Ukraine conflict highlights need for clean energy shift

MANILA, Philippines — The war between Russia and Ukraine is highlighting the need for developing Asia Pacific economies to shift toward clean energy and make them less vulnerable to a global oil crisis.

In its recent blog, Manila-based Asian Development Bank (ADB) said the geopolitical conflict in Eastern Europe has intensified the urgency to develop mechanisms for ensuring a smooth transition to cleaner energy sources.

Oil importing countries, such as the Philippines, are bearing the brunt of continued escalation of the war.

In fact, pump prices on the domestic front have been on the rise since the start of the year. Power rate hikes are also expected in the coming months.

ADB’s Independent Evaluation Department director Nathan Subramaniam and principal evaluation specialist Sherine Ibrahim said a lack of diversified energy sources creates enormous risks and huge volatility to energy supply and prices.

Energy demand in the country has been rapidly growing due to economic growth, demographic expansion, and increased urbanization. Nearly 60 percent of the country’s power generation comes from coal.

The National Economic and Development Authority (NEDA) has said there is a need to have more of the other forms of energy to lessen the country’s dependence on oil.

Not only to comply with climate change agreements, NEDA said this is the smart way to diversify and harness sources sustainably.

However, Subramaniam and Ibrahim argued that developing countries in the region are facing greater challenges in transforming their energy systems from fossil fuels to renewables in response to climate concerns.

They said political and economic concerns, along with the impact of the pandemic, have accentuated these challenges.

“In the transition to renewables, there is an inherent trade-off that needs to be managed. Economic growth requires a stable baseload power, which is currently serviced by fossil fuels. This must be carefully balanced against the longer term need to switch to renewable sources,” they said.

For a successful energy transition, the ADB experts noted that countries need to work with their partners to address geopolitical issues, technological limitations, and financial constraints.

One of which is to shift the focus of oil companies as they will need to leverage their base assets and operating expertise, while increasing participation and investment in renewables.

Another is to promote the electrification of transport through the adoption of electric vehicles, but both the public and private sector need to work together to develop policies and infrastructure to support such transition.