KPMG’s report explores renewable energy as a key enabler of decarbonization
KPMG ASPAC launches ‘Decarbonization through renewable energy: Understanding Asia Pacific’s Corporate Power Purchase Agreement landscape
KPMG ASPAC launches ‘Decarbonization through renewable energy
Asia Pacific’s Corporate Power Purchase Agreements (CPPAs) emerge as a pivotal approach for corporates as they move forward on their Net Zero journey.
KPMG has released the Decarbonization through renewable energy: Understanding Asia Pacific’s Corporate Power Purchase Agreement landscape report, which gives an overview of the renewable energy market in the Asia Pacific region.
The report, which provides enterprises with a clear view on the CPPA market and summarizes both opportunities and barriers in the current renewable energy market, looks at government policies and regulations, types of basic power purchase and sale contracts, and renewable energy related policies and objectives of some major power plants. It further elaborates on the electricity market framework, Corporate Power Purchase Agreement (CPPA), renewable energy certification, policies, purchase and sale cases of 12 markets in the Asia Pacific region.
The report highlights six key trends driving the future development of the renewable energy market in the region.
- CPPA market in the Asia Pacific region is still less developed but shows significant potential for growth.
- Regulatory framework to implement changes to the CPPA framework is rapidly evolving in the region.
- The phase-out of generous feed-in-tariff (FiT) scheme is expected to increase the appetite for CPPAs.
- Economics and net-metering are driving the rooftop solar installation and increasing adoption of on-site PPA.
- There is a growing interest in CPPA across Asia Pacific to achieve their respective sustainability commitments.
- Asia Pacific is progressing towards a low-carbon energy future.
As an increasing number of countries respond to climate change and announce their commitments to Net Zero, supporting mechanisms and measures continue to bloom. Besides domestic and foreign regulatory requirements, the demand for an enterprise to have sustainable operations and supply chains have also become the driving force for corporations to purchase green electricity.
It has been challenging for businesses in the Asia Pacific region to source renewable electricity due to limited availability, regulatory complexity and high costs. But what enterprises should recognize is that this also offers some of the biggest opportunities for clean energy investment and growth, so long as they understand the complexities of the environment in which they operate, and are able to deploy the right strategies.
Global Infrastructure Power Sector Lead
KPMG in Taiwan
According to the Paris Climate Agreement, there is a target to achieve carbon neutrality and Net Zero carbon emissions by 2050. However, with the intensification of climate change and the global energy crisis caused by the Russian government’s war in Ukraine, the price of renewable energy has risen in response.
This situation will likely result in two important outcomes. Firstly, corporates are now much more willing to enter into long-term corporate PPAs as it offers a hedge against increasing energy prices. Secondly, the European Union and other Governments have aligned energy security with clean energy solutions, which can help accelerate renewables deployment globally.
Global Head of Renewable Energy
Every market in the region has a different electricity market liberalization progress and regulatory framework, which makes green energy procurement challenging, and impacts the path to Net Zero.
Asia Pacific is one of the most vulnerable regions on this planet when it comes to climate change. Many governments are already pushing for increased renewables to reduce greenhouse gas emissions and drive energy transformation, resulting in a more friendly environment for the development of renewable industry. In addition to Net Zero targets at a national level, renewable electricity procurement at a corporate level is vital when it comes to taking action on commitments related to RE100 and science-based targets.
Head of ESG
KPMG Asia Pacific
Thailand has committed to reduce GHG emissions by 20%-25% by 2030.With electricity consumption on the rise, this means that authorities need to fully support renewable energy, introduce schemes to benefit corporations that reduces their GHG emissions, while also introducing clear regulations surrounding CPPA, net metering and off-site PPA. Given the complex nature of the subject, this needs to be done by considering all aspects as well as bringing in key experts to help with the process.
Head of Climate Change and Sustainability Services
KPMG in Thailand
For more information, download the full report: Decarbonization through renewable energy: Understanding Asia Pacific’s Corporate Power Purchase Agreement landscape
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Manager, KPMG in Thailand
Notes to Editors:
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