34 ASIAN LEGAL BUSINESS – OCTOBER 2023 WWW.LEGALBUSINESSONLINE.COM ENERGY Given their geography and proximity to oceans, the ten countries comprising the Association of Southeast Asian Nations (ASEAN) are collectively one of the regions most vulnerable to the impact of climate change. Southeast Asia’s 688 million people are concentrated along coastlines, which are 173,251 kilometres long, leaving them exposed to rising sea levels. At the same time, the region’s heavy reliance on agriculture and fishing for livelihood makes it vulnerable to droughts, floods, and tropical cyclones associated with warming. In recognising these risks, countries have set ambitious targets to achieve net-zero greenhouse gas emissions, re-organise and revitalise their renewable energy sectors, and build a sustainable energy transition plan that involves a crackdown on coal, promoting carbon markets and inviting foreign investment and technology to plug emission leakages. This push to net zero has birthed a diverse variety of work for the region’s legal community, which is advising domestic and international stakeholders on compliance with new emissionfriendly regulations and high-stakes renewable projects and financing. Both the regulatory landscape and legal market are changing in the ASEAN’s biggest economies and emitters - Indonesia, Thailand, Singapore, Vietnam, and the Philippines – as they push to transform their energy mix, build renewable capabilities and come down hard on high-carbon industries. INDONESIA Indonesia, as the ASEAN’s largest economy by GDP and also its largest emitter, has committed under the Paris Agreement to reach carbon neutrality by 2060 or sooner, and increased its unconditional emission reduction target from 29 percent to 31.89 percent by 2030. To achieve these goals, the country has taken many steps towards energy transition, particularly in the field of carbon trading, explains Kirana D Sastrawijaya, senior partner and head of the power, energy and infrastructure group at Indonesian law firm UMBRA. In 2021, Indonesia rolled out its first carbon trading regulation that specifically regulates carbon trading as one of the carbon pricing mechanisms, together with result-based payment and carbon ASEAN countries’ commitment to meet ambitious emission targets, including fast-evolving energy regulation, development of carbon trading markets and innovative investment policies in the renewable energy sector, are bringing a new variety of work to lawyers in the region. BY NIMITT DIXIT THE RACE TO NET ZERO Image: Sansoen Saengsakaorat/Shutterstock.com
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