Prof S Jayakumar at the Opening Ceremony of the 25th ASEAN Ministers on Energy Meeting

SPEECH BY PROF S JAYAKUMAR,DEPUTY PRIME MINISTER, COORDINATING MINISTER FOR NATIONAL SECURITY AND MINISTER FOR LAW, AT OPENING CEREMONY OF THE 25TH ASEAN MINISTERS ON ENERGY MEETING, 23 AUGUST 2007, 9.00 AM AT SHANGRI-LA HOTEL

A REGIONAL APPROACH TO THE ENERGY CHALLENGE

Excellencies,

Delegates,

Ladies and Gentlemen,

Introduction

I am pleased to join you here today at the Opening Ceremony of the 25th ASEAN Ministers on Energy Meeting. This Meeting is held at an important juncture in ASEAN’s history. ASEAN countries are celebrating 40 years of ASEAN cooperation this year, and members are finalizing an ASEAN Charter that will bring ASEAN to the next level of regional cooperation. Today however, we will focus on the important topic of energy security, which is also one of the key themes of the ASEAN Summit to be held in Singapore later this year.

The Energy Challenge

Let me start by painting a broad strategic picture of the energy landscape today.

Asia as a region is experiencing an unparalleled decade of fast growth, largely driven by the emerging economies of China and India. Other developed Asian countries like Japan and South Korea are also experiencing an economic resurgence. South East Asia economies are also registering high growth rates.

Countries need competitively-priced and reliable energy supplies to support their economic development. It is thus unsurprising that Asia presently accounts for, and will continue to account for, a large proportion of the increase in energy demand in the years to come. Reliable, affordable supplies are essential for Asia’s continued growth. ASEAN is no exception. As one of the world’s fastest growing region, ASEAN would require increasing energy supplies to fuel its rapid pace of economic expansion.

Much of Asia’s oil demand is currently met, and will continue to be met by supplies imported from the Middle East. With rising global demand for oil, and shrinking spare production capacity, oil prices have almost tripled within the last decade. Political instability in the Middle East region has only added to the worries of energy-importing countries. Given that many ASEAN countries are highly dependent on Middle East oil imports, rising energy prices and disruptions in energy supply could negatively impact our development and economic competitiveness. 

Energy however, cannot be considered on its own, given growing concerns over the environment and climate change. The use of energy in power generation, transport and industry is recognized as a major contributor to the build-up of greenhouse gas emissions. There is emerging consensus in the scientific community that climate change, if not averted, could have serious consequences. It is thus important that countries, in their pursuit of economic growth, balance their developmental objectives with environmental sustainability.

Given the two key and interconnected energy challenges confronting policymakers today, namely, energy security and climate change, governments would have to formulate comprehensive policies that address both challenges. For instance, while countries seek to diversify their energy mix in order to enhance their energy security, it is important that they also pay attention to developing alternative energy sources that are clean, such as solar power, newer-generation biofuels from sustainably grown sources, hydro-power and, for interested parties, civilian nuclear power.

Due to the cross-cutting and global nature of these challenges, it is important that as countries develop their respective policies, they should also recognize the need for regional and international cooperation when dealing with these issues. Energy-exporting and energy-importing countries are increasingly interconnected and interdependent on each other for their own security of supply and security of demand respectively. Thus, international cooperation is needed to effectively meet and overcome these energy security challenges. Likewise, climate change is a global problem with global repercussions. It is important that as countries take national responsibility for this issue, they also work together to come up with a concerted international response to deal with this pressing problem.

In light of the above, I would like to share with you four key energy priorities for ASEAN.

1. Improving Energy Efficiency

First, energy efficiency. Using energy more efficiently can reduce dependence on imports and enhance energy security, while at the same time, cutting down on emissions. Research by the International Energy Agency (IEA) suggests that improvements in energy efficiency can contribute nearly two-thirds of global carbon savings in 2030.

On its part, ASEAN has developed several measures to promote energy efficiency and conservation, and I would like to applaud these efforts today. For instance, ASEAN has been giving out the ASEAN Energy Awards as an innovative means of highlighting best practices on energy efficiency. Cooperation on energy efficiency has also been extended to the broader ASEAN + 3 and the East Asia Summit. These are positive developments that we need to encourage.

2. Development of Competitive Regional Energy Markets

The second priority is the development of competitive regional energy markets. As ASEAN is endowed with rich energy resources, and is located in a well-defined geographical region, there is much scope for increasing energy trade and investments. The establishment of open and efficient markets will improve countries’ access to energy supplies and facilitate transfer of new energy technologies.

While the development of a fully integrated ASEAN energy market is a still distant goal and will be a very long process, we have started to move in the right direction. The Memorandum of Understanding on the ASEAN Power Grid, which will be signed today, provides the essential framework for us to bring the project forward. Having taken the first step, we must continue to work together to promote competitive markets in the region.

3. Investing in Energy R&D

The third priority is to invest in energy research and development. Technology is a critical enabler to break the link between economic growth and global warming. Research into more efficient use of energy and new technologies, such as clean coal, solar power, and sustainable biofuels, will allow us to mitigate carbon dioxide emissions, as well as contribute to supply security. Beyond environmental and security benefits, the development of commercially viable energy technologies will also bring economic benefits by growing new industries and creating new jobs. I am very pleased to note that in ASEAN, there are already working groups looking at energy R&D such as in renewable energy and coal.

4. Promoting a Clean Environment

A fourth priority is the need to promote a clean environment. As economic growth charges ahead, there could be severe strains on our environment. We need to protect our forests, rivers, lakes and air quality. At the same time, the goals of economic development and environmental sustainability are not inconsistent. By adopting practical solutions such as pollution controls and traffic management, we can improve the livability of our towns and cities, as well as improve the well-being of the people.

Singapore’s Contribution

Singapore has taken over as ASEAN chair for the year ahead. Recognizing the importance of cooperation on energy security and climate change issues, we have chosen to focus on energy, environment, climate change and sustainable development as our themes for the ASEAN and EAS summits. While we recognize that ASEAN Member Countries are at differing stages of development and face different environment challenges, we hope that our efforts will help forge closer cooperation within ASEAN as well as with our regional partners in order to effectively address these global energy and environmental issues.

In the light of ASEAN’s 40th Anniversary, I am happy to note that ASEAN has been actively cooperating as a region on energy issues and is plugged in to the wider global network. Some highlights for this year that demonstrate the forward-looking nature of ASEAN are:

1. First, the signing of the MOU on the ASEAN Power Grid;

2.  Second, the hosting of the inaugural EAS Energy Ministers Meeting, thus broadening and deepening ASEAN’s energy cooperation with Australia, China, India, Japan, New Zealand and Republic of Korea;

3. Third, the beginning of a discussion on Nuclear Safety issues among ASEAN Member countries; and

4.  Last but not least, deepening discussions on these issues at a series of summit-level meetings such as ASEAN, and the EAS.

Conclusion

Ladies and gentlemen, ASEAN’s continued growth and prosperity hinges upon managing the competition for resources through cooperative efforts such as joint exploration and development of energy resources, more integrated markets, and sharing of expertise and technology. We need to foster closer dialogue and cooperation between members through avenues such as ASEAN, ASEAN+3, EAS and APEC. Although the challenges are immense, they are not insurmountable if we can strengthen our cooperation so that the region as a whole can benefit.

On this note, I wish all delegates a fruitful discussion and a pleasant stay in Singapore.