Southeast Asia may become a net importer of fossil fuels in next few years, IEA warns

Increases in domestic demand for coal and exports to China and India could reduce surpluses, leading to coal imports and increased carbon emissions

Renewable energy is set to play a larger role, but only account for about 30 per cent of power generation by 2040, the International Energy Agency says

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A tug boat pulls a coal barge along the Mahakam River in Samarinda, East Kalimantan province, Indonesia. Photo: Reuters

Published: 11:51am, 30 Oct 2019Updated: 11:25am, 31 Oct 2019

Southeast Asia could become a net importer of fossil fuels in the next few years, raising the financial burden on governments and increasing carbon emissions in the region, the International Energy Agency (IEA) warned in a report.

This comes despite expectations of slower growth in the region’s energy demand as economies shift towards less energy-intensive manufacturing and services, and greater efficiency, the agency said in its annual Southeast Asia outlook.

The region was already a net oil importer at 4 million barrels per day (bpd) in 2018, while strong growth in demand for natural gas has reduced the surplus of gas for export, the world’s energy watchdog said.

For coal, output from the region’s top producer, Indonesia, remained well above 400 million tonnes of coal equivalent last year but increases in domestic demand and exports to China and India could reduce its surplus. “These trends point to Southeast Asia becoming a net importer of fossil fuels in the next few years,” the IEA said.

Electricity poles at a power station. Photo: Reuters

The region’s overall surplus of supply over demand at 120 million tonnes of oil equivalent (mtoe) in 2011 had been eroded to just above 30 mtoe in 2018, it said.