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In Indonesia, which still relies heavily on coal as its main source of energy, shifting to renewable energy is not an easy challenge. Achieving this goal requires strong planning, substantial investment, and policies that support communities affected by coal reduction.

The Institute for Essential Services Reform (IESR) conducted a study to understand public views on the Just Energy Transition Partnership (JETP) and various new energy technologies. 

Among the technologies studied, solar energy emerged as one of the most affordable and promising sources of energy, especially after significant developments. Read the report to find out more.

The Guide for Cross-Border Electricity Sales (CBES) serves as a comprehensive guide or framework in advancing ASEAN’s regional energy integration, facilitating power trade between Peninsular Malaysia and neighbouring countries, specifically Singapore and Thailand. The guide establishes two distinct schemes: the CBES Scheme, which governs non-renewable electricity exports, and the CBES RE Scheme, which enables the cross-border trade of renewable energy. Each scheme has its own set of regulatory requirements, infrastructure needs, and market mechanisms in shaping Malaysia’s role as an electricity exporter in the region.

This year’s International Women’s Day highlights the necessity to accelerate gender equality through actions, #AccelerateAction (IWD, 2025). Energy, one of the main GHG emitters, could be instrumental to fill the gap of gender disparity with the right approach to sectoral transformation. In this article, we will explore the nexus of gender and energy, and what actions can be taken to improve the energy sector to be more equitable and inclusive.

UN Women defines gender equality as “the equal rights, responsibilities and opportunities of women and men and girls and boys. It does not mean they will become the same, but their rights, responsibilities and opportunities will not depend on their sex/gender” (Source: UN Women Training Centre)

Gender – Energy interplay

Looking at the smallest unit of society – the family – women often play a central role as care workers, such as cooking, cleaning and taking care of children and elderly family members, especially in the ASEAN context. Providing them with access to clean energy not only prevents exposure to air pollution but also empowers them by leveraging their role from mere end-users to entrepreneurs or leaders for example, installing solar PV on their rooftop (ASEAN Centre for Energy, 2022), particularly women in rural areas who have been identified as a marginalised group. According to the latest ASEAN Gender Outlook, many households still rely on unclean fuels for cooking, particularly in Cambodia and the Philippines, where an estimated 15% and 17% of women, respectively, are at an inappropriate level of respiratory diseases risk due to this activity.

With depleting ecological resources and the climate crisis, the energy sector now requires transformation. Increasing diversity in the workforce and leadership positions has proven to drive more innovation, efficiency and sustainability in the sector. (UN Women, 2023). For instance, in the private sector, firms with more women represented in decision-making positions outperform those with fewer women (IEA, 2021). 

Therefore, integrating gender equality and diversity into the energy transition process should not be up for debate but a default setting.

The Glass Ceiling

Nonetheless, women’s representation in the energy sector remains limited. Globally, Women represent around 32% in the renewable energy sector and 22% in the fossil-based sector (IRENA, 2019). Women are still underrepresented in STEM jobs and senior management levels, constituting only about 14% of leading roles in energy firms (IEA, 2019). In the ASEAN region, women represented only 8% of the energy workforce (ACCEPT, 2024) – therefore the proportion of women in leadership roles would be even less. In terms of working conditions, there is still a 19% wage gap between women and men in the energy sector, which is greater than the non-energy sector. (World Economic Forum , 2022)

Referring to the activity “Women in Energy” where we convened women professionals in Thailand’s energy field to discuss their journey in the sector and the barriers preventing women from working in the field. There were many barriers which ranged from lack of awareness of opportunities (because the energy sector is viewed as STEM dominant) or self-perception (e.g. low self-confidence in their ability to understand technical issues) and technical discouraging working conditions e.g. safety, lack of policies to share care work. Apiradee Thammanomai, Director of the Strategy and Planning Division at the Department of Alternative Energy Development and Efficiency (DEDE), pointed out that “Women are forced to choose between career growth and family responsibilities”. Some women may refuse to take on a leadership role due to societal expectations that women should prioritise the family. These situations may undermine women’s representation in leadership positions in the energy sector, which could result in an unsustainable transition.

Shatter The Glass

Transitioning energy sector, from fossil-based to renewables, is not merely a climate solution but it could be an opportunity to address social disparity.To achieve this goal, mainstreaming gender into energy-related discussions is essential. There are several actions that can be taken by different stakeholders to enhance gender equality in the sector. Below are some examples:

Through Policies:

Gender mainstreaming in energy policy design: in the ASEAN context, the Roadmap on Accelerating ASEAN RE Deployment through Gender-Responsive Energy Policy was formulated in 2022, it aims to close the gender gap in RE sector and attract development finance through gender-responsive public policies. However, it can also be used as a reference to design gender-energy nexus policies. Another tool is a guideline for policymakers developed by the UNEP and UN Women, providing a step-by-step guide on how to integrate gender in energy policies.

Utilising gender toolkit or checklist developed for the energy sector: additionally, the Philippines Department of Energy has developed a Gender Toolkit for the Energy Sector, which equips policymakers and other stakeholders such as donor agencies, and the academic community with a guideline and checklist when designing energy programs or projects and MRV framework to monitor its impact. DOE also implements a policy to improve the number of women’s participation in RE sector by providing capacity building and technical assistance.

Ensuring a proportion of candidates are women or from marginalised groups: by doing so, it would guarantee diversity of the candidates and thus, more access to opportunities for marginalised groups. Indonesia enacted a law (Article 55 of Law 8/2012), that stipulates at least 30 percent of members of the House of Representatives candidates must be women.

Through Finance and Budget:

Inclusive financial support: by having budgets and investment plans that are designed gender-responsive e.g. initiatives to support women entrepreneurs, and Gender-responsive budgeting (GRB) can ensure the distribution of the cost of transition so that women benefit equitably. 

Through Education:

Promote enabling educational policies and programs: insufficient female representation in STEM jobs leads to a lack of female role models, therefore, at an institutional level, enabling policies and programs are required to promote educational and career opportunities for women.

Through the Workplace:

Workplace policies that help alleviate unpaid care work: for instance, flexible working hours, a working from home policy, daycare facilities for employees with young children.

Non-conscious bias training for the hiring unit and managers: tackling gender inequality can start by becoming aware of unconscious bias, which may influence the way we decide.

Energy could be instrumental to tackle societal gaps, including gender disparity, through improving wellbeing, to mainstreaming inclusion and diversity into different levels of decision-making. Addressing gender equality in the energy sector, therefore, requires a systematic approach at all levels by all stakeholders; it is everyone’s responsibility to #AccelerateAction.

*This blog was originally published on the website for the project Clean, Affordable, and Secure Energy for Southeast Asia (CASE).

A decade after the Paris Climate Agreement, Southeast Asia’s financial sector is increasingly focusing on supporting investments that contribute to decarbonization. Transition finance has emerged as a critical enabler, bridging the gap between today’s fossil-based economies and the clean energy future that governments and corporations aspire to achieve through their net-zero commitments.

In this exclusive conversation for SIPET Connect, Peter du Pont, Senior Advisor on the GIZ CASE project speaks with Anouj Mehta, Director of ADB’s Thailand Resident Mission. Mehta, who is the architect of the $2 billion ASEAN Catalytic Green Finance Facility (ACGF). shares insights on how transition finance can be scaled up effectively. With extensive experience in structuring financial solutions for green infrastructure, Mehta discusses the realities of mobilizing private capital, the role of development finance institutions (DFIs), and the innovations required to make transition finance work for Southeast Asia.

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SIPET Connect: Transition Finance is gaining traction globally, but how would you define it in the context of Southeast Asia? How does it differ from green or sustainable finance?

Anouj Mehta: Transition finance is fundamentally about mobilizing finance that can incentivize public and private sector entities to make the shift to much more resilient and environmentally sustainable practices than they currently deploy so as to lead to a much lower carbon footprint. This can be across all sectors whether in manufacturing, agribusiness, infrastructure, or services. Unlike green finance for projects that are immediately eligible and sustainable per green taxonomies, transition finance focuses on those hard-to-abate sectors, which require much more support in establishing a pathway towards the final goal of low emissions and resilience.

Southeast Asia has a complex energy landscape. Despite ambitious net-zero targets, the region remains heavily reliant on fossil fuels, particularly coal, which accounts for as much as 40% of power generation in many countries. The challenge is that many businesses, particularly in hard-to-abate industries like steel, cement, and transport, lack access to affordable financing to transition away from fossil fuels. This is where transition finance plays a crucial role. For example, it can facilitate the necessary financial mechanisms to support a range of investments, including:

1. Transition to a renewables energy mix;

2. Grid modernization to integrate intermittent renewables more effectively;

3. Energy efficiency improvements across industrial and commercial sectors;

4. Low-carbon transport systems including electrification of bus and rail networks; and

5. Risk-sharing mechanisms that encourage private investment in decarbonization projects.

This is where derisking or catalytic funds can make a difference. For instance, the ACGF aims to blend sovereign finance with funds from concessional donors so as to derisk green projects and hence attract commercial finance sources.

SIPET Connect: What role do Development Financing Institutions, or DFIs, play in structuring multi-donor transition finance mechanisms?

Anouj Mehta: DFIs are essential in creating viable financing structures that balance risk and return. Transition finance often involves investments that are not immediately commercially attractive, so DFIs could try and mobilize concessional finance, provide risk guarantees, and technical assistance to make these projects bankable.

Take ACGF, for example. We pool resources from multiple partners—ADB, the EU, Green Climate Fund, the UK, Germany’s KfW, and others—to create structured, multi-donor financing programs or projects. This approach ensures that projects in more challenging sectors, which often struggle to attract private capital, receive the bankability enhancement needed to move forward.

Good examples are emerging from the ACGF work which involves blending and derisking such as the Davao Public Transport Modernization Project in the Philippines which is the first project in the country to deploy electric bus fleets at scale, almost 1100 e buses, will service nearly 800,000 passengers daily, and targets a 60% reduction in the city’s urban transport GHG emissions– this could serve as a replicable pilot for the country and the region; other projects with great replication potential include the SDG Indonesia One green finance facility and Thailand focused GSS Bonds + program

SIPET Connect: What are the biggest bottlenecks preventing transition finance from scaling up in Southeast Asia?

Anouj Mehta: The availability of transition capital through locally available finance facilities that can be flexible and affordable is perhaps the biggest challenge. Traditional financing sources have yet to adapt to this need, with either being very commercial and focused on risk-return paradigms that do not allow untested transition innovation or very complicated public finance processes that might be slow in deployment and reach. Three other key challenges are:  

1. Low level of deployment of innovative transition finance instruments such as transition bonds or incentive-linked financing products

2. Lack of clarity especially at SMEs and SOEs on transition pathways and targets that need to be developed

3. There is often regulatory uncertainty, as the policy frameworks for transition finance are still evolving. Governments need to provide clear guidelines and incentives to de-risk investments.

All of this is why collaboration between DFIs, policymakers, and the private sector is critical. Countries that have taken a proactive approach—such as Thailand, which recently issued sustainability-linked bonds—are showing how transition finance can work when financial incentives align with decarbonization goals.

SIPET Connect: How do financial instruments like bonds contribute to transition finance?

Anouj Mehta: Bonds—particularly sustainability-linked bonds (SLBs)—are powerful tools to drive transition finance. Unlike traditional green bonds, which are tied to specific projects, Sustainability-Linked Bonds (SLBs) incentivize companies to meet sustainability targets by linking interest rates to performance. If a company fails to meet its targets, it pays a penalty through higher interest rates.

A case in point is Uruguay’s sustainability-linked bond model, which some of our ADB teams are adapting for under development projects and programs. This model ensures that borrowing costs remain competitive while encouraging long-term sustainability commitments. Similar structures could be applied across Southeast Asia to finance large-scale transitions in energy, industry, and transport.

SIPET Connect: What advice would you give to organizations looking to harness transition finance effectively?

Anouj Mehta: I feel, the change should start first with innovation in the technical approaches needed for your transition programs – whether energy mix or manufacturing process or logistics etc - and then look at what’s needed financially to make these approaches into bankable propositions. Identify the financing gaps and look at what governments and DFIs can offer to mitigate these gaps.

To make transition finance work, companies and governments need to do a few things.

1. Leverage blended finance models, using a mix of grants, concessional funding, and commercial capital to lower overall risk;

2. Demonstrate clear financial returns, so that investors can see a path to profitability, whether through carbon credits, efficiency gains, or regulatory incentives; and

3.  Finally, engage with policymakers early, since policy incentives, such as tax breaks or feed-in tariffs for renewable energy, can make or break a project’s financial viability.

SIPET Connect: Looking ahead, how do you see DFIs shaping transition finance in the next five years?

Anouj Mehta: Development Financing Institutions (DFIs) nationally and regionally, need to act quickly, innovate new financing products and instruments, and help build local capacities. If we’re serious about meeting net-zero targets, we cannot afford to move at the current pace. Some key areas for all development agencies to focus on include:

1. Accelerating approval processes for financing decisions;

2. Expanding risk-sharing mechanisms, such as Guarantee structures and first-loss capital must become standard for high-impact transition projects;

3. Scaling new financial instruments—we need more innovation in structured finance, such as sustainability-linked bonds, transition bonds, and hybrid debt models.

DFIs such as ours can help and I would urge more projects to look at the support available from catalytic funds and facilities such as the ACGF or the ADB’s recently launched Nature Solutions Finance Hub etc. The ACGF is leading the way – it has already impacted almost 50 green projects, catalyzed $ 7 bn of projects and innovating new concepts – whether over 15 thematic bonds already issued, green finance national facilities and more. This is the level of momentum we need to maintain.

Transition finance is not about replacing green finance; it is about complementing it—ensuring that industries and economies that are still carbon-intensive have viable pathways to sustainability. If structured correctly, transition finance can bridge the gap between climate ambition and real-world investment, making net-zero commitments more than just promises on paper.

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Editor’s Note: Transition finance is emerging as a critical tool to bridge Southeast Asia’s green ambitions with financial realities, ensuring that industries can decarbonize without disrupting economic growth. This interview highlights the key challenges—risk perception, slow capital deployment, and policy gaps—while also showcasing practical solutions like blended finance, sustainability-linked bonds, and risk-sharing mechanisms. As the region accelerates its net-zero transition, the insights here reinforce that success will depend on speed, scale, and smarter financial structures that mobilize both public and private capital effectively.

This publication examines the potential for renewable energy in Indonesia, which is at a pivotal point in the global energy transition. It highlights Indonesia’s unique opportunity to harness its abundant solar, wind, and hydro resources to drive economic growth, improve energy security, provide affordable electricity and achieve its climate commitments.

The study presents a comprehensive assessment of the country’s renewable energy potential and its economic viability, showing that at least 333 GW of economically viable renewable energy capacity is achievable. 

Authors: Dwi Cahya Agung, Martha Jesica Solomasi Mendrofa, Pintoko Aji, and Sodi Zakiy Muwafiq

This white paper is a collaboration between IESR, Telkomsel, and Periklindo that explores the evolution and future of the electric vehicle market in Indonesia. It highlights the growing urgency to switch to electric vehicles to achieve cleaner, cheaper, and more efficient mobility. It covers key topics such as the current state of EV adoption in Indonesia, challenges faced by consumers, government policies, and the role of advanced technologies such as IoT and telematics. It also provides insights into global EV trends, charging infrastructure development, and the economic impact of Indonesia as a global EV hub. The report emphasizes the importance of supportive policies, technological advancements, and ecosystem development to accelerate electric vehicle adoption and achieve sustainability goals.

As Thailand strides toward its 2050 carbon neutrality goal, innovative solutions are essential to balance energy demands, food security, and climate resilience. Enter agrivoltaics—a dual-use approach that integrates solar panels with agricultural activities. This blog explores how Thailand can harness agrivoltaics to transform its energy and agricultural sectors, drawing insights from a recent study by the project CASE and School of Renewable Energy and Smart Grid Technology (SGtech), Naresuan University.

What is Agrivoltaics?

Agrivoltaics combines solar energy generation with crop cultivation or livestock farming on the same land. By installing solar panels above or between crops, this system optimises land use, reduces water evaporation, and creates microclimates that benefit shade-tolerant plants. For Thailand—a nation with abundant sunlight and a strong agricultural base—agrivoltaics offers a pathway to sustainable development.

Why Agrivoltaics Matters for Thailand?

Economic Empowerment for Farmers

- Farmers gain additional income through solar energy sales or reduced electricity costs.

- Leasing land for solar installations provides financial stability, especially in regions with low agricultural yields.

Climate Resilience

- Solar panels mitigate heat stress on crops, conserve soil moisture, and reduce reliance on fossil fuels.

- Supports Thailand’s pledge to achieve 50% renewable energy by 2030 and net-zero emissions by 2065.

Land Efficiency

- Addresses land scarcity by enabling simultaneous food and energy production. Countries like Germany and Japan allocate 60-70% of agrivoltaic land to agriculture.

Rural Development

- Enhances infrastructure, promotes eco-tourism, and fosters innovation through farmer-academia-industry collaboration.

Thailand’s Policy Landscape: Opportunities and Gaps

While Thailand has policies supporting renewable energy (e.g., the Alternative Energy Development Plan) and sustainable agriculture, agrivoltaics lacks a dedicated regulatory framework. Key challenges include:

- Land Use Conflicts: Agricultural land zoning prohibits non-farming activities without permits.

- Grid Connectivity: Farmers face bureaucratic hurdles to sell surplus solar energy.

- Technical Knowledge: Limited awareness among farmers about agrivoltaics design and crop compatibility.

Global Success Stories: Lessons for Thailand

1. China: Scaling Agrivoltaics on Degraded Land

The 200 MW Jiangshan Agrivoltaic Park in Zhejiang Province combines solar panels with shade-tolerant herbs (e.g., Dendrobium orchids) and livestock zones. The project restored degraded, erosion-prone land while generating clean energy for 113,000 households.

Key Policies:

- Subsidies for solar projects on marginal or underutilised land.

- Integration of agrivoltaics into the 13th Five-Year Plan to maximise land efficiency.

Outcome: 90% vegetation cover reduced soil erosion, and farmers earned dual income from crops and energy sales.

Adaptation Tip: Thailand could replicate this model in its northeastern drought-prone regions, pairing solar with drought-resistant crops like moringa or medicinal herbs.

2. France: Balancing Energy and Agriculture with Strict Standards

French startups like Sun’Agri use dynamic solar panels that tilt to optimise light for crops. A vineyard in southern France reported a 12% increase in grape quality under panels due to reduced heat stress.

Key Policies:

- Decree No. 2024-318: Caps solar coverage at 40% of agricultural land and mandates <10% crop yield loss.

- Feed-in tariffs for small-scale projects (<500 kW).

Outcome: Over 300 agrivoltaic farms operate nationwide, with 1.2 GW installed capacity.

Adaptation Tip: Thailand could adopt dynamic panel technology for high-value crops like durian or mangosteen.

3. Italy: Agri-PV Meets High-Value Crops

The 70 MW Pontinia Solar Farm in Lazio integrates bifacial solar panels with olive groves and saffron cultivation. The project allocates 65% of land to agriculture while powering 47,000 homes.

Key Policies:

- National Recovery and Resilience Plan (PNRR): €1.1 billion allocated for agrivoltaics, covering 40% of project costs.

- Requires 70% of land to remain agricultural.

Outcome: Improved soil health and a 30% rise in saffron yields due to partial shading.

Adaptation Tip: Thailand’s orchards (e.g., lychee, longan) could benefit from similar partial-shade systems.

4. South Korea: Overcoming Land-Use Barriers

Pilot projects like the Rockport Blueberry Farm in Maine (USA collaboration) use elevated solar panels to grow blueberries, reducing water use by 20%.

Key Policies:

- Dual-Use Solar Energy Act: Allows temporary solar installations on agricultural land for up to 23 years.

- Exemptions for projects on saline or low-yield farmland.

Outcome: Farmers earn 3x more from energy sales than traditional farming.

Adaptation Tip: Thailand’s coastal salt farms could adopt similar models for solar-salt production synergy.

5. India: Community-Driven Agrivoltaics

The PM-KUSUM Scheme supports 10 GW of solar capacity on farmland, with panels elevated to allow crop growth underneath. In Gujarat, farmers grow turmeric and spinach under solar arrays.

Key Policies:

- Subsidies for solar pumps and grid-connected systems.

- Land conversion waivers for projects in arid regions.

Outcome: 40% reduction in irrigation costs and 25% higher crop yields.

Adaptation Tip: Thailand’s rice paddies could integrate solar panels during non-growing seasons to maximise land use.

Why These Models Matter for Thailand

Each success story underscores a critical lesson:

Flexibility: Agrivoltaics must adapt to local crops, climate, and land types.

Policy Clarity: Clear regulations on land use, energy sales, and farmer incentives are non-negotiable.

Community Buy-In: Farmers and rural communities must be central to project design and benefits.

By blending these global insights with Thailand’s agricultural strengths, the country can pioneer a tropical agrivoltaics model that boosts food security, cuts emissions, and empowers rural economies.

Policy Recommendations for Thailand

Cross-Sector Collaboration: Establish a multi-ministry taskforce (Energy, Agriculture, Environment) to streamline regulations.

Financial Incentives: Subsidise solar installations for farmers; introduce feed-in tariffs for agrivoltaics energy.

Land Zoning Reforms: Create a new land-use category for agrivoltaics, permitting dual-purpose activities.

Capacity Building: Train farmers in agrivoltaics best practices through university partnerships.

Pilot Projects: Launch demonstration farms in drought-prone regions (e.g., Northeast Thailand) to test crop-solar synergies.

The Road Ahead

Unlocking Thailand’s agrivoltaics potential requires proactive policies, strong stakeholder collaboration, and increased public awareness. By drawing insights from global leaders and adapting them to local contexts, Thailand has the opportunity to lead the region in sustainable energy and agriculture.

Policymakers: Integrate agrivoltaics into national energy and agricultural strategies.

Investors: Support pilot projects and invest in R&D for agrivoltaics systems suited to tropical climates.

Academics: Conduct research on crop-specific solar panel configurations and assess their impacts on local climate conditions.

*This blog was originally published on the website for the project Clean, Affordable, and Secure Energy for Southeast Asia (CASE)

Across Southeast Asia, the transition to clean energy is gaining momentum, but progress remains uneven. While countries have set ambitious net-zero targets, the region continues to rely heavily on fossil fuels, with coal and natural gas still dominating power generation. Thailand faces similar hurdles in its energy transition. While it has made strides in renewable energy deployment, it remains heavily dependent on fossil gas, which is still classified as a transition fuel in national energy plans.  

In this month’s SIPET Transition Finance Series, we speak with Sarinee Achavanuntakul, Managing Director of Climate Finance Network Thailand (CFNT), an independent research organization dedicated to advancing sustainable finance in Thailand and the region. Sarinee is a former investment banker, turned public intellectual and thought leader in the area of development broadly, and in recent years, she has focused more of her work on climate finance and sustainable investment.  Along with some colleagues, Sarinee set up CFNT last year.  She and her CFNT colleagues are working extensively on financial sector policies, corporate sustainability, and the risks of stranded assets related to Thailand’s energy transition. 

In this conversation with Peter du Pont, Senior Advisor to SIPET and Co-CEO of Asia Clean Energy Partners, Sarinee offers insights into the current state of transition finance, challenges banks face in aligning with climate goals, Thailand’s policy and regulatory barriers, and the role of disclosure standards and stranded asset risks in shaping the region’s financial future. 

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SIPET Connect: Transition finance is often discussed alongside green finance and sustainable finance, but its role in Southeast Asia’s energy transition is distinct. How would you define transition finance, and how does it differ from these other forms of climate-related financing? 

Sarinee: Transition finance is essential for economies shifting from high-carbon to low-carbon energy. No matter how much we promote green finance—which typically funds renewable projects like wind or solar farms—if most financial flows remain locked into fossil fuel infrastructure, the transition will stall. 

There are two key components to transition finance. The first is financing mechanisms that enable the shift away from high-carbon infrastructure, such as funding early coal plant retirements or repurposing fossil fuel assets into cleaner alternatives. A good example is Singapore’s transition credits1, which are designed to support early coal retirements. 

The second aspect is unlocking financial flows from fossil fuel investments and redirecting them toward clean energy. Banks and financial institutions play a major role here. Many have set net-zero targets, but for those goals to be meaningful, banks must provide a clear transition plan—showing how they will gradually phase down fossil fuel lending and scale up investments in clean energy. 

Unlike green finance, which focuses solely on funding projects already considered “green,” transition finance is about actively enabling the shift—by helping existing high-emission industries adapt, rather than simply supporting those that are already sustainable. 

SIPET Connect: What are the biggest challenges for banks in shifting away from fossil fuel lending? 

Sarinee: Banks are intermediaries—they don’t produce energy themselves but play a crucial role in allocating capital. This means that when a bank sets a net-zero target, which also includes the emissions from a company’s supply chain—or Scope 3 emissions—the real challenge is: Will their clients transition? If fossil fuel companies receiving financial support from banks don’t decarbonize, banks won’t meet their climate commitments either. 

Banks essentially have two choices when aligning with net-zero goals: 

Phasing out fossil fuel lending: This approach reduces exposure to high-carbon assets but is difficult because fossil-fuel-based businesses remain profitable and aligned with government policies. Banks that move too early risk being at a competitive disadvantage if their peers continue financing fossil fuel infrastructure and operations. 

Working with clients on decarbonization: Instead of cutting off financing, some banks engage with fossil fuel clients to help them develop transition plans. For example, Kasikorn Bank’s climate consultancy unit2 helps clients design decarbonization pathways while maintaining financial relationships. 

But even this approach has challenges. Bankers are not energy transition experts—they are experts in financial services. Providing technical decarbonization advice requires new skill sets, which take time to build. Additionally, banks need to integrate transition finance products that effectively incentivize clients to move toward cleaner energy sources. 

Ultimately, banks need clear policy signals and incentives to make transition finance scalable. Without strong regulatory direction, many financial institutions will hesitate to take decisive action. 

SIPET Connect: What are the financial risks of continuing fossil fuel investments? 

Sarinee: One of the biggest risks is stranded assets. Based on CFNT’s research, under different climate scenarios, the potential value of stranded fossil-fuel assets owned by Thai power producers could be valued between $10 billion and $15 billion.3 This is a major financial risk for banks that continue lending to fossil-fuel-based projects without a clear transition plan. 

Another looming issue is carbon pricing. While Thailand does not yet have a carbon tax for the energy sector, I believe it is only a matter of time before it is introduced. When that happens, gas-fired power will become even less competitive compared to renewables. If banks fail to anticipate this shift, they could end up with bad loans tied to fossil-fuel-based assets that are no longer profitable. 

Ultimately, financial institutions need to understand and integrate these risks into their lending strategies, rather than assuming fossil fuel investments will remain viable in the long run. 

SIPET Connect: Thailand’s power development plan still includes new fossil gas plants. How does this affect transition finance efforts? 

Sarinee: The slow progress in transition finance is largely due to the absence of a clear policy directive. In the most recent draft of Thailand’s Power Development Plan (PDP), while there are no new coal-fired power plants, there is still no official coal phase-out date or plan, and the PDP continues to include a substantial share of new fossil-based, natural gas plants. 

For commercial banks, this creates a dilemma. Many have financed gas companies for decades, and while they might set ambitious net-zero targets, they are operating in a policy landscape that still strongly supports natural gas. The government’s stance effectively signals that natural gas will remain a transition fuel for the foreseeable future. 

Thailand’s long-term Power Purchase Agreements (PPAs) for gas infrastructure guarantee fixed returns for fossil fuel projects, making them low-risk investments for banks. This financial certainty reduces incentives for banks to shift funding toward renewable energy, as renewable projects often lack similar guaranteed revenue streams under existing policies. With such financial certainty, banks have little incentive to prioritize renewable energy—despite the fact that wind and solar are now more cost-competitive. 

Without stronger policy signals—such as a carbon tax or regulatory frameworks that make non-transition projects more costly—banks will continue to finance fossil fuels, prioritizing financial security over the energy transition." 

SIPET Connect: There has been discussion about introducing a carbon tax and an Emissions Trading System (ETS) in Thailand. How would these impact transition finance? 

Sarinee: Thailand is exploring both options, but neither is fully implemented yet. A carbon tax could provide a clear price signal, but if it is set too low, it won’t drive real change. Similarly, an ETS could allow industries to trade emissions allowances, but its effectiveness will depend on how strictly it is enforced. 

If designed well, these mechanisms could push banks and corporations to invest in clean energy faster. But without strong regulatory backing, they risk becoming symbolic rather than transformative. 

SIPET Connect: How impactful are disclosure standards and green taxonomies in shaping transition finance? Can they meaningfully shift investor and bank behavior, or do they risk becoming just another reporting requirement? 

Sarinee: Disclosure standards alone are not enough. The real challenge isn’t just requiring companies to report their emissions—it’s whether investors, regulators, and financial institutions actually use that information to change financial flows. Right now, we’re still early in that journey. 

Fair Finance Thailand, a coalition co-founded by CFNT’s parent company Sal Forest, recently conducted a case study comparing climate disclosures from six Thai banks, and one of the biggest challenges they reported was assessing the quality of emissions data from their clients. This difficulty in monitoring, reporting, and verifying emissions isn't just a problem for banks—regulators and government agencies also struggle to standardize and compile credible emissions data across sectors. If banks don’t have reliable data, how can they accurately price risk or make strategic decisions around transition finance? 

On the regulatory front, Thailand’s Securities and Exchange Commission (SEC) has announced that it will mandate IFRS S1 & S24 climate disclosures5 for publicly listed companies, beginning with the SET50 firms in the coming years. This follows similar steps taken in Singapore and Malaysia, so Thai companies must now catch up. Meanwhile, the Bank of Thailand’s Green Taxonomy is also being introduced to help categorize financial flows. Both frameworks could help set new standards for how Thai banks approach climate risks and transition finance. 

However, the key question remains: Will these regulations actually change lending behavior, or will they simply add another compliance requirement with limited impact? Without strong policy direction and regulatory enforcement, disclosure runs the risk of becoming a box-ticking exercise rather than a real driver of change. If financial institutions are serious about transition finance, they need to go beyond reporting—they must actively integrate climate risks into credit decisions and capital allocation strategies. 

SIPET Connect: Can you tell us about Climate Finance Network Thailand (CFNT) 6and its role in advancing climate finance policies? 

Sarinee: CFNT is primarily a research organization, but the word “network” in our name reflects our goal of creating a community of practitioners interested in climate finance and sustainable development. Climate action is inherently complex and requires collaboration across multiple disciplines, so we aim to bridge knowledge gaps and foster partnerships that push Thailand’s financial sector toward more proactive climate action. 

Currently, CFNT focuses on climate finance research, with a particular emphasis on how financial institutions can be incentivized to shift away from high-carbon investments toward green and climate adaptation projects. We started with research on stranded asset risks, financing of the coal phase-out, and alternative financing mechanisms like crowdfunding for solar projects. Since banks in Thailand tend to be risk-averse in lending for renewables, we are exploring non-bank financing solutions that could expand access to clean energy. 

Additionally, we are expanding into tracking climate finance flows—analyzing where climate mitigation and adaptation financing originates and how it is deployed in Thailand. Adaptation finance remains a significant challenge because many of the most impactful projects do not yield immediate financial returns. Unlike mitigation projects—where cost savings can be quantified—adaptation projects benefit communities or reduce long-term risks for companies, making them harder to finance. We are working to address these gaps by developing methodologies for evaluating adaptation investments and advocating for policies that support long-term climate resilience funding. 

Through these research efforts and collaborations, CFNT seeks to drive meaningful changes in Thailand’s financial policy, ensuring that climate finance not only supports economic transitions but also delivers tangible benefits to society and the environment. 

SIPET Connect: Are you optimistic or pessimistic about scaling up transition finance in Thailand? 

Sarinee: [chuckles] I have to be optimistic to work in climate finance in Thailand! But there are real reasons to be hopeful. Unlike Indonesia, Thailand does not rely heavily on coal for power generation—we can literally count the coal-fired power plants still operating, and they account for about 20% of power generation. Many of them are old—15 years or more.  And many are state-owned, which means that Thailand could easily announce a date to reach a coal-free power sector and work toward that goal. 

Another promising factor is the rise of decentralized renewable energy. More and more Thais, facing severe droughts and floods, are questioning why their local governments lack control over energy decisions. If properly supported, renewables could strengthen energy democracy—empowering communities while lowering costs. 

However, for true progress, we urgently need stronger policy direction, a clear coal phase-out plan, and financial instruments that actively incentivize transition, rather than just maintain the status quo. 

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Editor’s Note: Sarinee Achavanuntakul presents a clear-eyed assessment of Thailand’s transition finance landscape—one that is filled with challenges but also ripe with opportunities. Thailand, along with the rest of the ASEAN region, face policy inertia, financial lock-in, and slow-moving bank strategies, but there is also growing market pressure for change. 

As the region grapples with rising energy costs, stranded asset risks, and evolving disclosure rules, the key question remains: Will financial institutions proactively lead the transition, or will they wait until market forces leave them with no choice?