Asia's burgeoning yet "grossly under-served" renewable energy sector spells opportunity for Singapore-based renewable energy developer and investor Equis, according to the firm's head honcho.
"Asia is the largest renewable energy market globally, but the pool of demand is just dwarfing what is being supplied," chief executive David Russell told The Straits Times in an interview on Tuesday.
Citing Bloomberg New Energy Finance figures, Mr Russell noted that Asia's renewable energy generation market is forecast to grow 73.7 per cent by 2020 - far higher than Europe or the United States.
This will be driven largely by the growing population and high urbanisation rates in the region, while governments, such as those in the Philippines and Thailand, review their energy policies, he said.
Equis, which finances as well as develops, constructs and/or operates renewable energy projects in Asia via six of its investee companies, has raised US$2.67 billion (S$3.75 billion) of equity since December 2011.
The firm has commissioned 24 such projects in the past three years, with 60 more under its belt. Its latest project in the Philippines, also the largest solar power plant in South-east Asia, is opening today.
The firm will keep expanding in its existing markets - Thailand, India, the Philippines, Japan - while entering new ones such as Indonesia, Taiwan and Australia.
Mr Russell said power purchase agreements are typically set in 20- or 25-year contracts at a fixed price, which gives the firm confidence to invest. It also helps governments lock in prices for longer periods, unlike with commodities.
"Because we have such strong business relations with governments, we've got to be long term.
" Once I have that golden location where I'm connected into the government's grid, I hold onto it as it's very hard to replicate that project and the relationships."
At the same time, Mr Russell believes Singapore is well-placed to play a critical part in the growing sector, specifically when it comes to building related technologies.
"The big game-changer for renewable energy is going to be battery storage," he said.
He noted that such technologies would enable a power producer to provide the population with a stable source of energy at any one time.
