Written by Li Hongting / Translated by Xie Zongming
With the major task of energy infrastructure construction, the energy industry is one of the traditional critical areas of China-ASEAN investment. As eco-friendliness, greenness, and cleanliness become the world’s new consensus, sustainable development has started to provide new connotations and facilitation for China-ASEAN cooperation in energy. Through holding exhibitions, the Green and Low-Carbon Development Forum, and the China-ASEAN Production Capacity and Investment Cooperation Forum, the 19th China-ASEAN Expo (CAEXPO) held in 2022 offered a good channel of communication for the topics of regional energy security and energy restructuring and provided opportunities for the efficient and practical cooperation between the two sides, opening a gate to more China-ASEAN cooperation in green development.
What power? How powerful?
At the mainstream of the Sesan River, Cambodia, the Lower Sesan 2 Dam, a 6500-meter-long hydroelectric dam, stands as the artery of the power network connecting China and Southeast Asian countries. The dam is the biggest hydroelectric dam in Cambodia jointly invested in, established, operated, and managed by China Huaneng Group, the Royal Group of Cambodia, and the Electricity of Vietnam. The dam’s installed power-generating capacity accounts for 20% of Cambodia’s total installed capacity, significantly reducing the power shortage and the reliance on energy imports in Cambodia. According to Ms. Kaknika, the daughter of a Cambodian employee of the dam, her village had suffered from power failures due to the power shortage. In the summer, shops couldn’t sell ice creams, and her mother had to cook with a stove in the hot weather. Little Kaknika could only sit beside a kerosene lamp and do her homework with shimmering light at night. However, since the dam was put into operation, the blackout days are gone. The dam has lighted up the villagers’ new life.
Since the Belt and Road Initiative was launched, large Chinese enterprises have actively responded to the call. With green and sustainable development in mind, they have more projects signed with and delivered to ASEAN countries in energy, receiving outstanding results. Many more projects like the Lower Sesan 2 Dam promote ASEAN countries’ development and benefit the local people.
Southeast Asia has always been one of the major regions of China participating in overseas green energy development projects. High-quality overseas sustainable energy projects will bring jobs, economic growth, and a better environment to the host country.
China is among the highest in the world in installed capacity of hydropower, wind power, photovoltaic power, and biomass power and has established a relatively complete industrial chain of clean energy equipment manufacturing. While striving for domestic clean and low-carbon energy development, China is also actively helping ASEAN countries in energy infrastructure construction and energy supply restructuring. According to the data in 2019, China’s energy investment in ASEAN accounted for more than 16% of the total foreign energy investment, with an amount of US$ 8.49 billion. The two sides are constantly strengthening exchanges and cooperation in energy, contributing to the sustainable development of world energy.
CAEXPO facilitates energy cooperation upgrade
In this regard, CAEXPO also sticks to the theme of China-ASEAN green energy cooperation, facilitating it by building a platform for collaboration.
At the Indonesia Trade and Investment Forum held during the 16th CAEXPO, the State Power Investment Corporation (SPIC) Guangxi signed the Cooperation Agreement on the GumbasaHydropower Project, a project with an investment of US$ 370 million, with Indonesia Bagus Islands Power Co., Ltd., PowerChina International Group Ltd., and Kunming Engineering Co., Ltd. At the 18th CAEXPO, there was an exhibition section for smart energy and power, becoming the platform for China’s smart energy and power suppliers to communicate with ASEAN purchasers. SPIC Guangxi Overseas Energy Investment Co., Ltd. signed the Cooperation Agreement on the Smart Energy Project in Vientiane Saysettha Development Zone of Laos with LaoChina Joint Venture Investment Co., Ltd., aiming to bring green energy to Lao people.
In 2022, the 19th CAEXPO set the Electricity, Petrochemical and Carbon Peaking and Carbon Neutrality Smart Energy Exhibition. Large enterprises like China Energy Engineering Corporation (CEEC), China General Technology Group, and China Electrical Equipment Group participated in the exhibition, focusing on displaying technologies and products like the equipment sets for all kinds of power generation, including solar power, wind power, hydropower, and nuclear power, which are of excellent cooperation potential with ASEAN countries.
For the first time, CEEC became the chief strategic partner of the CAEXPO. During the CAEXPO, it signeddomestic projects worth more than 100 billion yuan and seven cooperation contracts with the Philippines, Indonesia, Malaysia, and Vietnam, with a total value of about 13.5 billion yuan and covering the areas of wind and photovoltaic new energy, industrial parks, mining development, and so on. As Malaysia was the country of honor, Malaysian companies also signed a series of cooperation projects in green steel manufacturing and clean energy. Thus, CAEXPO has become a powerful platform for promoting regional energy restructuring and cooperation.
Events like the Green and Low-Carbon Development Forum and the China-ASEAN Production Capacity and Investment Cooperation Forum were also held during the 19th CAEXPO with the theme of “Towards Green Development of China-ASEAN, Boosting Digital Intelligence Integration.” At the fora, experts, scholars, and entrepreneurs from China and ASEAN reached a consensus on clean energy cooperation between China and ASEAN. CAEXPO has built a bridge for communication and collaboration to promote China-ASEAN multi-layer and multi-area energy cooperation and achieve the sustainable development in the China-ASEAN regional energy industry.
Join hands for future opportunities
Currently, under the trend of global efforts against climate change, boosting clean energy development has become a universal consensus. As emerging economies, ASEAN countries have a massive demand for power resources. According to the prediction, ASEAN’s energy demand in 2040 will be 2.5 times that of 2016.
Meanwhile, ASEAN countries have rich resources for renewable energy development, with a strong intention to develop an eff icient clean energy generation system. They jointly approved the ASEAN Smart Cities Network and put forward the goal to have 23% of its energy become renewable energy and have 35% of installed capacity become renewable energy. These release massive opportunities in green energy supply, city traffic, water pollution control, and intelligent power network system. Recently, the Philippines changed the negative list of foreign investment, opening its renewable energy projects to foreign investors. China has accumulated rich policymaking, technology, and project experience in the areas mentioned above, which can facilitate ASEAN countries greatly.
“ASEAN countries have good resource potentials in developing renewable energy, such as hydropower, solar power, and wind power development. They are currently in a preliminary yet vital stage of energy restructuring. With fast-developing China-ASEAN relations, we see more opportunities for cooperation with ASEAN countries in the area of clean energy generation,” said Zhang Ming, Vice President of CGN Energy International Holdings Co., Ltd., during an interview at the 19th CAEXPO.
As the benefit of RCEP gradually increases, the agreement will allow medium-and-large-scale energy equipment and machinery in the energy industry, such as wind turbines, offshore wind power installation, and operation and maintenance equipment, to enjoy greater tariff reduction, promoting the restructuring, upgrading, and optimization of the industry.
“In the past, the biggest challenge for Chinese energy companies to enter the ASEAN market is ASEAN’s disagreement towards some Chinese equipment and standard,” said Zhang Muzi, Director of the General Office of the International Business Department of China Renewable Energy Engineering Institute. He added that RCEP’s consistent standard, technical regulations, and conformity assessment procedures would reduce unnecessary non-tariff barriers, which would facilitate an integrated regional energy market.
With new opportunities, CAEXPO is also catching up with RCEP. In the future, green energy will be a hotspot of China-ASEAN and RCEP cooperation. Enterprises of China and ASEAN should explore the common demands of energy development of both sides, give full play to their respective advantages, and fully utilize the new window period of energy cooperation to achieve win-win cooperation. With the help of the platform provided by CAEXPO, they should further upgrade China-ASEAN energy cooperation and let the world know the rich connotation of China-ASEAN cooperation through green development.
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