Delay in ASEAN power grid could cost region $2.6B/year

CEBU, Philippines — Southeast Asia risks losing billions of dollars in economic value if it fails to deliver a regional electricity network on schedule, as rising power demand and volatile fossil fuel prices intensify pressure on governments to strengthen cross-border energy trade.

An analysis by energy think tank Ember estimates that every year of delay beyond the ASEAN Power Grid’s 2035 target could result in $2.6 billion in economic losses for the region.

The proposed network is designed to allow member states to trade electricity across borders, share surplus generation and diversify supply sources, while enabling greater integration of renewable energy into national power systems.

Energy ministers have agreed to accelerate development of the grid, building on strategic work plans prepared by dedicated task forces, recommendations from the ASEAN Interconnection Masterplan Study III and a new regional planning framework intended to coordinate power-system development.

But turning those plans into operating infrastructure will require stronger regulatory arrangements, commercially viable projects and financing capable of attracting private-sector investment.

“The ASEAN Power Grid must move from lines on a map to projects that can be financed and built,” said Atty. Monalisa Dimalanta, former chair of the Energy Regulatory Commission and the National Renewable Energy Board.

The urgency is increasing as electricity consumption expands across the region.

ASEAN electricity demand grew by more than 60 percent between 2015 and 2025, according to figures cited at a forum organized by the Global Renewables Alliance and the Global Wind Energy Council.

Southeast Asia is also expected to account for nearly a fifth of global energy-demand growth through 2035, making the availability and affordability of electricity increasingly important to economic competitiveness.

Robert Cooke, grids and electrification advocacy lead at GRA, said expanded and modernized power networks are essential to accommodating renewable energy while improving the flexibility and stability of electricity systems.

Cross-border transmission could help countries manage differences in generation and demand, reduce dependence on imported fossil fuels and improve access to more affordable electricity for the region’s roughly 700 million people.

For the Philippines, stronger regional interconnections could complement domestic investments in renewable generation, energy storage and local electricity networks. The country remains exposed to international fuel-price movements, making diversification of electricity sources a priority for energy security.

Dimalanta warned that fuel stockpiles offer only temporary relief during supply disruptions and do not remove the underlying risks of import dependence.

She called for emergency measures to translate into lasting reforms, including clearer generator accountability, transparent reserve obligations, expanded island grids, microgrids and defined deadlines for grid modernization.

The investment requirements extend beyond transmission lines. Governments will need to coordinate power-market rules and commercial frameworks to ensure electricity can be traded reliably across borders and infrastructure projects can attract financing.

Renewable energy development could also create industrial opportunities. Ann Francisco, Asia-Pacific director at GWEC, said offshore wind could generate business for ports, shipyards, manufacturers and service providers while creating skilled jobs in coastal communities.

The Global Wind Report projects more than 900 gigawatts of additional installed wind capacity worldwide by 2030, underscoring the potential market for companies supplying equipment, infrastructure and services.

For ASEAN, however, the economic benefits will depend on whether governments can align energy policy, financing and infrastructure development quickly enough to meet rising demand.

The Philippines is scheduled to host the 49th ASEAN Summit and related meetings on Nov. 16-18, where energy security and the implications of the Iran crisis are expected to remain key issues.

The meetings will provide another opportunity for regional governments to advance cross-border electricity trade and turn long-standing integration plans into investment decisions.