Siemens Energy begins year of 'actions' in Southeast Asia

This article was originally published on Nikkei Asia.

German company targets cross-border grids, clean energy projects across region

JAKARTA -- Siemens Energy is calling 2024 a year of "actions" in Southeast Asia, targeting a range of projects, from cross-border power grids to wind power, in a region that is increasingly shifting to cleaner energy, the company's top regional executive told Nikkei Asia.

Thorbj?rn Fors, Senior Vice President for Asia Pacific at 西门子能源 , said awareness is growing across major Southeast Asian economies regarding renewables development after the Russia-Ukraine war triggered concerns over energy security.

Furthermore, recent progress with the Just Energy Transition Partnership (JETP), a climate financing program supported by Group of Seven (G7) nations that targets Indonesia and Vietnam, offers "some really good opportunities," Fors said.

"We see more and more countries now going from ... a planning stage into reality" in terms of their energy transition, Singapore-based Fors said in an interview earlier this month during a business trip to Jakarta. "This is the year where we're going to pursue the topics that have been discussed for the last few years. So it goes from planning to actions."

Siemens Energy, a global market leader in green energy, spun off from German technology group Siemens in 2020. Fors was appointed to his current position in January last year, leaving his previous job in Sweden as the executive vice president of Siemens Energy's industrial applications division.

The company is partnering with Singapore-based utility PacificLight Power Pte Ltd to use "cutting-edge" turbine technology to upgrade the latter's gas-fired power plants and make them "one of the most efficient" such facilities in Asia, Siemens Energy said in a statement.

Fors said improving the efficiency of gas-fired power plants is one of the company's key focuses in Southeast Asia, with gas being a key transition fuel and given the growing "momentum" in the region for upgrades to power plants to prevent them from becoming stranded assets while reducing their carbon emissions.

"Some of the low-hanging fruit is actually to improve what you have, right?" Fors said. "I think we cannot undervalue the importance of making sure that your existing assets are running at [their] best possible rate."

He said Siemens Energy also sees more opportunities in connecting the power grids of countries in the region, citing Singapore's plan to invest significantly in high-voltage direct current lines to import renewable energy from some of its neighbors.

"We do a lot of work around grid expansion, grid stability and sustainability around how you connect Southeast Asia beyond country borders," he said. "We ... see very prominent and very strong appetite [for that] also from governments and policymakers, and private investors."

In Indonesia, Siemens Energy opened a local office and signed a preliminary agreement with state utility PT PLN (Persero) last year to help it achieve a 23% renewable energy mix by 2025, up from around 13% in 2023. PLN is a key actor in Indonesia's $20 billion JETP plan, as it seeks early decommissioning of coal-fired plants to replace them with #renewables.

Fors also has high hopes for partnerships with private companies in Indonesia, mainly those building power-hungry smelters to process raw materials such as nickel and copper for use in cleantech applications such as electric vehicles and photovoltaic cells. Most such smelters are, ironically, powered by coal at present. Fors said Siemens Energy is helping Indonesian copper and gold miner PT Amman Mineral Nusa Tenggara replace its coal-fired power plant with a gas-fired one.

"Many parts of the world today will not accept a product that is produced with coal-fired power plants," Fors said. "So I think it's very much [in] Indonesia's interest to move as quickly as possible, transitioning from coal to, for example, natural gas or renewables."

He added Siemens Energy is also "building up" in Vietnam, which seeks to double its power generation capacity to 150 gigawatts by 2030 under its latest National Power Development Plan. That includes a phasedown of coal, major gas projects and a significant increase in wind power.

The company also sees opportunities in Malaysia with its National Energy Transition Roadmap released last year, which includes an ambitious target to increase the share of #renewables in the country's total energy supply to 70% by 2050.

Fors said he is also upbeat on hydrogen as "one of the key energy carriers of the future," and on wind turbines, despite troubles with Siemens Gamesa, its wind energy business in Europe.

He said the company remains "very active" with wind turbines in the Asia-Pacific region at large, including in India, where it recently signed a big order for wind turbines with TATA Power , and also in Australia.

Fors stressed that there is much "positive momentum in the wind industry. So we will continue to be very active in the wind business." He added that the company will also focus on "fixing our homemade problems."