In September 2025, the International Energy Agency (IEA) reported that Southeast Asia has a vast yet untapped potential of renewable energy.
Despite the challenges presented, this potential can be deployed without major system overhauls and can fulfill the region’s increasing electricity demand.
How Big Is The Potential?
Thanks to the strategic geographical position, Southeast Asia is able to develop variable renewable energy (VRE) sources of solar and wind.
IEA stated that the technical potential from these two sources is around 20 terawatts, more than 50 times the region’s current power capacity. The number exceeded the 17 terawatts estimation previously reported by the International Renewable Energy Agency (IRENA) in 2022.
A fraction of this potential is already enough to meet demand, lower fuel imports, and help countries achieve their clean energy objectives.
However, deeper integration of VRE introduces several challenges. In a separate occasion, Fabby Tumiwa, the CEO of the Institute for Essential Services Reform (IESR), said that weak policy framework, incoherent regulations, and large fuel-based infrastructure have hampered the region’s transition to renewable energy.
The good news is that according to IEA, these problems are manageable without requiring total system changes.
Proposed solutions by the IEA include upgrading existing power plants, modernising grid infrastructure, and improving forecasting. Innovative measures like electric vehicles can also boost the integration process.
Are Southeast Asia Ready For The Energy Shift?
IEA’s report said that in 2024, nine Southeast Asia countries generated less than 5% electricity from renewable energy. Viet Nam, however, is leading as the only country operating at phase three of the VRE Integration framework. It means solar and wind energy begin to have an impactful contribution to the country’s power system.
Other Southeast Asia neighbours are currently operating at first or second phase of integration, where renewables have no to little impact on the national power system. Most of these countries are predicted to catch up with Viet Nam by 2035.
Read Also: 10 Asian Countries with the Largest Renewable Energy Capacity, 2024
The report also provided IEA’s recommendation on ASEAN countries’ varying levels of readiness, which is split into early-stage, mid-stage, and high-readiness.
Countries at early-stage, including Brunei, Cambodia, Laos, and Myanmar, should focus on regulations, grid codes, and government-utility planning.
At mid-stage are Indonesia, Malaysia, Thailand, and Viet Nam. These four countries should execute more advanced tasks such as investments in a wider range of flexibility resources.
Only the Philippines and Singapore are believed to be at high-readiness level. IEA recommends them to prepare roadmaps on flexibility deployment, reform on market and regulation, grid services advancement, and cross-sector planning.
Why Does Southeast Asia Need More Renewable Energy Sources?
Sum-Ern Tan, Head of the IEA Regional Cooperation Centre, wrote in the report that VRE integration is both urgent and essential.
In 2024, the region’s electricity demand growth soared by more than 7%, almost twice the global average, and is projected to double by 2050. Rapid urbanization, industrial growth, and rising living standards are the contributing factors to this high number.
In addition, many members of ASEAN today still depend heavily on fossil fuels. Not only this halts their decarbonization process, it further exposes the risk of fuel price volatility and supply disruptions.
For example, Viet Nam faced a coal shortage in 2022. During the same year, the Philippines experienced an electricity supply deficit due to falling domestic gas production and difficulty in sourcing additional coal.
Optimizing solar and wind resources will allow Southeast Asia to overcome the high energy consumption rate while limiting greenhouse gas emissions and maintaining energy security.
What ASEAN Has Done So Far?
Southeast Asian countries have prepared regional initiatives for renewable energy deployment, such as the ASEAN Vision 2045 and the impending renewal of the ASEAN Plan of Action for Energy Cooperation (APAEC).
In accordance with the initiatives, policy instruments such as agreements on direct power purchase are spreading across Southeast Asia, aiming to accelerate the green energy transition.
Eight of ten ASEAN nations have set net-zero emissions targets. At the UN General Assembly on September 23, Indonesian President Prabowo Subianto expressed confidence that the country can accomplish the target ahead of schedule before 2060.
Recognising Southeast Asia’s influence on global energy trends, the IEA has established the first office outside their Paris headquarters in Singapore. With long-standing relationships as a foundation, this office is set to support the region in addressing the energy challenges.
IEA is scheduled to present the report at the ASEAN Energy Business Forum on October 15 in Kuala Lumpur, Malaysia.
Sources:
International Energy Agency. (2025). Integrating Solar and Wind in Southeast Asia: Status and outlook for secure and efficient strategies. https://www.iea.org/reports/integrating-solar-and-wind-in-southeast-asia
International Renewable Energy Agency. (2022). Renewable Energy Outlook for ASEAN: Towards a Regional Energy Transition (2nd Edition). https://www.Irena.org/Publications/2022/Sep/Renewable-Energy-Outlook-for-ASEAN-2nd-edition
https://iesr.or.id/en/southeast-asia-needs-to-become-a-renewable-energy-manufacturing-hub/
