• Asia could also accelerate its move to lower carbon emissions by ramping up the use of biofuels and coupling natural gas consumption.
  • Technologies like carbon capture, usage and storage (CCUS) could also "enable a very low carbon energy source that can be deployed at scale, and affordably".
  • In the transition towards a lower carbon future, liquefied natural gas (LNG) is expected to play a key role in Asia for the next 10 to 15 years.

Asia needs to adopt a carbon pricing mechanism to help accelerate its transition towards lower emissions, a senior company official at oil major BP (BP.L) said on Monday.

"A well designed carbon pricing framework that is able to prevent carbon leakage, moving carbon to another area, needs to take place for a transition," said Eugene Leong, president of BP Singapore and chief executive of BP's trading & shipping arm of Asia Pacific and the Middle East.

"It is much more established in the developed countries, and a well designed carbon price drives the right incentives for transition," Leong said in a pre-recorded discussion for the annual Platts APPEC 2021 conference.

Asia could also accelerate its move to lower carbon emissions by ramping up the use of biofuels and coupling natural gas consumption with technologies like carbon capture, usage and storage (CCUS) to "enable a very low carbon energy source that can be deployed at scale, and affordably", said Leong.

In the transition towards a lower carbon future, liquefied natural gas (LNG) is expected to play a key role in Asia for the next 10 to 15 years.

"LNG is also going to pave the way to renewables" because it provides stability in the grid while renewables are still an "intermittent" source of energy, said Leong.

Some countries in Asia have already started using LNG to replace coal to meet their energy demands.

a chart showing renewable energy across asia
Renewable energy share in Asia.
Image: ING

"Nowhere is that (trend) stronger than in China, which actually saw LNG demand rise last year," Leong said.

As part of BP's focus on energy transition, two of its main areas of focus are mobility and low carbon energies.

What's the World Economic Forum doing about the transition to clean energy?

Moving to clean energy is key to combating climate change, yet in the past five years, the energy transition has stagnated.

Energy consumption and production contribute to two-thirds of global emissions, and 81% of the global energy system is still based on fossil fuels, the same percentage as 30 years ago. Plus, improvements in the energy intensity of the global economy (the amount of energy used per unit of economic activity) are slowing. In 2018 energy intensity improved by 1.2%, the slowest rate since 2010.

Effective policies, private-sector action and public-private cooperation are needed to create a more inclusive, sustainable, affordable and secure global energy system.

Benchmarking progress is essential to a successful transition. The World Economic Forum’s Energy Transition Index, which ranks 115 economies on how well they balance energy security and access with environmental sustainability and affordability, shows that the biggest challenge facing energy transition is the lack of readiness among the world’s largest emitters, including US, China, India and Russia. The 10 countries that score the highest in terms of readiness account for only 2.6% of global annual emissions.

To future-proof the global energy system, the Forum’s Shaping the Future of Energy and Materials Platform is working on initiatives including, Systemic Efficiency, Innovation and Clean Energy and the Global Battery Alliance to encourage and enable innovative energy investments, technologies and solutions.

Additionally, the Mission Possible Platform (MPP) is working to assemble public and private partners to further the industry transition to set heavy industry and mobility sectors on the pathway towards net-zero emissions. MPP is an initiative created by the World Economic Forum and the Energy Transitions Commission.

Is your organisation interested in working with the World Economic Forum? Find out more here.

By 2030, BP aims to boost its number of global car charging points 70,000, from 11,000 currently, according to Leong.

"We have more than doubled our low carbon energy generating pipeline to 21 gigawatts today (and) have built up our offshore business to roughly about four gigawatts," Leong added.

This year, the APPEC conference is being held in a hybrid format, including in-person and virtual participants.