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1、Climate Technology in Southeast Asia:Key to Unlocking the Worlds Carbon Sink August 2023By Yulius,Haikal Siregar,Kimberly Subianto,Dio Aufa Handoyo,Gerasimos Widi,Natalia Rialucky,Cecilia Natasya RachmanBoston Consulting Group partners with leaders in business and society to tackle their most import
2、ant challenges and capture their greatest opportunities.BCG was the pioneer in business strategy when it was founded in 1963.Today,we work closely with clients to embrace a transformational approach aimed at benefiting all stakeholdersempowering organizations to grow,build sustainable competitive ad
3、vantage,and drive positive societal impact.Our diverse,global teams bring deep industry and functional expertise and a range of perspectives that question the status quo and spark change.BCG delivers solutions through leading-edge management consulting,technology and design,and corporate and digital
4、 ventures.We work in a uniquely collaborative model across the firm and throughout all levels of the client organization,fueled by the goal of helping our clients thrive and enabling them to make the world a better place.Fairatmos is the first climate technology company in SEA to discover,develop,de
5、liver high quality carbon offset projects at scale.We are recreating the world where profit,people and the planet thrive together.We want to be the“steam-engine”of the Industrial Revolution to the Carbon Neutral Economy Reality.As how the steam engine ignited the industrial revolution,our AtmosTech
6、will mark the start of a carbon-neutral reality.We envision a future where a economic growth goes hand in hand with preserving the only planet we call home.A reality where high rise buildings are hidden beneath the greens of the forests,the air is clean while electricity is stable and where people,p
7、lanet,profit lives together.Our technology will create a future where carbon neutrality is a reality.Much like the steam engine that sparked the industrial revolution,our AtmosTech will be the engine that redefine the way we live towards a more sustainable,carbon-neutral era.Contents02 Introduction0
8、3 Why NbS presents a unique op-portunity for Southeast Asia to contribute to the global climate challenge07 Barriers to NbS uptake and how Southeast Asia climate technol-ogy startups are contributing to alleviating them 10 Unlocking the potential of Southeast Asias climate tech-nology startups12 Bus
9、iness-as-usual approach not enough anymorecall to action across stakeholders14 Conclusion2 CLIMATE TECHNOLOGY IN SOUTHEAST ASIA:KEY TO UNLOCKING THE WORLDS CARBON SINK IntroductionDespite covering less than 1%of the worlds total area,Southeast Asia has the capability to provide approximately 30%of t
10、he global carbon-offset supply by 2030.However,the widespread adoption of NbS in the region is hindered by various challenges across the value chain,including issues related to origination,demand visibility,and quality assurance.Encouragingly,the past five years have witnessed a remark-able rise in
11、climate startups within Southeast Asia.The number of these startups has tripled between 2022 and 20171,and they actively address various aspects of ecosys-tem challenges through the utilization of cutting-edge technology such as machine learning,data analytics,block-chain,and remote sensing.Neverthe
12、less,most of these climate technology startups are still in their nascent stages,with the novelty of the sector in the region and the small size of the specialized funding pool presenting significant barriers to maturity and widespread adoption.The unique nature of this space,with unproven markets r
13、equiring a higher risk appetite,necessitates the development of new,innovative mecha-nisms to overcome these hurdles.These mechanisms include alternative funding models,coalitions,and partner-ships that foster long-term collaboration among stakehold-ers.To expedite the uptake of NbS and climate tech
14、nology in Southeast Asia,the establishment of a thriving ecosystem is vital.This ecosystem should bring together technology providers,industry leaders,venture capitalists,financiers,and regulatory bodies.Through systemic collaboration and collective efforts,these stakeholders can drive the develop-m
15、ent,scale-up,and successful implementation of NbS in the region.This report delves into the exceptional potential of NbS in Southeast Asia as powerful tools in addressing climate change.We will explore innovative mechanisms around NbS neces-sary to usher in a sustainable future for Southeast Asia an
16、d the global community.SOUTHEAST ASIA HOLDS IMMENSE POTENTIAL IN COMBATING climate change through the implementation of nature-based solutions(NbS).1.NbS-related startups have been estimated as a subset of the climate tech deals collected by Pitchbook.29 such transactions were identified in 2022 vs
17、8 in 2017.BOSTON CONSULTING GROUP +FAIRATMOS 3NbS present unique and timely opportunities for Southeast Asia to contribute significantly to address-ing the global climate challenge.The world is currently failing to keep track with the targets outlined in 2015 Paris Agreement,which aimed to limit the
18、 global temperature rise to 1.5C from pre-industrial levels.From 2015 to 2020,the global decarbonization ratethe reduction in carbon intensity per unit of GDPwas just-1.5%,significantly short of the required-16%decarbonization rate needed by 2030 to maintain the 1.5C or below pathway.There is nearly
19、 a 50/50 chance that the critical 1.5C tem-perature threshold will be surpassed within the next five years.Southeast Asias rapid economic growth,while com-mendable,has come at the expense of high emissions that exacerbate these global challenges.This trend is expected to persist as the regions energ
20、y needs continue to grow in tandem with its expanding economy.Why NbS presents a unique opportunity for Southeast Asia to contribute to the global climate challenge4 CLIMATE TECHNOLOGY IN SOUTHEAST ASIA:KEY TO UNLOCKING THE WORLDS CARBON SINK The International Monetary Fund(IMF)projects that Southea
21、st Asia will be a key driver of global economic growth,with a projected real GDP growth of 4.6%by 2028,surpassing the global projection of 2.8%.This economic expansion corresponds to an increasing demand for energy in Southeast Asia,which has been growing at an average rate of approximately 3%per ye
22、ar over the past two de-cades.According to the International Energy Agencys(IEA)recent report,this upward trajectory in energy demand will persist until at least 2030.Despite the challenges associated with raising capital,there is a renewed commitment to green investments in Southeast Asia,demonstra
23、ted by governments and corpo-rations alike.Stakeholders are increasingly embracing the potential of NbS to address climate change and drive sustainable development.The region finds itself at a critical juncture where NbS offer a unique opportunity to contribute substantially to the global climate ef
24、fort.This is despite a decline in green energy investments,with US$5.2 billion invested in 2022,a 7%decrease from the previous year.Importantly,there are pronounced commitments from key players in the region.Singapore has earmarked US$17 billion for building climate change infrastructure.PTT Group i
25、n Thailand plans to allocate US$7 billion to green hydrogen projects,including the construction of a hydrogen plant.Contemporary Amperex Technology Co.Limited(CATL),a Chinese battery manufacturer and technology company,has committed US$6 billion for six electric vehi-cle battery projects in Indonesi
26、a over the next three years.In addition,Malaysian national oil company PETRONAS is expected to invest at least US$2 billion in clean energy projects in 2023.It is clearNbS stand out as potent tools in combating rising greenhouse gas(GHG)levels,and Southeast Asia is uniquely positioned to make an out
27、sized contribution.Exhibit 1.Exhibit 1-SEA is uniquely positioned with huge NbS Potential&cost competitive NbS carbon offsets1.Area refers to the sum of all land and water areas as determined by international boundaries and/or coastlines,cost-competitive is defined as under$10 2.High Range means the
28、 upper range of the carbon offset projected supply in 2030 3.Low Range means the lower range of the carbon offset projected supply in 2023Source:IEA,The voluntary carbon market:2022 insights and trends,CIA World Factbook,BCG AnalysisBOSTON CONSULTING GROUP +FAIRATMOS 5NbS can significantly contribut
29、e to achieving a net-zero world,with a maximum mitigation potential of 21.7 Gt CO2e/year,reducing projected emissions in 2030 by 60%.Approximately 4.1 Gt CO2e/year(20%)of this maximum mitigation potential,can be achieved at a cost of under US$10/ton CO2e.Out of said cost-competitive NbS maxi-mum mit
30、igation potential,projected global supply of NbS carbon offset by 2030 is estimated at 700 to 1,000 Mt CO2e/year.Southeast Asia possesses a considerable cost-competitive NbS mitigation potential of 1.2 Gt CO2e/year,accounting for 29%of the global NbS cost-competitive mitigation potential.Applying th
31、is ratio to the projected global NbS carbon offset supply,Southeast Asia is poised to offer 200 to 300 Mt CO2e/year of cost-competitive NbS carbon offsets by 2030.This is remarkable considering that the region encompasses only 0.7%of the worlds total area.The avoidance of forest,peat,and coastland c
32、onversion represents the three most significant NbS levers in the region.Exhibit 2.Forests play a vital role in offsetting carbon emissions,and avoiding forest conversion is estimated to be the largest NbS lever in Southeast Asia,potentially offering cost-com-petitive carbon offsets of 89-133 Mt CO2
33、e/year.Better forest management and reforestation can contribute to carbon reduction and removal,although the high costs associated with reforestation make it less feasible for cost competitive carbon offsets in Southeast Asia.Southeast Asias peatlands account for over 54%of the worlds peatlands and
34、 store 75%of global peat carbon stocks.However,peatlands are often drained and cleared for development or converted into plantations,lowering the water content which renders them susceptible to fires.This contributes to the highest GHG emissions from forest-ry and other land use(FOLU).By preserving
35、peatlands,carbon emissions can be reduced and removed,offering a potential NbS lever of 58-87 Mt CO2e/year.Coastal wetlandsseagrass meadows,intertidal flats,tidal salt marshes,mangrove forests,tidal freshwater wetland,and similarare essential for carbon sequestration.Coast-al wetlands are among the
36、most utilized and threatened natural systems,with a global area loss in some countries Exhibit 2-Avoidance from forest conversion,peat conversion,coastland conversion are the 3 biggest NbS levers in SEANote:High Range means the upper range of the carbon offset projected supply in 2030.Low Range mean
37、s the lower range of the carbon offset projected supply in 2023Source:The voluntary carbon market:2022 insights and trends,BCG Analysis6 CLIMATE TECHNOLOGY IN SOUTHEAST ASIA:KEY TO UNLOCKING THE WORLDS CARBON SINK over 70%-80%in the last 50 years.Avoiding conversion in peatland and coastland represe
38、nts the second and third largest NbS levers in Southeast Asia,with the potential to remove 58-87 Mt CO2e/year and 25-37 Mt CO2e/year of emissions,respectively.While peatland restoration can provide cost-competitive offset potential,the high costs associated with coastland restoration make it more ch
39、al-lenging to achieve.Agricultural land has a lower NbS carbon offset projection compared to forests and peatlands.While accounting for 14%of total global carbon emissions,six out of ten ASEAN member states(Cambodia,Indonesia,Laos,Myanmar,The Philippines,and Vietnam)are heavily reliant on the agricu
40、l-tural sector for economic growth.However,this lever has a low NbS carbon offset projection compared to wetlandspeatlands and coastal wetlandsdue to shorter carbon residence time and lack of plant diversity,limiting its capaci-ty for carbon sequestration as agricultural cultivation takes place.More
41、 importantly,implementing improved rice culti-vation,conservation agriculture,and other agricultural solutions can contribute to carbon reduction and removal,offering a combined potential of 8-13 Mt CO2e/year.In Southeast Asia,Indonesia emerges as the country with the largest potential for NbS,close
42、ly followed by Malaysia and Myanmar.The primary NbS levers in these countries align with the overall regionavoiding peatland,forest,and coastland conversion.Indonesia holds immense potential in avoiding peatland conversion while Malaysia and Myanmarboth countries with expansive forested areas and va
43、st land massesex-hibit significant potential in avoiding forest conversion.Exhibit 3.Exhibit 3-SEA NbS Carbon Offset Supply is huge and Indonesia is poised to contribute to 67%of total projected supplyNote:Singapore and Brunei are excluded from the chart due to its minimum NbS potential contribution
44、.Indonesias low-range figure is 134 Mt CO2e/year&high-range figure is 201 Mt CO2e/yearSource:The voluntary carbon market:2022 insights and trends,BCG AnalysisBOSTON CONSULTING GROUP +FAIRATMOS 7Barriers to the widespread adoption of NbS in South-east Asia are impeding the realization of the regions
45、enormous carbon offset potential.These barriers span the entire carbon offset value chain,and are catego-rized as follows:(1)Origination,(2)Quality assessment&assurance,(3)Trading,and(4)Demand Generation.Origination Lengthy and uncertain project development process.NbS projects face prolonged develo
46、pment timelines and un-certainties,compounded by the multitude of registries,standards,and methodologies.Asset owners struggle to navigate these complexities,especially smaller landown-ers.Limited seed financing for projects.NbS projects lack suit-able financing options with appropriate time horizon
47、s,standardized asset characteristics,and liquidity profiles,deterring potential investors.Barriers to NbS uptake and how Southeast Asia climate technology startups are contributing to alleviating them8 CLIMATE TECHNOLOGY IN SOUTHEAST ASIA:KEY TO UNLOCKING THE WORLDS CARBON SINK Quality assessment&as
48、surance Complex MRV requirements.The value of carbon credit hinges on accurate measurement,reporting,and verifi-cation(MRV)processes that demonstrate the real and substantial removal of carbon.However,the data anal-ysis involved in MRV necessitates significant resources,including on-site surveys and
49、 verification,leading to time and cost burdens.Incomprehensive assessment.In addition to environmental impact,the social benefits of NbS projects on rural and coastal communities often go unnoticed.An all-encom-passing assessment of these projects can enhance the value of carbon credit generated.Qua
50、lity audit and certification.Carbon credits require robust and non-fungible certifications to instill trust among prospective buyers on primary and secondary carbon credit markets.The certification process must be transparent and reliable.Trading Price stability and market mechanisms.Advanced tech-n
51、ologies are vital for facilitating cost-effective trading and building liquidity in nascent carbon credit markets.These technologies enable efficient asset exchange and ensure market stability.Lack of long-term demand and pricing visibility.Entrepre-neurs and investors rely on long-term demand and p
52、rice indicators in carbon credit markets.Trading future contracts and securitizing digital carbon assets through tokenization and legal structuring,as seen in established commodity markets,are essential for the markets long-term viability.Demand Generation Buyer-side demands clarity.The demand for c
53、arbon credits relies on buyers abilities to assess their carbon emis-sions accurately.Advanced technologies such as AI/ML,IoT,and edge computing are instrumental in automating carbon footprint assessments.Platforms in Southeast Asia are providing real-time visibility and automation to boost buyer de
54、mand.Southeast Asias climate technology startups are address-ing these barriers head-on,developing innovative solutions to streamline the origination process,enhance quality assessment and assurance,ensure credible certifications,facilitate efficient trading,and generate demand through technological
55、 advancements.The growth of the climate technology landscape in Southeast Asia has been remarkable,with more than triple the number of deals observed in 2022 compared to 2017.Over half of these deals directly or partially address the NbS sector,high-lighting its importance.Some examples of the innov
56、ative technology employed are mapped below.Exhibit 4.Exhibit 4-Startups and projects across SEA have started addressing barriers for broader NbS uptakeBOSTON CONSULTING GROUP +FAIRATMOS 9As we examine the landscape,two notable observations emerge:Verticalization.Startups are moving towards further v
57、erticalization,capitalizing on synergies in the maturing climate technology space.For instance,Pachama,a Latin American climate startup,initially focused on carbon off-set verification using satellite imagery and AI.Over time,it expanded its offerings along the value chain,launching a carbon credit
58、marketplace in 2019.Recently,it has introduced partnership models to support forest carbon projects from inception,leveraging technology to assess land potential,secure upfront financing,and monitor forest growth.Extending ecosystem.Climate technology extends beyond startups.Think tanks,non-governme
59、nt organiza-tions(NGOs),and research institutions have long been pioneers in climate and environmental protection.They have developed advanced climate technology solutions that startups and other players can leverage.Notable examples include Global Forest Watchs widely used solutions for MRV and cli
60、mate monitoring,as well as World Wildlife Federations(WWF)Forest Foresight tool.In the dynamic landscape of climate technology in South-east Asia,several startups have emerged as key players,leveraging innovative solutions to address climate change and advance NbS.Fairatmos,based in Jakarta,is a tec
61、hnology platform that sources,verifies,and connects carbon projects with compa-nies seeking to offset their carbon footprint.Using rigorous standards and advanced technologies,including deep learning and real-time satellite data through its Atmos-Check product,Fairatmos ensures the integrity of carb
62、on projects listed on its platform.It also provides advisory and seed financing services to support carbon offsetting proj-ects.With a deep understanding of the local context and expertise,Fairatmos is unlocking the power of nature for the planet and communities.To date,Fairatmos has collab-orated w
63、ith over 100 companies,communities,and govern-ments,processed more than 3,000,000 hectares of forest for NbS potential,and facilitated fundraising of climate projects worth over US$18 million.An exemplary project is its partnership with Lindungi Hutan,assisting a local com-munity in planting and reh
64、abilitating mangroves in Central Java.With the help of Fairatmos free pre-feasibility study powered by AtmosCheck technology,the project has gener-ated over US$3 million in funding interest and is currently in the project development process.Climate Impact X(CIX)is a global marketplace for trusted c
65、arbon credits,and another key example of a startup with a compelling,climate-focused proposition.Headquartered in Singapore,CIX collaborates with innovative partners and leverages Singapores financial,legal,and commodities hub infrastructures to build resilient platforms.CIX ensures the secure and e
66、fficient trading of carbon credits by relying on technology-powered tools,including satellite surveil-lance,to monitor the projects from which the credits are sourced.Jointly established by DBS Bank,Singapore Ex-change,Standard Chartered,and Temasek,CIX fosters ecosystems that enable companies to ta
67、ke practical cli-mate mitigation action through trusted carbon credits.Its aim is to create a seamless trading experience that serves the diverse needs of both buyers and sellers in the carbon market.Finally,Pantas is a platform launched by Bursa Malaysia and the London Stock Exchange Group,offering
68、 technolo-gy-enabled tools to help companies in aligning their car-bon emissions reporting with global standards.10 CLIMATE TECHNOLOGY IN SOUTHEAST ASIA:KEY TO UNLOCKING THE WORLDS CARBON SINK Climate technology solutions,including those devel-oped by startups,hold immense potential to address the b
69、arriers hindering the widespread adoption of NbS in Southeast Asia.However,most of these startups are still in the nascent stage,impeding their growth and im-pact.To fully unlock the potential of climate technology,they must mature and achieve widespread adoption.This re-quires overcoming key barrie
70、rs faced by climate technology players:Wide range of market demands.The climate technology space is still in its early stages,necessitating new prod-ucts to prove their safety,reliability,affordability,and scalability.Demand is still fluctuating as a result of the nascent market conditions.Long inve
71、stment horizon for institutional investors.Develop-ing technologies carry an inherent risk,and potentially offer longer pathways to returns on investment.Without proper incentives,companies are hesitant to invest in these technologies.It is crucial to create an appealing risk-return profile for inst
72、itutional investors to attract investment in climate technology.Insufficient value proposition for corporate buyers.Some climate technology solutions come at a cost premium without providing additional functional benefits as they scale.To drive adoption,adopters need to be willing to pay this premiu
73、m,necessitating a strong value proposi-tion for corporate buyers.In BCGs publication,Ushering in the Next Generation of Climate Technology,innovative mechanisms are identified to accelerate the development and scaling of climate technology:Funding mechanisms Advanced market commitments(AMC).Similar
74、to vaccine development schemes,AMCs send a strong demand signal to technology developers without favoring any particular technology.A pool of money is committed to purchasing large quantities of the product at set prices,incentivizing climate technology companies to invest in R&D and commercializati
75、on efforts while reducing risks with guaranteed future market payouts.An example is Frontier Climate,which committed nearly US$1 billion to develop carbon removal technologies between 2022 and 2030.Concessional finance.This financing approach offers be-low-market interest rates or more flexible term
76、s to bene-fit the greater good and catalyze third-party investment.Breakthrough Energy Catalyst,founded by Bill Gates,raised US$1.5 billion by engaging with governments,philanthropic organizations,and public-private part-nerships.The concessional nature of the capital helps address financial risks a
77、nd uncertainties associated with early-stage clean energy projects,enabling the realiza-tion of projects that may not otherwise attract sufficient investment.Offtakes,volume guarantees,and pooled procurement.Capital is deployed when technology is available for purchase,reducing financial risks for c
78、ompanies during production scale-up.Companies can purchase offtakes and volume guarantees through pooled procurement,leveraging higher purchasing power and ensuring supply security.For example,the Clean Energy Buyers Associa-tion offers opportunities for pooled procurement in the region.CoalitionsCo
79、llective pledges and commitments by organizations,formalized through coalitions,send clear demand signals to the market for climate technologies.This helps shape the market attractiveness for investments.The First Mov-ers Coalition is a prime example,through which 50%of companies are committed to de
80、carbonizing seven hard-to-abate industrial sectors by adopting clean energy technolo-gies.Government/policy/regulationsCompanies and investors can advocate for policy mecha-nisms and collaborate with governments and regulators to shape policies that create a conducive investment land-scape for clima
81、te technology.This involves setting up suitable incentives and streamlining permits and regula-tions.Unlocking the potential of Southeast Asias climate technology solutionsBOSTON CONSULTING GROUP +FAIRATMOS 11In the face of the escalating climate crisis,the traditional“business-as-usual”approach is
82、no longer sufficient.A collective call to action is needed across stakeholders to drive meaningful change.Recommendations for Corporate Buyers and Indus-trial LeadersCorporate buyers/industrial leaders should embed the climate lens into the companys core strategy.It is essen-tial for companies to go
83、 beyond treating climate action as a nice-to-have and instead integrate it into their core business strategy.This involves defining emission base-lines,developing transition plans,and reducing emissions across their operations and supply chains.Climate strate-gies should guide investment decisions a
84、nd procurement choices.GoTo Group,an Indonesian digital company,exemplifies this approach by setting sustainability commitments and embedding them within its long-term strategy.It is transi-tioning to a 100%electric vehicle(EV)fleet by 2030 and has established an EV joint venture to accelerate EV ad
85、op-tion in Indonesia.Companies should actively participate in market-shaping initiatives such as AMCs,coalitions,offtake agreements,and pooled procurement.By doing so,they send a strong demand signal to the market,incentivizing the develop-ment and scaling of climate technology solutions.Look also t
86、o invest in experimentation and risk-taking.Recognizing that climate technology requires an experi-mentation mindset and risk appetite,companies should allocate resources and budget for research and develop-ment in partnership with technology players.Olam,for instance,is at the forefront of integrat
87、ing digital applications with climate action.It has introduced the AtSource application,providing sustainability insights to customers across agricultural supply chains,and the Olam Farmer Information System,which leverages GPS and survey data to provide farmers with better insights and reporting.Re
88、commendations for Investors,VCs and Financiers and Industrial Leaders Put climate technology at the forefront,recognizing that it requires long-term commitment and sustained attention.Investing in climate technology is not the same as invest-ing in short-term,consumer-focused platforms.It demands a
89、deep understanding of the sector and a willingness to support solutions that address the pressing challenges of climate change.Look to build innovative financing instruments.Traditional financing instruments often fall short in meeting the needs of climate technology developers and financiers due to
90、 the unattractive risk-return profiles.To bridge this gap,innova-tive financing instruments such as blended financing and climate project insurance are essential.Blended financing,for example,combines concessional capital with traditional investment to de-risk early phases of projects,catalyzing fur
91、ther investments when the project becomes financially attractive.These instruments help attract more capital and unlock the potential of climate technology.Incorporate climate metrics in investing and lending pro-cesses to drive visibility and ownership of climate-related risks and opportunities,int
92、egrating climate metrics into core investing and lending processes.This involves assess-ing climate-related risks and opportunities alongside finan-cial considerations.By setting internal targets and incorpo-rating climate metrics,investors can prioritize climate-conscious investments and ensure ali
93、gnment with sustainability goals.Not discounting the need to effectively navigate the climate technology landscape,investors should also invest in building internal capabilities and expertise in the field.Recommendations for Technology and Project OwnersThe traditional linear path of product develop
94、ment,pro-duction setup,and commercialization is no longer suffi-cient.Instead,we must foster an ecosystem that enables parallelization and collaboration among various stakehold-ers.Climate technology providers and project owners play a crucial role in strengthening collaboration within the eco-Busin
95、ess-as-usual approach not enough anymorecall to action across stakeholders12 CLIMATE TECHNOLOGY IN SOUTHEAST ASIA:KEY TO UNLOCKING THE WORLDS CARBON SINK system.They should actively engage with industry leaders and seek partnerships with other technology providers.By working together,they can levera
96、ge their expertise and resources to accelerate the development and adoption of climate solutions.A notable example is Fairatmos,which has created a com-prehensive platform comprising products like AtmosCheck,AtmosFund,and the Marketplace.This platform brings together a diverse ecosystem of communiti
97、es,project developers,financiers,and buyers,facilitating the develop-ment and funding of carbon offset projects.By connecting stakeholders and fostering collaboration,Fairatmos is driving innovation and progress in the climate technology space.Recommendations for Governments and RegulatorsGovernment
98、s should set ambitious targets and pledges.Building upon previous commitments made in COPs and the Paris Agreement,governmental commitments provide a strong signal of support and encourage the growth of carbon markets,fostering innovation and investment in climate technology.Streamlining policies,pe
99、rmits,and regulations is essential.Governments need to create clear and efficient processes that facilitate project development and investment.By removing unnecessary barriers and simplifying bureaucrat-ic procedures,they can create a favorable climate for proj-ect owners and investors to navigate a
100、nd invest in climate solutions.Work to establish frameworks and systems that support the growth of climate technology.It is crucial to strike a balance between necessary regulations and fostering innovation.Governments should ensure that regulations do not stifle the development and deployment of cl
101、imate solutions,enabling companies to thrive and contribute to the transition to a low-carbon economy.Necessitate the improvement of monitoring systems and enhancing data and information sharing across the ecosys-tem.Governments should invest in robust monitoring mechanisms to track the progress and
102、 impact of climate technology projects.Sharing data and information trans-parently will facilitate collaboration,knowledge exchange,and informed decision-making.Providing incentives as a safety net for financiers is also important.Introducing financial incentives,grants,and subsidies that mitigate r
103、isks and support the development and scaling of climate technology solutions will give finan-ciers the confidence to move forward with climate technol-ogy investments.Exhibit 5-No Longer Business As Usual,a call to action across stakeholdersBOSTON CONSULTING GROUP +FAIRATMOS 13Harnessing the transfo
104、rmative power of climate tech-nology and NbS is imperative to combating climate change and unlocking the vast carbon sink in South-east Asia.While the region holds immense potential,real-izing its full benefits requires decisive action from all stake-holders.At this critical juncture,climate technol
105、ogy startups in Southeast Asia face significant obstacles on their path to maturity and widespread adoption.Addressing these chal-lenges necessitates innovative funding mechanisms that attract investment,de-risk projects,and catalyze growth.Advanced market commitments and concessional finance can se
106、rve as powerful tools to incentivize participation and foster sustainable innovation.Collaboration and partnerships within the ecosystem are paramount.By uniting companies,technology providers,and economic stakeholders,we can leverage expertise,resources,and the expert know-how to drive effective so
107、lutions.Governments and regulators must also play a leading role in setting ambitious targets,streamlining policies and regulations,and offering incentives that ignite sustainable development.Together,we have the power to unlock Southeast Asias climate technology potential and create a sustainable f
108、uture.The time for collective action is now.Conclusion14 CLIMATE TECHNOLOGY IN SOUTHEAST ASIA:KEY TO UNLOCKING THE WORLDS CARBON SINK About the Authors Yulius is a Managing Director&Senior Partner in BCGs Jakarta Office.You may contact him by email at Haikal Siregar is a Managing Director&Partner in
109、 BCGs Jakarta Office.You may contact him by email at Kimberly Subianto is a Project Leader in BCGs Jakarta Office.You may contact her by email at Dio Aufa Handoyo is a Project Leader in BCGs Jakarta Office.You may contact him by email at Gerasimos Widi Primanda Singarimbun is an Advisor in BCGs Jaka
110、rta Office.You may contact him by email at Natalia Rialucky is a CEO and Founder in Fairatmos.You may contact her by email at Cecilia Natasya Rachman is a Strategy&CEO Office Analyst in Fairatmos.You may contact her by email at Boston Consulting Group partners with leaders in business and society to
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