asia

Solar and offshore wind to help renewables double in Asia this decade: Fitch Solutions


Despite some near-term delays due to the Covid-19 pandemic, solar power and offshore wind will drive steep growth in non-hydro renewables in Asia, which will more than double between 2020 and 2029 to a capacity exceeding 1,500GW, Fitch Solutions forecast.

As markets recover gradually, the analyst sees an acceleration of growth over the coming years, also as several countries have made carbon neutrality pledges, among them China, Japan, South Korea or New Zealand.

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“For example, South Korea has established a Green New Deal similar to that of Europe, and will look to invest 73.4 trillion south Korean won ($67.41bn) over the next five years to expand its renewable energy capacity, green mobility industry (electric vehicles and hydrogen fuel cell vehicles) and the development of ‘smart green cities’,” Fitch said.

Solar is seen remaining the key growth driver in renewables, given its rapidly-falling component costs, led by China, which is expected to remain the largest individual market for solar growth, adding more than 263GW over the coming decade, followed by India and Japan, who are seen adding about 78GW and 35GW of net solar capacity.

As Chinese solar manufacturers have continued to expand their manufacturing bases outside China, a local supply chain further lowers prices for domestic use in these markets, in particular in Southeast Asian countries such as Malaysia, Thailand and Vietnam.

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Offshore wind policies

Another key bright spot in the region is offshore wind, according to Fitch Solutions.

Taiwan remains one of the largest markets for wind at sea worldwide. The country has nearly 11.2GW of offshore wind capacity in the project pipeline at present, according to the analysts’ key projects database.

The government currently is finalizing the framework on phase 3 of Taiwan’s wind development plan for the 2026-35 period.

Fitch Solutions also expects several proposed policies to boost the development of wind at sea in Vietnam, with the market growing from its current base of 750MW of connected capacity to over 7GW by 2029. The government is in the process of amending seabed lease and licensing requirements for large-scale offshore wind farms.

Japan, which has also seen an increased focus on its offshore wind sector of late, also presents an upside risk to Fitch Solutions’ forecast. The country last year launched its first offshore wind tender in June, for the Goto project off Nagasaki.

But the analysts add: “That said, we are waiting on more concrete project developments before factoring stronger growth, given ongoing challenges and the number of false starts seen in this sector over recent years.”



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