Zero in on the ASEAN power grid, analysts say.
According to the latest report by the International Energy Agency, given the challenging geography, funding cross-border connections can be a major hurdle. Power system investment needs are significant compared to the existing ASEAN asset stock and to global investment needs.
IEA projections show that the total power sector investments required – excluding interconnections – may reach USD 1.3 trillion by 2040. The current APG plan is estimated to cost USD 20 billion.
Here's more from IEA:
It is evident that public spending is limited and will not suffice for the timely development of the envisaged electricity infrastructure.
The completion of some interconnections is more realistic than that of others because of existing business scenarios. These projects enjoy funding from multilateral development banks, bilateral agencies and the private sector.
However, other APG projects lack economic viability although they have regional benefits and can be seen as a regional public good. ASEAN needs to invest more directly in the APG, provide public guarantees to attract more private and foreign direct investment and avoid funding strategic regional interconnections solely
from its own budgetary resources.
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