Energy‐Related Environmental Policy and Its Impacts on Energy Use in Asia

Abstract

Economic growth in Asia has increased in the past three decades and has heightened energy demand, resulting in rising greenhouse gas emissions and severe air pollution. To tackle these issues, fuel switching and the deployment of renewables are essential. In the present paper, we discuss the environmental regulations, mainly carbon pricing, implemented in Asia and discuss their achievements. Empirical studies using microdata have shown that carbon pricing in Asia can reduce carbon emissions by promoting energy efficiency. At the macro level, we observe some evidence of fuel switching from coal to natural gas among major emitters. However, more carbon pricing is necessary in Asia if we aim for the decarbonization of the economy.

Comment on “Energy‐Related Environmental Policy and Its Impacts on Energy Use in Asia”

“…Arimura and Sugino (2021) describe how Asian economies have tried to reduce their CO 2 emissions. Arimura and Sugino (2021) do correctly pick up air pollution issues among the many environmental issues as the primary environmental concern for Asian countries. Air quality is indeed very important for the welfare of the domestic population, but global warming seems more important for someone else in the world.…”

“…Arimura and Sugino (2021) also touch upon market policy instruments for CO 2 reductions. They explain very well where Asian countries stand in relation to carbon pricing by emissions trading schemes (ETS) or carbon tax measures.…”

“…Association of Southeast Asian Nations countries as a group may consider ETS. Arimura and Sugino (2021) discuss a variety of cases in different countries, but unfortunately these countries introduced carbon prices or taxes that are far too low or reduction targets that are not ambitious enough to make an effective carbon rate. Arimura and Sugino (2021) say that it should be more than US$30 or 30 Euros.…”

“…Arimura and Sugino (2021) discuss a variety of cases in different countries, but unfortunately these countries introduced carbon prices or taxes that are far too low or reduction targets that are not ambitious enough to make an effective carbon rate. Arimura and Sugino (2021) say that it should be more than US$30 or 30 Euros. IEA (2019, p. 758) assumes that effective rate of carbon for the Sustainable Development Scenario (2° containment) should be as high as US$100 in advanced countries and about US$20 in developing countries in 2030.…”

“…This movement together with the financial sector's selection of TCFD standards will force the electricity supply structure to change. As Arimura and Sugino (2021) conclude, fuel switching from coal to natural gas and further to renewables is happening in Asia and will be strengthened much more and occur much faster than anybody thinks. TCFD has become a mainstream issue in Japanese business circles within the space of a year.…”