ASEAN’s Decarbonization Could Save $800 Billion Through Regional Collaboration – Study

A groundbreaking study by DNV forecasts that embracing decarbonization across the Association of South East Asian Nations (ASEAN) could result in an astounding reduction of $800 billion in costs. The key lies in comprehensive regional collaboration, including power interconnectors, hydrogen networks, and energy storage infrastructure.

The study, titled “ASEAN Interconnector Study: Taking a Regional Approach to Decarbonization,” released by DNV, meticulously assesses the benefits of a unified regional strategy towards decarbonizing the power sector. It addresses challenges while highlighting the advantages of efficient resource utilization and sharing.

While the aspiration to achieve net-zero carbon emissions by 2050 is shared among ASEAN member states, most efforts have remained confined to individual nations. The study models three scenarios for decarbonizing the ASEAN power sector by 2050: an individual approach, moderate interconnection, and regional cooperation.

The primary advantage of regional cooperation lies in minimizing the necessary levels of renewable generation and energy storage to attain net zero. This approach, involving full, unconstrained resource-sharing between countries, could lead to significant cost savings and optimized material resource utilization.

Mats de Ronde, Team Lead, Energy Markets & Strategy APAC, Energy Systems at DNV, emphasized the importance of collaboration, stating, “Decarbonization is a global challenge, and ASEAN countries should not address this individually. With increased cooperation and resource sharing, we can increase the speed of the energy transition while reducing the cost to consumers and the environment.”

Brice Le Gallo, Vice President and Regional Director APAC, Energy Systems at DNV, added, “At DNV, we aim to support the energy sector with insights to realize a clean, affordable, and reliable energy transition. Our study forecasts power flow between ASEAN countries and regions under different scenarios, with Moderate Interconnection offering substantial cost savings and requiring limited interconnectors, making it a moderate step towards decarbonization as key stakeholders recognize the benefits of cross-border interconnectors.”