
II. Significance of the Asia Solar Energy Forum in Bangkok
I am very pleased that we meet this week in Thailand, which has taken significant steps to increase the generation and use of solar energy. Thailand's ambitious national renewable energy plan places considerable emphasis on the development of solar energy – estimating that, theoretically, solar resources could power the entire country. Since the plan's introduction in 2009, over 1 GW of capacity has received first–phase approval under a hugely successful solar adder tariff. Thailand is also home to one of the world's largest solar photovoltaic power plants, which many of you will have an opportunity to visit on Wednesday. With the capacity to generate up to an initial 73 MW of electricity and power 70,000 homes, the plant will make a significant contribution to cleaner energy and greener growth.
III. Achieving Asia's Growth Potential – the Lower-Carbon Way
My primary message today is that harnessing the power of the sun to fuel Asia's growth is no longer simply an option – it is a necessity. To put this into context, a recently launched ADB publication suggests that at its current rate of growth, Asia could account for half of global output, trade, and investment by 2050. By then, its citizens may well enjoy widespread affluence. Per capita income will potentially grow to levels comparable to those in Europe today.
But a prosperous future for Asia is by no means guaranteed. Despite a fast recovery from the recent global economic crisis, the region still faces many huge development challenges – not the least of which is the effective management and use of its resources. Some Asian economies are already showing signs of overheating as they return to a path of rapid economic growth, accompanied by accelerating energy consumption and carbon emissions. The situation is aggravated by rising oil prices, especially given the region's overall high dependency on energy imports. This in turn feeds into rising costs of production, transportation and food prices. To sustain its impressive growth momentum, Asia must manage its energy security and innovate away from the traditional, high-resource, high-carbon development path, toward sustainable, low–carbon economic growth.
IV. Diversifying Asia's Energy Mix with Solar Energy
As part of our overall strategy to help developing member countries transition into low carbon economies, ADB strongly supports the development and use of renewable energy sources. We see significant potential for solar energy in particular, given the region's good solar irradiation and large patches of otherwise unusable land.
At present, however, solar energy accounts for less than a quarter of a percent of Asia's overall energy demand. The region's solar-based electricity production capacity is around 500 MW. Through our Asia Solar Energy Initiative, ADB is seeking to increase this capacity 6-fold to 3,000 MW within three years. While this target represents less than 0.5 percent of Asia's total electricity production, it is expected to catalyze the solar energy industry to potentially contribute 3 to 5 percent of total electricity production in the near future.
The International Energy Agency estimates that solar energy could generate at least 20% of global electricity by 2050. With this positive projection coinciding nicely with Asia's anticipated prosperity, we are keen to see Asia and the Pacific as the leader, and not the laggard, in solar energy development. The Asia Solar Energy Initiative is intended to pump prime investments in the region and achieve grid parity sooner rather than later. The initiative is consolidating our efforts to take advantage of the wider adoption of solar technologies, resulting from rapid technological advances, larger scales of production, and lower production costs. It is also responding to the wave of increasing demand from some of the world's largest national solar promotion programs, particularly in China, India and here in Thailand.
Of course, the only way to effectively grow and sustain any industry is to have business lead the process. In fact, all three program components of the Asia Solar Energy Initiative – knowledge management, project development, and innovative finance – are precisely geared towards facilitating and catalyzing public and private sector business participation in the region's solar energy expansion. In this regard, I would like to highlight the contribution of the business sector in organizing this forum. Your participation is vital to ensuring the successful adoption of solar energy across Asia and the Pacific.
V. Expectations from the 3rd Meeting of ASEF
Ladies and gentlemen, whereas the past two ASEF meetings centered on project development and risk mitigation, this meeting will focus on development and technology. We have invited several researchers and technologists to share with us their findings and views of the future.
Over the next two days, we will be introduced to a world of solar energy project development and investment opportunities. We will hear insights from ongoing and proposed projects, highlights from existing favorable policy and regulatory environments, and successful financing solutions. We will cover a range of solar energy applications, from large-scale to off-grid to distributed generation, and consider the solar energy supply chain. We hope that you will leave this meeting with new ideas for broadening the reach of solar energy development across the region.
Earlier this month, in his annual address to ADB's Board of Governors, President Kuroda emphasized that, for Asia to reach its potential for greater, more widely shared prosperity, it is not only the quantity of growth that matters, but also the quality. We look forward to building on our collaboration with all partners to ensure that solar energy is part of the quality solution.
Thank you very much. I wish you all a pleasant morning and a productive two days.