As the emerging markets of Asia become the new darlings of the world economy, their influence has spilled over into the field of clean energy as well.
Less than a decade ago, the landscape for clean energy in Asia could not have looked more different than it does now.
Then, the booming Asian economy came with the by-products of sulphur dioxide emissions that choked the air and soaring chemical oxygen demand levels that permeated the water.
From the fallout of economic growth, a turning point appears to have emerged. The same engine of economic growth is increasingly running on clean energy.
For the first time last year, financial investment in clean energy firms and utility-scale projects in Asia and Oceania - US$40.8 billion - exceeded that of the Americas - US$32.3 billion, according to a report commissioned by the United Nations Environment Program’s division of technology, industry and economics (DTIE).
Of the lot, the clear primary beneficiary of funds has been the solar power sector.
At the same time, investment of the same kind declined 10 per cent year on year in Europe, to US$43.7 billion.
Astounding growth
The rate of growth for the field in this region is astounding in itself. From 2004 to 2009, the compounded annual growth rate for sustainable energy investment came to 61 per cent, compared to the global average of 46 per cent.
The momentum has also continued into 2010 - for the first six months of the year, new financial investment in clean energy stood at US$65 billion globally, a 22 per cent surge year on year. Tellingly, the bulk of it took place in an Asian powerhouse - China.
Of the lot, the clear primary beneficiary of funds has been the solar power sector - from 2004 to 2009, the financial sector’s new investment in solar energy grew the most, at a compounded annual growth rate of 107 per cent.
Even then, other numbers show that the clean energy sector has plenty to be excited about.
Last year, efficient technologies which include that of electric vehicles and efficient lighting raked in the most venture capitalist and private equity funding - US$2.1 billion, globally.
In Singapore, where the focus remains on the research and development aspects of renewable sources of energy, efficient technologies have demonstrated relatively greater practical potential.
Already, two out of the five projects being awarded funding from a S$10 million allocation from the Energy Market Authority’s Smart Energy Challenge programme will be based on developing the infrastructure and components of electric vehicles.
Another two projects will be looking at how energy efficiency in Singapore can be boosted.
The programme itself is part of a larger S$25 million Energy Research Development Fund that will go towards increasing the diversity of the country’s energy sources and reducing energy intensity.
The case for government involvement in clean energy is becoming increasingly clear as literature on the matter filters through.
Clear relationship
A report by the United Nations Environment Program and the SEF Alliance last year stated that there is a clear relationship between energy efficiency and economic prosperity.
There was also evidence to show that government spending on green stimulus programmes was more effective in creating jobs compared to spending the same amount on traditional alternatives.
As the region hurtles inexorably towards cleaner and renewable sources of energy, a combination of the responsiveness of commercial interest and the precision of good policy-making will be crucial.
