Science & Tech · Science & Environment · 2 hrs ago
Asia’s Energy Demand Is Set to Drive a $15 Trillion Investment Need
Asia’s energy choices will have a major influence on the global shift to cleaner power.
The region is expected to drive about 70% of global net energy demand growth through 2040, as industry, data centers and demand for cooling expand.
McKinsey says Asia will need $1 trillion in energy investment each year for 15 years to meet demand, improve energy security and support the transition.
Coal remains central: it supplies about 47% of Asia’s primary energy and more than half its electricity, with demand expected to stay steady across the region.
Wind and solar investment will need about $300 billion a year, while falling costs are making renewables and battery storage more competitive with fossil fuels.
Solar has overtaken gas as Asia’s third-largest power source, and renewable energy costs across Asia-Pacific are projected to be a third lower than conventional coal by 2030.
Asia is expected to account for about 70% of global net energy demand growth through 2040.
The region will need $1 trillion in annual energy investment over the next 15 years, according to McKinsey.
Asia’s energy demand is forecast to reach 370 million terajoules, 15% higher than projected a year earlier.
Coal is expected to remain the region’s dominant fuel for longer than previously anticipated.
Wind and solar investment needs are estimated at about $300 billion annually, mainly in India and Southeast Asia.
- Who
- Asian governments and energy investors will shape the region’s energy future.
- What
- Asia is projected to need $1 trillion in annual energy investment to meet rising demand, strengthen energy security and support the energy transition.
- When
- Over the next 15 years; the demand forecast extends through 2040.
- Where
- Across Asia, with wind and solar investment concentrated mainly in India and Southeast Asia.
- Why
- Growing demand, including from data centers, industrial expansion and cooling needs, is driving the investment requirement.
This story does not have two clearly opposing sides.
Asia is expected to require $1 trillion in annual energy investments.
Asia is projected to account for about 70% of global net energy demand growth.
China generated less than 50% of its electricity from coal for the first time.
Renewable energy costs across the broader Asia-Pacific region are projected to be a third cheaper than conventional coal.
- Annual investment need
- $1 trillion
- Energy demand by 2040
- 370 million terajoules
- Share of global net demand growth through 2040
- About 70%
- Annual wind and solar investment
- About $300 billion
- Coal share of Asia’s primary energy mix
- About 47%