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Focus on Sustainability and Green Business Opportunities in Asia
For APBO 2011, the Country Outlook sessions will feature “sustainability business opportunities”— energy and water conservation, renewable energy and clean coal technologies as well as the wider green technology industry. The Country Outlook speakers will describe the best sustainability and green business initiatives in their respective countries, some of which are mentioned below.
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Energy is a major driver of Australia’s economy. Australia ranks 20th as the world’s largest energy consumer-- quite high relative to its population of 21 million. Australia’s economy is energy intensive, and 84 percent of Australia’s energy consumption comes from non-renewable energy sources. Energy exports are a significant percentage of Australia’s trade balance. The production and use of clean energy is set to play an increasing role in Australia’s future, with legislation passed to require a 20% renewable-energy target by 2020. The government of Australia is investing A$4.5 billion in renewable energy demonstration programs. Technology areas funded by the Australian government include, but are not limited to, wind, solar, geothermal, and wave technologies. There are significant opportunities for U.S. engineering, consulting, and equipment firms. |
CHINA: A $1 Trillion Greentech Market
| Widespread pollution and environmental degradation has accompanied China’s incredible economic growth. Facing limited energy resources and inefficient use of energy, the central government has made greentech and energy efficiency a strategic priority. The China Greentech Initiative estimates the market size for clean energy and environment solutions could be as high as US$1 trillion annually, or as much as 15% of China’s forecasted 2013 GDP in 2013. The 12th 5 year plan will see new restrictions on air pollutants, and electrical waste regulations went into effect in January 2011. China will build half of the world’s new buildings over the next decade and is enforcing green building standards with more frequency, opening up opportunities for U.S. firms. Although China still relies on coal to produce more than two-thirds of its total energy, its goal is to increase the percentage derived from renewable energy sources from 10% in 2009 to 15% by 2020. Evidence of this is that in 2010 China supplanted the United States as the World’s largest wind energy market. China is also investing several hundred billion dollars over the next decade in building a “Strong and Smart Grid,” creating a $600 billion market for companies with smart grid solutions and equipment. |  |
INDIA:$100B Sustainable Business Opportunity Market
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With a shortage of almost all the vital ingredients of urban living, sustainability is the need of the hour in India. Green buildings, water, energy efficiency, and renewable energies are the main cogs for sustainable development and together represent a $100 billion market in the next 5-10 years. The development of green buildings alone will contribute about $40 billion with over 596 registered projects covering a footprint of over 382 m. sq. ft. The solar market is set to boom with a healthy $20 billion in projects expected, as India expands its solar capacity from the current 3 MW to a reported 20,000 MW by 2022. Intense interest in sustainability is sure to create numerous opportunities for U.S. suppliers in these sectors.
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INDONESIA: Institutional Barriers to Foreign Investment
As the world's third largest CO2 emitter and G-20 member, Indonesia wants to be a part of a global solution to climate change and realizes it must do its part to reduce emissions. Indonesia is open to mitigation technologies to reduce its carbon footprint while not impeding the growth of two sectors which contribute enormously to the economy, agro-business and mining. Many clean energy technologies face stiff institutional barriers and a regulatory framework that prevents investment, so there is a lot of work to be done by the government before progress can be made. To that end, there was a very encouraging sign in May 2010, when Secretary of Commerce Gary Locke led a Clean Energy Trade Mission here. Nine government Ministers, each with a piece of the clean energy pie, showed up to brief him on their Ministry’s commitments in the renewable energy sector.
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JAPAN:A $1.2 Trillion Environmental Market by 2020
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Japan’s Ministry of Environment forecasts $641 billion in environmental business by 2020. On top of this, the Government of Japan has pledged to create an additional $549 billion in “green innovation” business. Opportunities abound for American firms offering innovative, high-quality environmental technologies, products and services: to help Japan curb greenhouse gas emissions by 25% by 2020 (requiring an estimated $109 billion in investment); to construct and maintain Japan’s “smart grid” (requiring investments of as much as $673 billion by 2020); to expand Japan’s use of solar power (delivery of solar panels in the 1st half of 2010 was up 75% from the same period in 2009, and is poised to grow even more); to upgrade Japan’s nuclear power infrastructure (existing power stations are aging, previously idle operations have recently re-opened, and for the first time in history Japan’s nuclear industry is looking to export markets), and more. The March 2010 House Eco Point System continues to incentivize homeowners to buy eco-friendly homes or conduct eco-renovation for solar power systems, water-saving toilets, insulation, and more. The recently revised Soil Contamination Countermeasures Act will bolster the estimated $1.2 billion market for in-situ soil remediation technologies, while markets for water treatment, asbestos abatement, and other environmental technologies are also poised to grow. Planned subsidies of some $350 million aim to make next-generation vehicles account for more than 50% of all vehicles on Japanese roads by 2020. |
| Renewable energy is becoming a growth sector in Malaysia. However, the sector is still relatively undeveloped as currently less than 1% of energy generated is by renewable sources. The impetus to this growth was the Malaysian Prime Minister’s announcement in Copenhagen on the country adopting voluntary reduction of up to 40 percent in terms of emissions intensity of GDP by 2020. This new mandate is driving Government of Malaysia (GOM) to look at other clean energy sources which are abundant, untapped and environmentally friendly. In-line with this, the GOM has identified Biomass, Mini-Hydro plants, Solid waste Recovery Plant, Bio-gas Plant and Photovoltaic as the next generation of fuel source in its most recent budget. In addition to creating a Sustainable Energy Development Authority, GOM has taken two additional steps to boost development in renewable energy sector, by implementing a feed-in tariff program later this year and the mandatory blending of biofuels for transport sector in 2011. The government hopes that by 2015 renewable energy would satisfy about 5.5% or 985MW and by 2020 about 11% or 2GW of Malaysia’s energy consumption. The Energy Commission of Malaysia estimates that US$23 billion worth of business could potentially be generated from these renewable energy projects.
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The Philippines is already a world leader in renewable energy with a third of its total electric power needs met through renewable sources. A new Philippine renewable energy law (RE law) establishes a supportive policy environment that offers fiscal and non-fiscal incentives to equipment manufacturers with the goal of achieving 60% renewable energy generation by 2017. The Philippines is blessed with rich renewable energy resources including robust wind energy sites, ideal solar conditions, and an abundance of hydro and biomass resources. The RE law seeks to spur the development of renewable sources by providing incentives to investors, equipment manufacturers and suppliers. The Philippines' National Economic Development Authority (NEDA) is preparing the Medium Term Development Plan 2011-2017. This economic blueprint of the Philippine government will incorporate policies, plans and projects on conservation, protection and rehabilitation of the environment and natural resources towards sustainable development.
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Energy efficient technology and services such as the reduction of electricity, water and gas consumption is a cornerstone of Singapore’s sustainability drive. The market, worth approximately US$70 million today, offers strong opportunities for consultants. In addition, Singapore is looking into using nuclear energy in 15 to 20 years time with tender proposals currently being reviewed for a feasibility study. The Government of Singapore has a number of programs and incentives designed to encourage and promote sustainability, for example, buildings which qualify to be certified with a Green Mark label receive tax benefits. Singapore hosts the Singapore International Water Week annually in July to promote clean, affordable, sustainable water. Last year 510 exhibitors from 39 countries participated in the trade show element.
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TAIWAN: Sustainability Opportunities Abound
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Taiwan is our ninth largest trading partner with an economy that has rebounded sharply in 2010 and enjoyed a 10% GDP growth last year, low unemployment and an appreciating currency that makes U.S. goods and services more attractive than ever before to Taiwan buyers. In 2009, Taiwan passed a Renewable Energy Act offering incentives to develop its renewable energy sources and reduce Taiwan’s greenhouse gas emissions. In 2010, Taiwan passed new legislation requiring all newly constructed buildings for public use to use a minimum of 30% certified “green” building materials. Also in 2010, Taiwan announced the master schedule of its i-Taiwan 12 Major Projects. These 12 projects feature a combined public and private investment of more than US$100 billion over a six-year period (2010-2016) and focus on Taiwan’s sustainable development, including urban and industrial zone renewal, coastal regeneration, flood prevention and water management, and sewer construction. Furthermore, according to Taiwan’s Public Construction Commission, Taiwan’s 2011 budget for infrastructure development is some US$20 billion creating extensive opportunities for U.S. exporters.
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Helen Hwang
Senior Commercial Officer, American Institute in Taiwan (Taipei)
THAILAND: Bioenergy Production to Rise 20% Over Next 12 years
| Thailand's Renewable Energy Projections through 2022 - With energy importation projected to rise to 70 percent from the current 60.8 percent, Thailand's Ministry of Energy is keen to strengthen Thailand's national energy security by increasing its production of renewable energy. As an agricultural country, Thailand will focus on the processing of agricultural industry by-products into biofuels. Together with solar and wind energy, Thailand will boost its renewable energy supply to reach 20 percent of the overall energy demand by 2022. In tandem with the focus on bioenergy production (biomass, biogas, biofuels), Thailand plans to develop solar and wind energy production over the next 12 years. By 2022, solar energy will be increased from the existing 38.6 MW to 500 MW, wind energy from 5.13 MW to 800 MW, biomass from 1,800 MW to 3,600 MW and biogas from 37.5 MW to 120MW. In addition, energy from municipal solid waste is projected to be 120 MW, from the existing 11.88 MW. Total investment in these four sectors is expected to reach USD 9 billion.
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VIETNAM: $200B in Infrastructure Development
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Vietnam’s transitioning, export-led economy has led to a decade plus average annual GDP growth of 7%. But with this rapid growth and development, Vietnam now faces a formidable combination of environmental problems, including air, water, and solid waste pollution. This translates into a multi-million dollar opportunities for U.S. engineering and design, technology, and waste management providers. Vietnam also projects $200 billion in infrastructure development needs over the next 15 years. U.S. products and technologies are sought to meet these needs, particularly in the power, oil and gas, ICT, and architecture and engineering services sectors. In general, American companies and products enjoy a positive reputation for quality, reliability and safety in Vietnam. Now is the time for U.S. companies to leverage this strong American brand image and engage in in this dynamic economy.
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Additional Workshops on Sustainability & Green Business
Carl Voigt, Associate Professor of Management, USC Marshall School of Business, Los Angeles
A research team of USC Marshall MBA students will present its report to the APEC Business Advisory Council (ABAC) on its detailed analysis of the investment landscape for sustainable energy as a sector of the broader environmental goods and services (EGS) landscape across APEC. APEC defines environmental goods and services (EGS) as a sector that involves solving, limiting or preventing environmental problems. EGS companies may manufacture goods and/or provide services related to water or air pollution, waste management, recycling, renewable energy, monitoring, analysis and assessment, or other goods and services related to the environment. Their research objective was to identify key inhibitors and facilitators to investment flows so as to provide policy makers with critical information for improving the APEC policy framework for sustainable energy. Their report presents its findings.
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