Electricity prices across Asia and the Pacific are seen to rise by as much as 27% by 2025 if the region’s energy supply will remain unchanged, the Asia Development Bank (ADB) said.
In a blog post written by ADB Principal Energy Specialist Kelly Hewitt, global energy prices have increased by 26% in the early months of 2022 alone due to Russia’s invasion of Ukraine, consumer demand rebound from the COVID-19 pandemic, and insufficient crude oil and natural gas supply.
“Energy price increases have caused public enthusiasm for a clean-energy future to temporarily wane. Countries have revised coal power plant closing targets, and short-term tax holidays are being considered for at-the-pump petroleum products,” Hewitt said.
While renewable energy sources such as wind and hydro are important and necessary, Hewitt said that these are intermittent and they lack firm reliability and sufficient storage devices in the energy production market.
“Supply and demand are driving energy market price increases, and the global energy market is currently comprised of fossil fuels, including crude oil, natural gas, and coal,” Hewitt said.
Hewitt believes that the high power prices are only short-term. However, the best way to move forward is “through clean energy innovation and firm low-carbon pathways to a no-carbon future.”
“The world continued to rely on fossil fuel production to maintain and grow economies. Over five decades later, we now have another energy crisis. It’s important that we observe past global lessons learned and act more aggressively to change regional and global trajectories to a no-carbon future,” Hewitt said.