BENGALURU, India (AP) — Climate change is battering Asia’s water and energy systems and putting millions in harm’s way, forcing countries to pour billions into boosting basic services, according to two recent reports.
Water-related disasters are increasing across the region even as spending to protect communities is falling. Asian nations will need $4 trillion for water and sanitation between 2025 and 2040 – about $250 billion a year, the Asian Development Bank said in a report released Monday.
Governments are under increasing pressure to protect the energy systems that people rely on every day. By 2050, extreme weather could leave listed energy companies in the Asia-Pacific with about $8.4 billion a year in damage and lost revenue, a third higher than now, according to recent research by the Hong Kong-based non-profit Asia Investors Group on Climate Change and the New York-based MSCI Institute, a sustainability think tank.
Those risks have been playing out this year across Asia as it has been buffeted by late-arriving storms, relentless rain and flash floods.
In Quy Nhon in central Vietnam, power lines were cut when typhoon Kalmaegi blasted the coastal town with heavy rain and strong winds. Flooding from incessant rain left streets flooded days later, turning entire neighborhoods into islands. The day after the storm made landfall, Hai Duong, 29, ran to a mall that still had power to charge her phone.
“I can’t go back because my house is under water. I just want to see if my relatives are safe,” she said.
Asia’s water resources need to be protected from the climate
The ADB report says that 2.7 billion people, about 60% of the Asia-Pacific population, have access to water for most of their basic needs but more than 4 billion are still exposed to unsafe water, degraded ecosystems and growing climate hazards.
Much of the progress since 2013 has come from major gains in rural water access, he says. About 800 million more people in rural areas now have piped water, which helps many countries move out of the lowest level of water security. India played a big part in this change.
But Asia faces a triple threat: environmental pressures, low investment and climate change, said Vivek Raman, principal urban development specialist at ADB and lead author of the report.
“It’s a tale of two realities,” Raman said.
The report says water ecosystems were rapidly deteriorating or stagnating in 30 of the 50 Asian countries studied, affected by uncontrolled development, pollution and land being converted to other uses. Asia also accounts for 41% of global flooding and its coastal megacities and Pacific islands face increasing threats from increases in storm surges, rising sea levels and salt water pushing inland. From 2013 to 2023, Asia and the Pacific experienced 244 major floods, 104 droughts, and 101 severe storms – events that undermined development gains and caused widespread damage.
Governments currently meet only 40% of the estimated $4 trillion in investment, or roughly $250 billion per year, in funding needed for water and sanitation from 2025-2040. This leaves an annual shortfall of more than $150 billion.
Asia’s rapid growth is both an opportunity and a challenge, said Amit Prothi, director general of the New Delhi-based Coalition for Disaster Resilient Infrastructure, who was not involved with the report. “The amount of infrastructure that we will build in Asia in the next three decades will be equal to what was built in the last two centuries. So, this is an opportunity to think again and build in a new way,” he said.
The coalition found that $800 billion in infrastructure, about a third of it in Asia, is exposed to disasters each year globally.
Asia’s energy utilities are losing billions to climate change
Extreme heat, floods and water shortages are already costing Asia’s energy utilities $6.3 billion a year, a figure predicted to exceed $8.4 billion by 2050 if companies fail to strengthen climate adaptation measures, research from the Asia Investor Group on Climate Change and the MSCI Institute shows.
Asia accounts for 60% of the world’s power generation capacity and is still heavily dependent on coal. The report warns that climate change threatens both energy security and economic growth across a region where more than 4 billion people need reliable electricity.
“In general, if you were looking at the types of impacts and the preparedness of companies, most companies are in very early stages,” said Anjali Viswamohanan, director of policy at Asia Investor Group on Climate Change.
His study of 2,422 power plants across China, Hong Kong, India, Indonesia, Japan, Malaysia and South Korea found that extreme heat is the costliest hazard, responsible for more than half of all losses by 2050. Heat waves reduce the efficiency of power plant and tension transmission networks. India’s major power utility NTPC, Indonesia’s PLN, and Malaysia’s Tenaga Nasional all face a high risk of disruption caused by rising heat.
Water disturbance is a big factor
Another major threat comes from declining river flows in Asia’s major basins, which supply the water needed to fuel coal and gas plants and hydropower dams.
At the same time, heavy rains and floods also pose risks, especially in coastal and riverine regions. The report said Malaysia’s Tenaga Nasional faces some of the highest exposure to coastal flooding due to power plants built in low-lying areas.
Despite the increasing dangers, most utilities lacked detailed and funded plans for adapting to climate impacts. The report found that while nine companies out of the 11 studied have assessed how climate change affects them, only seven have examined the risks at individual plants. Only five have calculated and disclosed how future climate impacts could raise costs or hurt their profits.
Rapidly changing climate risks make it difficult to predict the costs and insurance needed to protect energy infrastructure, said Jakob Steiner, a geoscientist affiliated with the University of Graz, who was not involved in either report.
Financing gaps in the energy sector may be easier to close than those in water and sanitation, as energy projects can attract strong industry interest and investment, he said. But some countries discouraged by demands from international investors for environmental safeguards may turn to regional financiers who are less scrupulous about such concerns.
“For energy infrastructure, I see more hope that the funding gap can be closed,” he said. “But this can also come at a cost.”
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Ghosal reported from Hanoi, Vietnam. Follow Find Arasu on X above @sibi123 ___
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