Asia-Pacific must invest up to US$9.7 trillion by 2030 to meet energy needs: ADB

The Energy Outlook for Asia and the Pacific projects regional energy demand to grow 2.4% every year between 2005 and 2030, outpacing the world average of 1.5%.

The Asia and Pacific region must invest between US$7 trillion and US$9.7 trillion in the energy sector from 2005 to 2030 to meet the rapidly growing demand for energy in the region, according to a new report released by the Asian Development Bank (ADB).

The Energy Outlook for Asia and the Pacific projects regional energy demand to grow 2.4% every year between 2005 and 2030, outpacing the world average of 1.5%.

Nearly 80% of the region’s energy needs in 2030 would have to be met by fossil fuels – coal, oil and natural gas – and this will drive the growth in carbon dioxide emissions, the report warned. Net imports of oil are projected to increase substantially, nearly doubling the 2005 level by 2030.

The report is jointly published by ADB and the Asia-Pacific Economic Cooperation. It was launched together with another report, Energy Statistics in Asia andthe Pacific (1990-2006), during the Pacific Energy Summit. The two studies were undertaken by the Asia Pacific Energy Research Centre of The Institute of Energy Economics of Japan.

During the launch, ADB Vice-President Lawrence Greenwood called on all stakeholders to seek a low-carbon path to meet growing energy demand in a socially, economically and environmentally sustainable way.

"Cooperation among the economies is needed to enhance energy security and sustainable development in the region," Mr. Greenwood said. "This can be done through sharing policy information, facilitating energy trade and conducting joint energy projects."

The Energy Statistics report found that the region consumed 34% of the world's total primary energy supply in 2006. But the per capita electricity generation of 1,800 kWh in the region is still 37% below the world average of 2,870 kWh.

Access to modern forms of energy is a necessary condition for economic development and a high standard of living. In 2005, in theAsia and Pacific region, about 930 million people did not have access to electricity.

Xianbin Yao, ADB's Director General for Regional and Sustainable Development Department, said that there is a need to build a more robust energy database in the region.

These publications are the first attempt to consolidate and project energy demand and supply information in Asia and the Pacific by country, sub-region and the region as a whole. These will provide insights into the recent energy situation and a wealth of information for stakeholders inside and outside the region to chart their course of action in planning for energy investments,sustainable development, and poverty alleviation.

The two reports consolidate historical trends of energy demand and energy outlook up to 2030 in ADB's 48 regional members.

The Pacific Energy Summit, organized by National Bureau of Asian Research and co-sponsored by ADB, is a gathering of the world’s top leaders in science, government, and industry to advance regional cooperation on technologies, programs, and policies necessary in meeting resource requirements, sustaining economic growth, and reducing environmental impact throughout the Asia-Pacific.

ADB raises India’s growth forecasts

An increase in public spending, a quicker than expected return of capital inflows, stronger industrial production, and signs of improved business confidence will lift economic growth to 6% in India this year, up from an earlier estimate of 5%, said the Asian Development Bank (ADB). The Asian Development Outlook 2009 Update (ADO Update) said that while agricultural output for 2009 is expected to remain stunted and exports weak, adroit economic management in the form of fiscal stimulus packages and accommodative monetary policy has minimized damage from the global financial crisis and is supporting a relatively strong economic expansion again. The report forecasts growth of 7% for 2010, also an upward revision from the 6.5% projection in March.

"The Government's strong fiscal stimulus, complementing the Reserve Bank of India's (RBI) aggressive monetary policy easing, has successfully brought last year’s economic slowdown to an end," said ADB Chief Economist Jong-Wha Lee.

Growth in the first quarter of 2009 reached 6.1%, a modest rise on the previous two quarters, with the upturn reflecting a recovery in industrial growth to 5% from less than 2% in the previous six months. The company net profits grew strongly and ECBs rose 19% in June, the highest expansion since Sept. 2008. Weak agricultural output in the second and third quarter is likely to weigh on growth, although the report said a rebound is expected in the final quarter.

The report noted that growth for 2009 will continue to be driven by Government expenditure, with the combination of countercyclical fiscal policies and renewed investor confidence expected to sustain an expansion in private consumption and investment. The impact of difficult weather conditions on rural incomes and consumption will be partly offset by budgetary programs to aid households in the rural areas and possible supplementary support, the ADB said.