Sustainable energy solutions are expensive. Michael Richardson asks whether they are worth the cost.

Since the industrial revolution started to gather strength in the mid-1800s in Europe and the USA, and later spread to Asia and the developing world, global use of fossil fuels (coal, oil and natural gas) and the clearing of forests for agriculture and cities have expanded exponentially.

According to estimates from the International Energy Agency, this has caused a sharp rise in releases of carbon dioxide, methane, nitrous oxide and other greenhouse gases into the atmosphere. In this environment, UN climate chief, Christiana Figueres, argues that governments “need to push the world further down the right track to avoid dangerous climate change.”

The Asian Development Bank warned in June that the energy requirements of the Asia-Pacific region, driven by strong economic growth, would double by 2030, and that continued reliance on fossil fuels would increase the threat of natural disasters and shortages in food and water in a region that was highly vulnerable to climate change.

Faced with the dual pressures to sustain economic growth and curb greenhouse emissions, countries and corporations are exploring a number of options. Some, such as Singapore, are exploring alternative and sustainable sources of energy. Other alternatives include energy conservation; fuel switching, from coal and oil to lower carbon gas use; renewable energy deployment; nuclear power; and carbon capture and storage.

Most of these measures are costly. A UN report on climate change reported in May that it could cost as much as US$12,000 billion, or close to 85 per cent of the entire US government debt, over the next 20 years to develop six renewable energy (RE) sources to help keep global greenhouse gas emissions in check.

However, with sustained investment and public policy support, the six: bioenergy, hydro, wind and solar power, and geothermal and ocean energy, could meet nearly 80 per cent of the world's primary energy supply by the middle of the century. Despite the high price tag, the authors of the Intergovernmental Panel on Climate Change report argue that a green-tech revolution could contribute to social and economic development around the world. Green technology could improve energy access for millions who lack sufficient electricity, light, heat and cooling; provide a secure energy supply; and improve the environment and public health.

The panel also noted that some RE technologies were already technically mature and broadly competitive with existing market energy prices. In Singapore, one of the most promising clean energy sources in the short-term is solar power.

Harnessing heat from the sun, direct solar energy technologies produce electricity using photovoltaics (PV) or concentrating solar power (CSP). Big sun-belt countries with lots of sparsely populated arid land, including Australia, South Africa, Spain and the USA, have developed CSP sun farms. PV farms in countries like China and Germany also generate grid electricity. However, like CSP complexes, they require large areas of spare land. In densely populated urban areas, PV energy can be accessed, as Singapore does, via rooftop panels on residential, commercial and public buildings.

Although intense international competition among manufacturers of PV cells and panels has driven prices down sharply in the past few years, current PV technology can only convert 16 to 20 per cent of energy into power. Research and development is improving performance and Singapore is implementing a large-scale solar test-bed atop public housing apartment blocks. This trial should enable the application of solar PV technology on a larger scale, if and when costs match or fall below the costs of gas-fired electricity.

The development of alternative energy sources remains vulnerable to the current global economic volatility. In the USA and Europe, its development depends on subsidies from heavily indebted governments that are trying to cut spending. This investment remains politically difficult while fossil fuels continue to remain affordable.

Nonetheless, sustainable energy options should continue to be explored. As China's Premier Wen Jia Bao said in Beijing at the start of this year, “We must no longer sacrifice the environment for the sake of rapid growth as that is unsustainable.”

Michael Richardson is a visiting senior research fellow at the Institute of South-East Asian Studies in Singapore and former South-East Asia correspondent of The Age. He has contributed to The South China Morning Post, The Asian Wall Street Journal and The Business Times.