ASEAN Power Grid delay could cost USD 2.6 billion yearly

MANILA — International experts on Oct. 9 urged the Association of Southeast Asian Nations (ASEAN) to focus its bid for energy security on accelerating electrification and renewable energy adoption, as recurring global supply disruptions and price shocks expose the region’s vulnerability to imported fossil fuels.

The call goes to the heart of what households and businesses pay for electricity and fuel, and how reliably they receive it. A region that depends on imported fossil fuels is exposed whenever global supply tightens or prices spike, and consumers and businesses absorb the cost.

For the Philippines, which chairs ASEAN in 2026, the question is immediate. President Ferdinand Marcos Jr. declared a state of national energy emergency on March 24 through Executive Order 110, citing the danger the conflict in the Middle East poses to the country’s energy supply.

Robert Cooke, grids and electrification advocacy lead at the Global Renewables Alliance (GRA), outlined the scale of the problem.

“Southeast Asia is expected to account for nearly one fifth of global energy demand growth to 2035. It is more urgent than ever that the region reduces its exposure to fossil fuel prices.

“The cost of this crisis is enormous. In the first six months of this crisis, fossil fuel importers have paid the equivalent of around USD 1.8 billion per day in additional costs, with the impact being felt by consumers and businesses.”

The forum, held by GRA and the Global Wind Energy Council (GWEC), followed the 44th ASEAN Ministers on Energy Meeting (AMEM) and the ASEAN Energy Business Forum (AEBF).

The ministers convened on Oct. 7 at the Philippine International Convention Center in Pasay City, chaired by Energy Secretary Sharon Garin.

The 9:30 a.m. forum, titled Power Huddle: What’s next for ASEAN Energy?, took place on Oct. 9 at the Admiral Grandsuites Ballroom of the Admiral Hotel at 2138 Roxas Boulevard in Malate, Manila.

Speakers urged ASEAN to center regional cooperation on renewable energy and electrification, including through grid expansion and integration via the ASEAN Power Grid (APG).

They also called for a rapid scale-up of solar, onshore and offshore wind, and energy storage.

The panel comprised Cooke; Atty. Monalisa Dimalanta, former chair of the Energy Regulatory Commission and the National Renewable Energy Board; Ann Francisco, Asia Pacific director of GWEC; and Russell Marsh, regional lead for Southeast Asia on energy transition and climate finance at the climate think tank E3G.

Rexor Amancio, GRA regional lead for Asia-Pacific, moderated the discussion.

ASEAN energy ministers affirmed the importance of renewable energy, energy storage, electrification of end-use sectors, and distributed energy resources in the region’s energy strategy.

They reiterated the targets set out in the ASEAN Plan of Action for Energy Cooperation (APAEC): a 30% renewable energy share in total primary energy supply and a 45% renewables share in installed power capacity by 2030.

The region faces a steep climb, however. The 9th ASEAN Energy Outlook, published by the ASEAN Centre for Energy and launched during the week of the meetings, shows the region needs to add 31 gigawatts (GW) of renewables every year until the deadline to achieve the 45% target.

The ASEAN Power Grid, which could help deliver more affordable electricity to the region’s 700 million people, remains central to regional energy cooperation.

ASEAN energy ministers reached a “consensus” to accelerate its development.

That consensus builds on the finalization of strategic workplans by the APG Task Forces, recommendations from the ASEAN Interconnection Masterplan Study III, and a new Regional Planning Framework to coordinate power system planning across the region.

Dimalanta said the grid must move beyond planning.

“The ASEAN Power Grid must move from lines on a map to projects that can be financed and built. A power grid, whether it’s regional or local, that exists only on paper will not keep the lights on.”

Cooke said the grid is central to the resilience of both national and regional systems.

“The ASEAN Power Grid is critical to strengthening the resilience of both the domestic grids of ASEAN Member States and the region as a whole. Expanded and modernised grids are fundamental to integrating greater volumes of renewable energy, whilst enhancing grid flexibility and stability.”

The urgency to move from planning to implementation is growing.

According to an analysis by the energy think tank Ember, every year of delay beyond the APG’s 2035 target could cost the region USD 2.6 billion in economic losses.

Cooke said the pace of delivery depends on partnership with industry.

“The progress we have seen so far is encouraging. To deliver these projects at the pace and scale needed, it is important that ASEAN works closely with industry to strengthen the essential regulatory and commercial frameworks to mobilise investment.”

GWEC said offshore wind offers a practical example of how renewable energy can support ASEAN’s wider priorities.

Generating electricity from domestic resources can help reduce exposure to volatile imported fuel prices, according to GWEC.

Project development also creates opportunities for local businesses, skilled workers, and coastal communities, the group said.

Francisco said the regional commitments matter because of what people and businesses need.

“ASEAN has taken encouraging steps towards a more connected and energy-secure region. These commitments matter because they are about what people and businesses need: reliable and affordable electricity, stronger local industries and more jobs. The opportunity goes far beyond generating electricity. Offshore wind can bring new business to our ports, shipyards, manufacturers and service providers. ASEAN already has many of these capabilities.”

Francisco said cooperation across the region can build on those existing strengths.

“Working together can help us build on those strengths and create more opportunities across the region. The conversations in Manila showed continued interest and a willingness to work together. We will keep working with industry, government agencies, banks and regional institutions to turn that cooperation into investment, infrastructure and lasting jobs.”

ASEAN electricity demand grew faster than the global average between 2015 and 2025, rising by over 60%, according to the International Energy Agency (IEA).

The growth highlights the urgency of the region’s goal to reach 100% electrification by 2035.

The AMEM and AEBF represented an important test of whether the region’s political direction and the urgency created by the current energy crisis will translate into concrete policy and investment decisions.

Marsh said the week’s discussions produced mixed results.

“In our view, the best way to secure ASEAN’s energy supply in the future is to transition away from fossil fuels, and to focus on clean electrification. I think whilst there has been progress on clean electrification and the deployment of renewable energy, there has also been this focus on securing fossil fuel supply in ASEAN. So I think my view is [there is a] mixed result from the discussions this week.”

Dimalanta said stockpiles offer only temporary protection.

“My fear is that stockpiles only buy us time. They do not remove exposure to volatile prices or imported supply. Every megawatt we produce with resources found locally is one less megawatt exposed to a shock generated abroad. The long-term answer is still more domestic renewable energy, electrification, storage, efficiency, and regional power trade.”

Marsh acknowledged the short-term logic of stockpiling but warned of a longer-term risk.

“On the stockpiling question, it’s obvious that right now, in the immediate energy crisis, it’s understandable that countries would focus on securing their energy supplies in the short term. I think the challenge and the risk is that [what] we do doesn’t get in the way of the medium- to longer-term need to transition away from fossil fuels and to move to clean electrification, and so that will be interesting to see how that develops.”

The region could take advantage of falling costs in solar, wind, and storage, as well as optimistic forecasts for increased renewables capacity.

GWEC’s Global Wind Report foresees over 900 GW in additional installed wind capacity by 2030.

The IEA said total renewable capacity in Southeast Asia could grow fivefold from the current 120 GW by 2035, based on announced targets.

Marsh questioned the outlook’s forecast for clean capacity.

“From our initial analysis, it looks like [the ASEAN Energy Outlook is] now forecasting less clean capacity deployed in that period than before, so we just want to [u]nderstand what has changed in ASEAN over the last year, [because] you would think that given where fossil fuel prices have gone, particularly gas prices have gone in the last 12 months, you would have thought that actually that would mean that there should be more incentive and mean you should see more renewable energy being deployed, as it would be cheaper than LNG.”

Dimalanta said emergency measures must become permanent systems.

“Government response is moving in the right direction. Stronger generator accountability, batteries, island grid expansion, microgrids, rooftop solar, a smart and green grid plan, and an oil and gas contingency plan. But emergency measures must become permanent systems before the next crisis. Reliability standards need teeth, reserve obligations must be transparent, and grid plans need firm deadlines and persistent, consistent monitoring.”

The Philippines is set to convene the 49th ASEAN Summit and Related Meetings on Nov. 16-18, where it is expected to further discuss the issue of energy security and the impacts of the Iran crisis.