Energy Outlook and Energy Saving Potential in East Asia 2025

The East Asia Summit (EAS) Energy Outlook is used to assess the effectiveness of energy efficiency and conservation (EEC) and renewable energy (RE) policies reported by EAS member countries. Following the 26th Conference of the Parties (COP26), held in Glasgow, United Kingdom, in autumn 2021, the urgency of achieving carbon neutrality was reinforced, and many EAS member countries announced target years for reaching carbon neutrality between 2050 and 2070.

In response, the 2021–2022 update of the EAS Energy Outlook introduced a carbon-neutral scenario. Achieving carbon neutrality in EAS member countries requires not only EEC, RE, and nuclear power, but also extensive electrification, the deployment of clean fuels such as hydrogen and ammonia, synthetic fuels produced from captured CO₂ and green hydrogen, and carbon capture and storage (CCS). These innovative clean energy technologies are indispensable, although their suitability varies across EAS countries depending on factors such as economic development levels, natural resource endowments, climate, and topography.

The 2023–2024 update of the EAS Energy Outlook conducts an energy cost comparison between a business-as-usual (BAU) scenario and the carbon-neutral scenario. Total energy costs include fuel costs (fossil fuels and hydrogen), power generation investment costs – including biomass and hydrogen/ammonia co-firing – and CCS operating costs. While the BAU scenario represents the continued reliance on fossil fuels, the carbon-neutral scenario reflects a transition towards net-zero emissions through the adoption of innovative clean energy technologies.

Energy cost outcomes are sensitive to assumptions regarding unit costs for fuels, power plants, and CCS. Nevertheless, the analysis suggests that if fossil fuel prices increase even moderately over the 2050–2070 period, the carbon-neutral scenario could be cost-competitive with, or even less costly than, BAU. It should be noted, however, that while the carbon-neutral scenario entails a significant expansion of solar photovoltaic capacity, the costs of battery energy storage systems (BESS) required to manage power system reliability are not yet included. Addressing this limitation will be an important focus of future EAS Energy Outlook updates.