Renewable Energy Manufacturing OPPORTUNITIES FOR SOUTHEAST ASIA R E N E W A B L E E N E R G Y M A N U FA C T U R I N G : O P P O R T U N I T I E S F O R S O U T H E A S T A S I A 1 ©2023 Asian Development Bank, Bloomberg Philanthropies, ClimateWorks Foundation, Sustainable Energy for All Sustainable Energy for All, Andromeda Tower 15th floor, Donau City Strasse 6, 1220, Vienna, Austria ISBN 978-92-9270-224-3 (print); 978-92-9270-225-0 (electronic) Published in August 2023. The views expressed in this publication are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. The mention of specific companies or products of manufacturers does not imply that they are endorsed or recommended by ADB in preference to others of a similar nature that are not mentioned. By making any designation of or reference to a particular territory or geographic area, or by using the term “country” in this publication, ADB does not intend to make any judgments as to the legal or other status of any territory or area. Note: ADB recognizes “China” as the People’s Republic of China. This work is available under the Creative Commons Attribution 3.0 IGO license (CC BY 3.0 IGO) https://creativecommons.org/licenses/by/3.0/igo/. By using the content of this publication, you agree to be bound by the terms of this license. For attribution, translations, adaptations, and permissions, please read the provisions and terms of use at https://www.adb.org/terms-use#openaccess. This CC license does not apply to materials in this publication whose copyright is owned by third parties. If the material is attributed to another source, please contact the copyright owner or publisher of that source for permission to reproduce it. The copyright holders of this publication cannot be held liable for any claims that arise as a result of your use of the material. R E N E W A B L E E N E R G Y M A N U FA C T U R I N G : O P P O R T U N I T I E S F O R S O U T H E A S T A S I A 2 Contents Exhibits, Case Studies, and Examples 4 Abbreviations 5 Statements from Partners 6 Introduction 7 Executive Summary 8 Chapter 1. A Strong Manufacturing Foundation 11 Chapter 2. Shining a Light on Solar PV: Opportunities in Southeast Asia 13 A. Solar PV Manufacturing Trends 13 B. Solar PV Manufacturing: Key Factors for Investment 18 C. Policy Interventions and Supporting Mechanisms to Unlock Opportunities 20 D. Solar PV Manufacturing: “Size of Prize” 23 Chapter 3. Charging Up the Battery Manufacturing Industry in Southeast Asia 25 A. Battery Manufacturing Trends 25 B. Battery Manufacturing: Key Factors for Investment 30 C. Policy Interventions and Supporting Mechanisms to Unlock Opportunities 32 D. Battery Manufacturing: “Size of Prize” 34 Chapter 4. Electric Two-Wheeler Manufacturing: The Race to Electrify Southeast Asia’s Streets 36 A. Electric Two-Wheeler Manufacturing Trends 36 B. Electric Two-Wheeler Manufacturing: Key Factors for Investment 39 C. Policy Interventions and Supporting Mechanisms to Unlock Opportunities 42 D. Electric Two-Wheeler Manufacturing: “Size of Prize” 44 Chapter 5. Power in Partnership: Exploring Opportunities for Regional Collaboration R E N E W A B L E E N E R G Y M A N U FA C T U R I N G : O P P O R T U N I T I E S F O R S O U T H E A S T A S I A 46 3 Exhibits, Case Studies, and Examples EXHIBITS Exhibit 1. $90 billion–$100 billion opportunity in low-carbon mobility and clean power by 2030 Exhibit 2. Southeast Asian countries are well-positioned to meet ambitious goals by 2030 Exhibit 3. Southeast Asia accounts for 9%–10% of global cell and module capacity Exhibit 4. Europe and Southeast Asia are likely most attractive future export markets Exhibit 5. Potential to expand regional demand with supportive regulations Exhibit 6. Solar PV demand in the Philippines is hindered by its grid infrastructure Exhibit 7. Southeast Asian production costs are 15%–35% higher than the PRC’s Exhibit 8. To date, battery cell manufacturing players have announced commitments in Southeast Asia, amounting to a 11 11 13 14 15 16 17 25 total of approximately 60 GWh capacity by 2030 Exhibit 9. The Indonesian government has indicated an aspiration to develop 140 GWh in b