In 2022, governments around the world were hit by skyrocketing energy costs, fueled by limited global supply related to global conflicts, post-pandemic relief policies, and a series of unplanned government expenditures.

As a result, nations had to reassess the pace of their commitments under the Paris Agreement to transition to renewable energy and away from fossil fuels. 

The big question which will dominate 2023 and 2024 is: How will countries constructively balance security, equity, and sustainability in their energy policy? In other words,  in the wake of conflict and shifting economic constraints, how best can countries prioritize and enable a just energy transition?

The World Energy Council, a 100-member global community of leaders, industries, governments, and innovators recently identified five major areas affecting countries in 2023 that are attempting a fair and equitable transition to a low or no carbon economy.
 

The big question which will dominate 2023 and 2024 is: How will countries constructively balance security, equity and sustainability in their energy policy?

The following actions are required to address these areas for a just energy transition in Asia and the Pacific:

Reassess Global Trends and Macroeconomics: Countries must reassess their strategies, taking into consideration global trends and macroeconomics to better ascertain the availability and affordability of different energy sources. New or updated strategies and planning should focus on alternative and renewable technologies that emphasize national and regional trade collaboration, ensuring mutually beneficial cross-border clean and green resources. This should be coupled with decarbonized infrastructure that enables economic growth. 

Prioritize Socio-economic Concerns:  Energy access and equity play a crucial role in a just energy transition. The needs of poor, vulnerable and marginalized groups must be assessed regularly to ensure reliable access to clean energy at affordable prices. The just transition must prioritize the needs and concerns of these communities. A decarbonized infrastructure needs to be fair and equitable for all members of society.

New Decarbonized Technologies: Decarbonized energy storage systems can help in balancing intermittent renewables-based energy systems and digitalization can introduce innovative business models as well as more user-friendly energy systems, that will help consumers in getting their energy services at the best price from a competitive market. With these technologies, cybersecurity can strengthen the safety of smart energy systems, protect historic data, and improve reliability by reducing risks of cyberattacks.

Change the Public Policy and Business Environment: Legislation and policies are needed to incentivize investments in decarbonized infrastructure. Countries should consider tax credits or import incentives for clean energy projects to mitigate private sector investment risks. 

Also, policies that promote energy efficiency are needed to decarbonize homes, commerce, and industry. Innovative market designs such as energy transition mechanisms, carbon pricing, and emissions trading can incentivize industries to reduce their carbon footprint. It is also important to have strong and effective trade policies to promote international cooperation and encourage the adoption of sustainable energy practices across borders – simultaneously reducing investment risk and laying the foundation for regional green bulk procurement. 

Contain Environmental Degradation: Environmental factors play a crucial role in promoting a just energy transition. Cleaner air, oceans, inland water bodies, and entire ecosystems will reduce health issues and enhance livelihoods. Marginalized communities suffer most due to the environmental impacts from the human activities. Yet, environmental degradation has no real boundaries. Indeed,  with the improved containment of environmental degradation, alongside decarbonized energy sectors, low-income and marginalized communities will benefit alongside broader society

With the reassessment of global trends and macroeconomics, prioritization of socio-economic concerns, new decarbonized technologies, alternative policies and legislation, and improved containment of environmental degradation – developing countries in Asia and the Pacific can attain a just energy transition, as well as robust and inclusive sustainable growth.