Replacing fossils with renewables can save fuel costs: Experts

Mumbai: Replacing fossils with renewables can save fuel costs and stonewall against energy disruptions in Asia, experts said, noting that a renewables pivot supports macroeconomic stability in the backdrop of the ongoing war in West Asia.

The duration of the conflict between the US-Israel and Iran is unclear, but Asian countries are already responding with emergency energy security measures and economic interventions.

Crude oil and liquefied natural gas (LNG) rose 51% and 77%, respectively, between 27 February and 9 March 2026, according to a report of Institute for Energy Economics and Financial Analysis (IEEFA).

“The actual usage of LNG in Bangladesh and Pakistan dropped by 13-15% as a result of the 2022 crisis. But they ended up paying double. So the import bill for Bangladesh and Pakistan was double what it was before, despite using less. Even for a country like Japan, they had 3% less LNG available, but they paid 65% more,” said Ramnath N Iyer, Sustainable Finance Lead of Asia, IEEFA.

When we look at renewables as the alternative, we realized that a lot of these problems could have been avoided if many Asian countries had switched faster to renewables. Europe, to a large extent, did that after 2022, which is why the crisis doesn't seem to be as bad in Europe,” added Iyer.

“At the current prices of gas, we are looking at an LCOE of gas of about $130 per megawatt hour. Now, if you look at the global average for solar and for wind, that's about $40,” he added.

“The changes in energy prices might not capture the full extent of inflation, but reducing import dependence could really make the countries stabilize their economic growth. Replacing fossils with renewables can save fuel costs. In Thailand's case, looking at the projections by 2037, expanding solar and battery capacity could further unlock $1.8 billion savings from the fuel cost from gas. If this oil and gas powered volatility keeps going on for a prolonged period of time, there might be a widening of disparity between the more developed Asia and emerging economies in the region,” added Dinita Setyawati, Senior Energy Analyst of Ember.

“So renewables, grids, and storage could be the Holy Trinity solutions for the energy dilemma not only for ASEAN, but also for the whole Asia region,” he added.

“Because of the expansion of distributed solar in the country, especially in the power sector, LNG demand is not what it used to be back when these (LNG) contracts were signed. As of last year, the government has been looking to renegotiate contractual terms, cargoes have been diverted, and LNG is also being open to domestic consumers, because there's no need for those cargoes anymore as much, we don't have storage capacity, so the government has been looking for ways to get out of these contracts, change the terms, or divert them to other places. So this is something that has been happening even before the crisis unfolded,” pointed out Nabiya Imran, Associate on Energy Insights, Renewables First.

“We will increase our energy independence and energy security by using our local indigenous renewable energy resources. The World Bank already identified a lot of wind corridors in the Philippines, putting potential offshore wind capacity at 60 gigawatts all over the country.

That would power not only the whole country, we can also become an exporter of power to our neighbour ASEAN countries,” said Gaspar Escobar Jr, Grid Modernization Advisor of the Institute for Climate and Sustainable Cities (ICSC).