Renewables integration, energy storage and investment uncertainty among top five problems faced by Asia’s power sector, says report

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The integration of renewables into the power grid was the number one challenge to decarbonisation identified by respondents. Image: C-Crete Technologies.

Renewable integration, sufficient energy storage and market uncertainty are three of the top five challenges facing Asia’s power sector today, according to Black & Veatch’s Asia Electric report that also overwhelmingly named hydrogen as a key decarbonisation method beyond the next decade.

It found that 35.1% of respondents believed the integration of renewables was the biggest challenge they faced in the context of the energy transition. Economic regulation (24.6%), uncertainty of investment (24.6%) and market uncertainty due to the pandemic (24.6%) came in tied second, third and fourth place. Fifth on the list of challenges was energy storage at 21.1%.

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Just 10% of those asked were very confident in the performance and resilience of their transmission and distribution systems given the joint pressures of renewables integration, population growth and climate change, while 42.9% said they were “somewhat confident”.  

“Integrating intermittent renewable energy into traditional grid structures was identified as the single biggest challenge the industry [is] facing,” said the report, which surveyed 57 senior electric industry professionals and conducted a poll of 33 commercial and industrial (C&I) electricity customers.  

The research noted how electricity generation models were changing and “will no longer centre around a few large baseload facilities” and that such changes were compounded by “an underinvestment in transmission systems and insufficient energy storage capacity”.

Indeed, uncertainty of investment ranked highly (3rd) on the list of challenges facing Asia’s electricity sector and 36.8% of respondents believed that underinvestment in more reliable transmissions networks was the biggest threat to reliable grid operations and performance in their region. This was bookended by government policies at 43.9% and inadequate storage capacity at 31.6%.

According to respondents, battery energy storage is making it easier to manage and reduce losses in the power system, with 19.4% naming it as a factor driving renewable energy investments in their region, up from just 8.9% in 2020.

When asked what methods they expected to be crucial in meeting emissions reduction goals beyond the next ten years, respondents overwhelming said hydrogen generation (73%), with 46.2% believing hydrogen generation will take off in their region as a clean and affordable alternative to existing gas generation by 2030. Only 7.7% of respondents thought “hydrogen generation does not have a feasible future”.

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