Renewable purchasing surges in Asia Pacific – Wood Mackenzie

Company procurement of renewable power greater than doubled in Asia Pacific remaining 12 months, consistent with new research.

Firms signed energy acquire agreements (PPAs) for round 3.8GW of renewable power capability in 2020 — greater than double the former 12 months’s overall, consistent with Wooden Mackenzie. Wind accounted for the most important proportion (47%) of this capability, adopted via sun (44%), whilst the rest 9% is undisclosed.

This build up got here in spite of venture delays attributable to labour shortages and logistic disruptions all over the coronavirus pandemic, the analysts famous.

Via the top of the primary part of 2021, company PPAs were signed for 10.9GW of renewable power capability.

Wooden Mackenzie senior analyst Rishab Shrestha mentioned company renewable procurement is beginning to play a larger position in Asia Pacific.

“Call for for renewable procurement is in large part pushed via formidable decarbonisation goals set via governments and firms within the area. However extra importantly, falling renewables premiums and emerging energy price lists in Asia Pacific are making company renewable PPAs extra sexy,” he added.

Renewables premiums have fallen throughout all markets in Asia Pacific, consistent with Wooden Mackenzie.

Transmission fees will offset a few of these top rate discounts, however the overall bargain in comparison to feed-in price lists will have to nonetheless be greater than 30% via 2025.

Marketplace unfold

India, Australia and Taiwan lead the area for company renewable PPA contracting, with cumulative capacities of five.2GW, 3.2GW and 1.3GW respectively via the top of the primary part of 2021. 

Wooden Mackenzie defined that sexy venture economics and enabling coverage frameworks in Australia and India account for the higher company PPA process in those markets

Shrestha added that he expects Singapore and Japan to additionally grow to be leaders in company procurement of renewable power.

He defined: “Singapore is essentially the most evolved procurement marketplace in south-east Asia however has restricted land availability for renewable initiatives. Japan’s procurement is in large part restricted to onsite initiatives, however we think coverage updates via year-end.” 

Company developments and limitations

Business offtakers accounted for 57% of PPAs gotten smaller in 2020, because of prime power call for of electronics production and mining industries  

Retail and repair consumers accounted for 25.4%, whilst the era sector accounted for 16.9%, with power procured essentially used for powering information centres

Club of the RE100 – wherein corporations decide to energy 100% in their operations with renewable energy – higher 12 months on 12 months, however simplest 10% of the 99 member corporations signed company PPAs within the area. 

Maximum RE100 contributors with Asia Pacific headquarters use onsite installations and net-metering sun initiatives to energy their operations as an alternative. Restricted rules enabling large-scale procurement of renewables within the area shape a significant barrier, Wooden Mackenzie defined.

Shrestha mentioned: “Whilst demanding situations stay, coverage, company ambition and economics are beginning to tilt the steadiness in opposition to a extra conducive company PPA panorama for enlargement.”

Author: Ronald Scott