Solar Can Power Rural Southeast Asia Equitably and Sustainably

Electricity is Scarce and Dirty in Rural Southeast Asia

In Southeast Asia, researchers from Universiti Malaysia found that rural electrification remains a significant development challenge a surprisingly large number of 45 million people still lack access to reliable electricity. The costs of solar energy systems have dropped 80 percent in the past decade, making them the most viable off-grid solution.

Researchers led by Donal Brown of the University of Sussex similarly found that about half of the population in ASEAN lives in rural environments and about 10 percent do not have access to reliable electricity. Many communities remain unconnected, with limited or no grid access. Moreover, electrification rates are highly stratified between rural and urban areas.

Instead of electricity, households and businesses use traditional fuels such as firewood, dung, coal or diesel. Along with having high costs and exacerbating climate change, these sources of energy are a health hazard. The combustion of traditional fuels such as coal and firewood releases high levels of pollutants and toxic gases, ADBI said, increasing risks of respiratory and cardiovascular diseases as well as neurological or psychiatric disorders and premature death. Clean energy adoption mitigates these risks by improving indoor and outdoor air quality, contributing to better physical and mental health.

Companies seeking to replace traditional fuels such as biomass or gas with renewable energy sources face challenges. Bureaucratic hurdles often delay or block renewable energy deployment, SEI observed, with Vietnam requiring project developers to take 17 administrative steps simply to start a solar energy project. In Thailand, the unpredictability of the permitting process is often an issue for renewable energy developers.

While Cambodia plans to expand its portfolio with large-scale solar farms, Mekong Eye said the growth of small-scale solar has been sluggish due to policy challenges there too. Although recent regulatory changes aim to introduce new energy tariffs and boost rooftop solar initiatives, the country prohibits net metering and net billing. If the hurdles can be overcome, Mekong Eye opined, rooftop solar could provide a solution for industries and help transform the lives of residents across the 245 villages yet to be connected.

Government Policy supports Changes

Across Southeast Asia, government policy changes and new initiatives are leading to growth in renewable energy.

Laos plans to achieve 98 percent electrification by the end of 2025, ASEAN Energy said, focusing on rural and remote areas. The government is preparing new frameworks for solar mini-grids and off-grid electrification projects to support these goals.

In Vietnam, the Renewable Energy Master Plan updated targets for wind and solar power capacity that are linked to the National Green Growth Strategy for 2021-2030. Vietnam expanded its financial incentives for businesses adopting renewable technologies and green practices, which is helping to scale up rooftop solar initiatives.

Cambodia has continued the implementation of its Power Development Masterplan 2022-2040, a framework for clean energy transition with a focus on renewable energy. Off-grid solutions are expected to exceed a 98 percent village electrification rate.

In Malaysia, the National Energy Transition Roadmap outlines the nation’s commitment to a 70 percent renewable energy share by 2050. Specific measures include a Solar for Rakyat Incentive Scheme, which encourages residential solar installations, and support to increase household adoption of solar systems.

This year, SEETAOE noted, the Indonesian government introduced a plan for 80,000 villages each to build a 1 megawatt solar facility with 4 megawatts of energy storage.

Small Companies have Opportunities

Small companies are taking notice of the rapidly dropping cost of solar and the government policy changes. While many solar energy firms focus on urban areas or large-scale solar farms, a number focus on or have a significant part of their business in solar solutions for rural areas.

Agros, for example, has expanded its operations to Indonesia, Cambodia, and Myanmar. Alliance for Rural Electrification says it provides solar-powered irrigation solutions, which have supported more than 6,000 smallholder farmers. It aims to partner with 30,000 farmers by 2027, increase their collective income by US$40 million and prevent 1 million tonnes of CO₂ emissions.

Myanmar Myat Royal, a woman-led SME founded in 2016 has shifted its focus from making bricks for construction to providing solutions for renewable energy. It is working to bring affordable and reliable solar power to off-grid villages in Myanmar, starting with Tat Kone Township in Naypyidaw.

One longstanding company is Greenergy Solar, which Forum for the Future says has been developing renewable energy projects in Mindanao in the Philippines since 2008. The company designs and deploys solar-energy systems including on-grid and off-grid setups that meet local utility needs and communities’ energy challenges. Resilient and affordable solar creates pathways into clean energy serving constituencies that other programs overlook.

NGOs are also helping with the shift. Light of Hope Philippines, founded by Jovie Montajes after Typhoon Rai in 2021, helps families secure affordable access to clean energy. It has distributed portable solar kits to 1,229 families in Surigao on the island group of Mindanao so far, which also eliminated 153 tonnes of carbon dioxide emissions. By 2030, it aims to deploy 5,000 more solar units and reduce carbon dioxide emissions by about 650 tonnes per year.

And the solutions go beyond homeowners and farmers. Canopy Power focuses on the hospitality sector, though it is seeking to diversify into mining or food and beverage companies. It is working with Total Solar Distributed Generation, for instance, to develop one of Southeast Asia’s largest off-grid renewable microgrids on the island of Koh Rong Sanloem in Indonesia. The development will allow more than 60 hotels, resorts and guesthouses on the island to get more than half their power from renewables instead of being fully reliant on diesel.

While faster would be better, there is clear momentum towards more renewable energy in Southeast Asia. Along with benefitting rural homeowners and businesses tremendously, the results will have a global impact through the significant reduction in greenhouse gasses.