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Welcome to the first edition of our Asia newsletter for 2024, celebrating the Year of the Dragon! We kicked off the year with an energizing in-person team meeting, where we planned and strategized for the upcoming year. This meeting was a great opportunity for us to connect, reflect on our past work, and identify the most important actions to accelerate the energy transition, our organisation's core mission.
We are delighted to introduce Mutya Yustika as the newest addition to our team. Mutya has recently started as our Energy Finance Specialist for Indonesia. Her extensive knowledge of energy finance, particularly in Indonesia's coal and renewable energy sectors, is a valuable asset that will enhance our effectiveness in this critical market.
Furthermore, our team has been actively involved in producing recent analyses on the latest developments in the energy transition:
Last week, the United States announced a pause on permits for new U.S. liquefied natural gas (LNG) export facilities. Some have suggested that the move will threaten the region’s energy security and decarbonization goal, but such concerns are unfounded.
JERA Co. Inc. (JERA) is Japan's largest power producer and the world's top buyer of liquified natural gas (LNG). Our new analysis shows that their pursuit of co-firing ammonia and hydrogen in its thermal-generating assets will preserve its existing fossil fuel business — at the expense of implementing a credible net-zero pathway for the company and Japan.
IEEFA’s analysis of other potential energy transition mechanism markets has seen Pakistan emerge as a possibility: its thermal power fleet is stocked with middle-aged, medium-sized liquified natural gas or diesel plants that could be candidates for early retirement. However, if any deal is to materialize in time, conversations among stakeholders need to happen now.
We look forward to continuing the momentum, creating more impactful research to advance the energy transition, and collaborating more with the IEEFA Asia community to achieve collective impact this year.
Paige Nguyen
Regional Director, Asia Institute for Energy Economics and Financial Analysis
Latest Releases
Concerns about the U.S. LNG pause in Asia are overblown
Sam Reynolds
February 1
Last week, the United States (U.S.) announced a pause on permits for new U.S. liquefied natural gas (LNG) export facilities. The move sparked outcry among industry groups in Asia, which quickly declared the move would hurt the region’s energy security and climate goals. However, their concerns are unfounded.
“It’s not Asia’s energy security and climate goals at risk from the U.S. decision, it’s the global oil and gas industry’s unquenchable thirst for profit.”
JERA is putting Japan's decarbonization goals at risk
Christopher Doleman
January 26
JERA Co. Inc., Japan's largest power producer and the world's top buyer of liquified natural gas (LNG), is showing no signs of abandoning its fossil fuel-dominated business model. Rather, it is seeking to prolong the life of its coal-fired power plants through adopting unproven decarbonization technologies.
“Without a change in corporate strategy geared toward a more aggressive deployment of proven, cost-effective renewables, JERA's approach could derail Japan's decarbonization goals and Asia's shift to net zero more broadly.”
Closing coal plants early makes economic sense in Pakistan
Haneea Isaad
January 11
In Pakistan, middle-aged, medium-sized power LNG/diesel-based plants may be more suited to early retirement in the near term, and an energy transition mechanism (ETM) facility may be an opportunity to bring the troubled coal power plants on board.
"The pursuance and financing of a timely coal phaseout requires careful planning. Reducing a country’s fossil fuel dependency must go hand-in-hand with an acceleration in renewable energy and smart grid infrastructure investments, while minimizing impacts for communities and workers."
Mutya brings over 12 years of experience in accounting, financial, and investment analysis, with a focus on the coal and renewable energy sectors. Before joining IEEFA, she was part of IDI-Infrastructures Inc., a Daiwa Group private equity firm, and Infunde Development, Pte, Ltd, a fund manager for InfraCo Asia Development Ptd. Ltd. At these companies, Mutya played a key role in overseeing and supporting renewable energy projects in Indonesia and Vietnam.
Earlier in her career, Mutya worked at PricewaterhouseCoopers and PT Kaltim Prima Coal, one of Indonesia's largest coal mining companies. Mutya holds a Master of Accounting degree from the University of Indonesia and has earned Chartered Accountant and Financial Modeling and Valuation Analyst certifications. She is currently working towards CPA and CFA certifications.
The Big Question
Pakistan is going through an economic crisis, the scale of which it has never seen before. Under such circumstances, an Energy Transition Mechanism (ETM) deal could face a host of challenges.
What needs to be done now to achieve energy security while ensuring a timely phaseout of high-carbon assets?
Figures Speak
315
JERA's recent success in kickstarting 315 megawatts of offshore wind projects is promising, but clear, aggressive domestic deployment targets are needed to enable the company to contribute effectively to Japan's decarbonization.
IEEFA also finds that JERA's roadmap would reduce the amount of carbon dioxide the company generates per unit of thermal power by a third by 2035 – progress, but far short of the net-zero path championed by the International Energy Agency.
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