Thorough connectivity of Asean’s electrical grid has been a long-held aim since the 1980s when it initially became a significant topic of discussion. Now, some four decades later, we may finally be approaching a point when the urgency for climate action pushes this concept closer to becoming a reality.
Southeast Asia’s push toward renewable energy
As per the Asean Energy Outlook, energy consumption in Southeast Asia is expected to quadruple from 2022 to 2050. It will be difficult to meet this increased demand while managing the energy paradox of secure, affordable, and sustainable energy.
Renewable energy sources are becoming increasingly important as part of the answer, with most Asean nations aiming for roughly 30% renewable energy in their power mix by 2030. To fulfill these goals, Asean has a wide range of renewable energy capacities, including large geothermal capacity in Indonesia and the Philippines, wind and solar capacity in Vietnam, hydropower capacity in Malaysia and Laos, and major solar energy capacity throughout the region, particularly in Thailand and Malaysia.
Integrating renewable technologies, on the other hand, has its own set of difficulties. To transport clean power from the point of supply to the point of demand requires both technological and grid enhancements. Intermittent generating will necessitate careful investment in order to match peak generation times with peak consumption.
Finally, the potential of renewable energy will be determined by local terrain and weather. Countries like Singapore, which are land-locked or lack favorable conditions for renewables, may have difficulty fulfilling their decarbonization ambitions.
Interconnections: Overcoming Challenges
Interconnections, which are high-voltage cables that link electrical networks from multiple nations, can help mitigate the issues of renewables integration. Interconnections allow energy to be transferred from areas with plentiful energy generation to areas where there is a shortage. This would allow the area to combine multiple renewable energy sources with complementing supply profiles, easing the decarbonization of Asean power grids.
Electricity trading allows for greater stability and load balance. It can also assist countries to optimize power infrastructure investment in the region by allowing them to invest in assets with high renewable potential while depending on the Asean Grid to deliver other renewables when needed. This would improve market efficiency, lower costs, and increase accessibility. Interconnection also improves the economy by lowering average investment costs as well as reserve ratios, as well as allowing for future growth in some resource-rich but underdeveloped economies.
In the face of severe global challenges, a linked electricity system also increases resilience. Having a consistent regional supply of renewables can assist minimize dependency on fossil fuels and alleviate fuel volume and price uncertainty caused by events like the Ukraine conflict and the current volatility in Southeast Asian coal prices caused by variable demand in China.