Wind Sector in Southeast Asia Needs $14 Bn in Investments by 2030: WoodMac

According to a new analysis, the wind power sector in Southeast Asia requires at least USD 14 billion of investments by 2030.

According to a new analysis, the wind power sector in Southeast Asia requires at least USD 14 billion of investments by 2030. This is to support the 8.9 gigawatts (GW) of new wind power capacity that is expected to be added between 2020 and 2029, according to Wood Mackenzie.

With a population exceeding 650 million and average annual power demand growing at 8 percent until 2030, Southeast Asia is one of the world’s fastest growing power markets. To support this growth, the region’s governments are setting renewable energy targets to diversify their energy mix to be more energy self-sufficient.

Wood Mackenzie principal analyst Robert Liew said “currently there are about 20.7 GW of planned wind power capacity in the pipeline, but we think less than half or 8.9 GW will be realised by 2030. The coronavirus pandemic has slowed development in 2020, as border closures delay equipment transportation and prevented foreign technical staff support in these nascent Southeast Asian markets.

“Vietnam has risen to become the shining star in the region’s race to add wind power capacity. It alone accounts for 66 percent of new capacity expected to be added by the end of the decade.”

The surge in projects in Vietnam is driven by the government’s decision to upgrade the wind feed-in-tariff (FIT) in 2018 to 85 USD per megawatt hour (MWh) for onshore wind and 98 USD/MWh for intertidal offshore wind with a 2021 deadline for both FITs, though a potential extension to 2023 is still to be decided.

Power demand is recovering, and Southeast Asian countries will be competing to attract large-scale investments to spur economic recovery. This will provide opportunities for governments to push ahead with their new national power plans with expanded roles for more renewables.

Liew added that “there is potential for more upside if Malaysia and Myanmar start utility-scale wind development and offshore wind development occurs in markets outside Vietnam.”