Southeast Asia is emerging as one of the regions with the greatest potential for growth in energy consumption in the coming years. According to a recent report by the International Energy Agency (IEA), the region, driven by rapid economic and population growth, is expected to account for around 25% of the expansion in global energy demand by 2035. This increase puts Southeast Asia second only to India in terms of energy needs, and even surpassing the demand of the European Union by mid-century.
To meet this growing energy need, the region is looking for sustainable alternatives, with clean sources such as wind, solar and modern bioenergy projected to meet more than a third of this increased demand by 2035. This progress, while positive, is still not enough to stabilize CO₂ emissions. It is estimated that without additional action, energy-related carbon emissions in Southeast Asia could grow by 35% by 2050. The region’s ambitious goal is to halve emissions by mid-century, in line with commitments made at COP28. Of the ten nations that make up ASEAN, eight have already announced net-zero emissions targets, committing to a transition to a more sustainable future.
Necessary Investments and Infrastructure to Support the Energy Transition
Despite its rapid growth, Southeast Asia still attracts only 2 percent of global clean energy investment, a relatively low figure for a region that accounts for 5 percent of global energy demand and is home to 9 percent of the global population. To align with its emissions reduction targets, the IEA report says the region needs a fivefold increase in clean energy investment, reaching about $190 billion by 2035. Infrastructure investment is also essential, with the need to double the capital allocated to power grids to nearly $30 billion annually. This includes modernizing and expanding power grids, with initiatives such as the ASEAN Power Grid, which aims to ensure regional energy integration, as well as developing renewable microgrids to serve isolated areas.
Furthermore, the IEA report highlights the economic benefits of the energy transition, with the creation of more than 85,000 jobs in the region since 2019. Countries such as Indonesia, Vietnam, Thailand and Malaysia are already positioning themselves as major producers of clean energy technology, and Singapore, with its important port, can play a strategic role in the decarbonization of global shipping.
International Cooperation and the Energy Future of Southeast Asia
Southeast Asia’s energy transition also depends on close international cooperation. The opening of the IEA’s first office outside Paris, in Singapore, reflects the commitment to supporting energy security and the deployment of clean energy technologies in the region. With a focus on strengthening regional networks and advancing domestic capabilities, Southeast Asia is at a crucial juncture to establish itself as a pillar of sustainability on the global energy stage, addressing climate and geopolitical challenges with innovation and strategic partnerships.
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