Southeast Asia is entering a decisive stage in its energy transition. As energy demand grows, governments are looking for ways to deliver affordable, reliable and clean electricity to homes, businesses and industries. One long-standing initiative offers a practical path forward: the ASEAN Power Grid (APG).

Energy connectivity is an important part of decarbonizing the region’s power systems. The International Energy Agency estimates that countries around the world need to double investments in power grids to meet climate targets. The APG aims to link all ASEAN Member States into a single, integrated system by 2045. By facilitating cross-border electricity trade, this will strengthen energy security and reliability, maximize renewable energy potential and, and create a larger and more stable market for power in the region.

The idea of a regional power grid first emerged in the mid-1980s. Since then, ASEAN has taken a phased approach, beginning with bilateral and sub-regional connections. These links provide the foundation for more advanced, multilateral electricity trade in the future.

A key example is the Lao PDR–Thailand–Malaysia–Singapore Power Integration Project (LTMS-PIP), which sends hydropower from Lao PDR to its neighbors. In 2023, ASEAN announced another initiative, the Brunei–Indonesia–Malaysia–Philippines Power Integration Project (BIMP-PIP), linking the eastern sub-region. Singapore has also signed agreements to import 7.3 gigawatts of clean energy from neighbouring countries in the region.

These initiatives show that the benefits of power trade are well recognized. Countries with limited renewable resources can buy clean electricity, while those with an abundance can earn from exports. Regional connectivity also makes it easier to balance variable sources like wind and solar across wider areas.

Recent studies suggest that linking power systems could cut the cost of Southeast Asia’s decarbonization by US$800 billion. Shared infrastructure means countries would need to invest less in local generation and storage capacity, which is valuable in a region where financing remains a challenge. 

Beyond the financial case, there is a broader story to tell. “To encourage stakeholders to look beyond the techno-economic advantages of the APG, it's essential to highlight the long-term sustainability and just transition benefits that a more integrated grid can offer,” shares Matthew David Wittenstein, Chief of the Energy Connectivity Section at the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP). 

Matthew further points to the importance of showing how the APG can help deliver Sustainable Development Goal 7 in the region as well as address the energy trilemma: affordability, reliability and sustainability, especially for underserved communities in the region.  

This broader view is being built into regional planning. ESCAP’s Green Power Corridor Framework offers principles and metrics to align projects with the Sustainable Development Goals. A new “Green Power Corridor Playbook” is also being developed to provide a practical guide for putting energy connectivity into action in ways that promote inclusive growth, social equity and climate resilience. It will include tools for assessing economic, environmental and social impacts, along with recommendations for policies and best practices.

Progress toward cross-border power integration is not without challenges. Many countries still focus on national energy priorities. Some place the greatest importance on security of supply, while others focus on affordability or sustainability. Ensuring that the benefits are fairly shared is essential, particularly for smaller economies. Regional cooperation could help with investment access and technology transfer so that all countries can participate fully.

The ASEAN Plan of Action for Energy Cooperation (APAEC) guides regional efforts. Its next phase, starting in 2025, will place stronger emphasis on energy connectivity. Combined with ESCAP’s Regional Roadmap for Power System Connectivity and the ASEAN Centre for Energy’s (ACE) Roadmap for Multilateral Power Trade, these present an opportunity to outline crucial steps forward and better align national plans with regional and global goals.  

Building the skills and knowledge to support integration is another priority. ESCAP is partnering with ACE, Clean, Affordable and Secure Energy for Southeast Asia (CASE) and the Southeast Asia Energy Transition Partnership (ETP-UNOPS) under the ASEAN Power Grid Advancement Program, which will aim to roll out sub-regional pilot projects for multilateral power trade in 2026 and beyond. 

ESCAP is also working closely with the ASEAN Energy Regulators’ Network (AERN), the ASEAN Secretariat, and ETP-UNOPS to establish the ASEAN School of Regulation. The school will offer structured training, peer learning and research to support power system integration and regulatory harmonization. Its first summer programme in September 2025 involved both policymakers and young professionals, with a focus on increasing the participation of women in the energy sector.

The long-term value of the APG lies in its ability to deliver a range of benefits beyond the energy sector. New transmission corridors can bring development opportunities especially for rural areas, improve access to markets, education and health care, and support local economic growth. Adding 30 gigawatts of solar and wind capacity could create around 182,000 jobs in manufacturing, installation and maintenance. Cleaner power would help reduce air pollution, with studies suggesting power connectivity could prevent up to 15,000 pollution-induced deaths every year .

“By framing the APG as a regional development tool, rather than just a technical infrastructure project, we can expand its appeal to a broader group of stakeholders,” adds Wittenstein. He notes that this approach makes it easier to link energy connectivity with inclusion and sustainability, which in turn can increase both public support and investor interest.

The ASEAN Power Grid represents more than an techno-economic solution to pressing power market challenges. It is a platform for regional cooperation, inclusive growth and a just energy transition. As ASEAN prepares to adopt the next APAEC and renew the Memorandum of Understanding on the APG, decision-makers have a chance to shape a new narrative and turn energy connectivity into a powerful tool for transformation.

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The article was prepared with substantive input contributed by Yejin Ha and Kieran Clarke of Energy Division.