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Market News

 August 23, 2007
Renewable energy can save East Asia two trillion US dollars in fuel costs

 Shifting to renewable energy could save countries in East Asia as much as two trillion US dollars in fuel costs over the next 23 years, or more than 80 billion dollars annually, environmental group Greenpeace said Thursday.

A shift from oil and coal could also reduce carbon dioxide emissions by 22 percent in the same period, it said in a report released to coincide with a meeting of Association of Southeast Asian Nations (ASEAN) energy ministers here.

Globally, investing in renewable energy -- geothermal, hydro, wind and solar power as well as biomass and biofuels -- would save countries 180 billion dollars a year and slash carbon dioxide emissions in half by 2030, Greenpeace said.

Carbon dioxide sent into the atmosphere has been blamed as a major contributor to climate change.

While upfront investment costs are higher for renewable energy, the long-term savings are greater, Greenpeace said.

Athena Ballesteros, Greenpeace International Asia regional climate campaigner, said investment costs for new power plants in East Asia projected by the International Energy Agency (IEA) would total 490 billion dollars between 2004 and 2030.

Under Greepeace's scenario, investment costs on renewable energy would amount to 556 billion dollars over the same time frame.

However, fuel costs in the IEA projections would cost 6.3 trillion dollars over a 23-year period.

But if East Asian states shifted to renewable energy, fuel costs over the same period would total 4.2 trillion dollars, translating into savings of 2.1 trillion dollars, Ballesteros said at a news briefing.

"Our report shows that by employing massive energy efficiency, it makes economic sense to shift to renewable energy," she said.

"By incorporating fuel costs into the picture, investing in renewable energy now is a better long-term option."

However, Southeast Asian energy ministers and officials from China, Japan and South Korea who joined them later at a meeting in Singapore on Thursday indicated that shifting would not be easy.

In a joint communique issued after their one-day meeting, they said that with robust economic growth, the region's demand for oil "will continue to increase, especially in the transportation sector."

They also "recognised that coal will play an important role in the regional energy supply," in sharp contrast with Greenpeace's position calling for a moratorium on the building of new coal-fired plants.

They acknowledged efforts of some countries to explore the peaceful use of nuclear energy and encouraged dialogues to discuss more viable nuclear technologies.

Greenpeace had urged the ASEAN energy ministers to scrap plans to harness civilian nuclear energy and focus resources on developing renewable sources that are abundant in the region.

ASEAN members Indonesia and the Philippines have among them the biggest geothermal resources in the world, Greenpeace said.

The environmental group welcomed statements by new ASEAN chair Singapore that it will include climate change as a key issue during its one-year chairmanship.

It said the city-state "has a unique opportunity to lead ASEAN leaders" to draw up an action plan that can help address the problem. But the 10-member ASEAN should "set ambitious and legally binding" targets and implement strict energy efficiency standards, among others, Greenpeace's Ballesteros said.

ASEAN members have committed to increase the share of renewable energy in power generation to 10 percent by 2010.