By GHD's Richard Fechner and Dr. Tej Gidda at COP29 in Baku, Azerbaijan
As Asia faces mounting climate challenges and rising energy demands, the push to shift from coal dependency to clean energy is at a critical juncture. The region’s progress in this transition is seen as essential to achieving global climate goals, with nations like Indonesia and Vietnam among the most coal-dependent economies that urgently need to pivot towards renewables.
With world leaders, climate and environmental scientists and business leaders gathering in Baku for COP29 - the 29th Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC) – we’ve been advocating that this transformation poses significant challenges while simultaneously providing opportunities for growth, resilience, and innovation.
Coal remains the largest contributor to climate change, generating 35 percent of global electricity as of 2023. The International Energy Agency’s (IEA) net-zero scenario calls for OECD countries to reduce coal’s share in power generation to 14 percent by 2030, with a complete global phase-out of unabated coal by 2040.
This underscores the fact that achieving global climate goals hinges on a viable energy transition strategy, particularly in Asia, where demand continues to surge.
The need for decarbonisation is stark: Asia’s carbon emissions now account for over half of the global total. The young age of Asia’s coal fleet - about 13 years on average -complicates the shift to renewables, with significant investments still tied up in coal plants. According to the World Economic Forum, policies that streamline and incentivise plant closures or conversions can accelerate the pace of transition.
Transitioning to renewables in Asia requires not only technological shifts but also robust financial mechanisms.
We need financing models that incorporate public and private capital, with mechanisms like loans and grants making clean energy more accessible and competitive.
Countries like Vietnam face hurdles such as rigid power purchase agreements that protect coal plants from competition. Overcoming these barriers demands innovative financing, potentially reducing the cost of capital to make renewable projects more viable and less risky.
The move from coal to renewables also requires securing grid stability and resilience. The diversity of resources across Asia - from hydropower in Southeast Asia to solar in China - necessitates tailored strategies for integrating these resources into a cohesive and stable energy grid. GHD is actively involved in helping clients navigate these complexities by advising on technical planning, decommissioning, and the use of renewables like solar and wind.
Based on this, there are three critical pillars for a successful transition: stable technical solutions, sustainable stakeholder engagement, and a strong business case. Every project requires bespoke planning that integrates stakeholder interests, addresses environmental impacts, and leverages technical expertise to ensure grid reliability.
A well-defined transition strategy that supports all stakeholders and secures financial backing is essential for a viable energy future.
Creating such a strategy involves evaluating the potential of each project and exploring repurposing opportunities, from battery storage to hydrogen production.
Richard Fechner is the Executive General Manager of GHD Advisory, leading the global business in providing strategy, commercial, economic, business case, logistics, policy, regulatory, asset management, and transaction services. With over 30 years of experience, Richard has held senior roles in both the private and public sectors, contributing significantly to infrastructure development, investment, and delivery across various sectors including ports, agriculture, energy, government, and defence. He has advised on approximately AUD150 billion in infrastructure transactions and is a highly skilled infrastructure and business professional with expertise in strategic planning, business management, and project engineering.
Dr Gidda is a distinguished expert in clean energy transitions and currently serves as the Global Leader for Future Energy at GHD. With over 20 years of industry experience, Dr Gidda holds a PhD in Environmental Engineering and is a registered Professional Engineer in Ontario. His work focuses on integrating clean energy technologies into existing systems and developing innovative strategies to overcome challenges related to reliability and affordability. Dr Gidda's expertise spans hydrogen, renewable natural gas, traditional renewables, energy from waste, energy security, and planning. He is also an adjunct professor at the University of Waterloo.
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GHD es una empresa líder en servicios profesionales que opera en los mercados mundiales de agua, energía y recursos, medio ambiente, infraestructura y edificaciones, y transporte. Comprometidos con la visión de garantizar que el agua, la energía y las comunidades sean sostenibles para las futuras generaciones, GHD ofrece soluciones en consultoría, servicios digitales, ingeniería, arquitectura, medio ambiente y construcción a clientes del sector público y privado. Fundada en 1928 y propiedad de sus trabajadores, GHD cuenta con una red de más de 12.000 profesionales en más de 160 oficinas en cinco continentes.
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