The ASEAN region has a lot of drivers for becoming a solar power hub and is a front runner for renewable energy investors. The drivers for growth of the solar power energy in ASEAN include:
1. High electricity demand: This region has a combined nominal GDP of USD 3.11 trillion which is steadily growing at >5% P.A. over the last 10 years. This growth in the region contributes to increasing demand of electricity.
2. Need for additional power generation capacity: many parts in the region still remain unelectrified. The power generation capacity of the region has grown more than 6% per annum on an average. Solar energy capacity in ASEAN will rise from 23.1 GW in 2020 to 76.5 GW by 2025.
3. High global horizontal irradiation levels - The GHI levels are high across ASEAN countries, with most areas exhibiting GHI levels above 1,600 kWh/m2. Southern Indonesia has the highest GHI above 2,000 kWh/m2 and lowers levels are in North Vietnam around 1,000 kwh/m2.
4. High power generation costs - Power g
eneration in ASEAN is highly dependent on fossil fuel sources. This calls for countries to start generating power using renewable energy. While Europe has around 38% power generated through renewable sources, ASEAN had less than 20% generated through renewables and this number has to increase in the foreseeable future.
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