Jakarta—Southeast Asia is on track to become the world’s fourth-largest economy by 2050, driven by rapid economic growth and rising energy demand. However, according to the Institute for Essential Services Reform (IESR), the region must address the challenge of aligning its economic expansion with the need to reduce carbon emissions.
In a recent statement, IESR highlighted the region’s significant renewable energy potential, estimated at 17 terawatts (TW), as a crucial asset for achieving net-zero emissions (NZE) in the power sector by mid-century. To fully harness this potential, IESR emphasised the importance of regional cooperation, innovative climate models, and the implementation of effective policies.
IESR urged Southeast Asian nations to adopt a regional energy planning framework with more ambitious renewable energy targets. These priorities should be reflected in ASEAN’s Post-2025 Vision, which underscores the importance of energy transition in addressing climate change. Failure to establish a clear roadmap for energy transition could result in the region becoming locked into carbon dependence, threatening to shrink projected economic growth by up to 35% by 2050, according to a study by NTU Singapore and the University of Glasgow.
Arief Rosadi, Climate and Energy Diplomacy Manager at IESR, underscored the potential of the ASEAN Power Grid (APG) to facilitate higher renewable energy use and enhance regional energy security. He also pointed to developing an electric vehicle (EV) ecosystem, as outlined in last year’s ASEAN+3 statement, which presents opportunities for international collaboration, benefiting both the environment and the economy.
Rosadi noted Southeast Asia’s wealth of critical mineral resources essential for renewable energy technologies, including 27% of the world’s nickel, 32% of its tin, 36% of its rare earth elements, and 22% of its bauxite reserves.
“The presence of this critical mineral resource in Southeast Asia could stimulate further investment in the solar panel and battery manufacturing sectors. It can also encourage the potential for broader energy transition energy cooperation in the region that can add value to the economy,” Rosadi said during the “Towards the ASEAN Summit” workshop on Wednesday, September 18.
Alvin P. Sisdwinugraha, IESR’s Renewable Energy Analyst, pointed out the sharp decline in solar module prices—down 66% in the last five years—boosting solar energy adoption in the region. He noted Southeast Asia’s solar module production is globally competitive, but industrial incentives are needed to support sector development, as seen in Malaysia and India.
“The electricity export cooperation agreement between Indonesia and Singapore, which requires the development of a solar energy supply chain in Indonesia, is an important step towards realising the ASEAN Power Grid. The potential for green job creation is also significant, particularly in the solar module manufacturing industry, which requires a highly skilled workforce. Cooperation between local education and research institutions and industry is needed to increase the workforce’s capacity and ensure technology transfer to local manufacturers.” Alvin added. (nsh)
