ADB cites need for $16 billion to establish ASEAN Power Grid 

In the quest to materialize the great regional grid interlink across the Association of Southeast Asian Nations (ASEAN), the Manila-based Asian Development Bank (ADB) is projecting around $16 billion worth of investments to pursue the development of key interconnections, according to a report by Manila Bulletin.

During a media briefing on Tuesday, June 3, Keiju Mitsuhashi, energy director at the ADB, explained that various studies provide budget estimates, including findings from the ASEAN Center for Energy (ACE), which reviewed the ASEAN Power Grid master plan, and the Department of Energy (DOE), which assessed feasible investments for the Philippine grid.

“We’re looking at, for now, [there are] 18 interconnectors in ASEAN. The estimates have been produced to be up to about $16 billion for this,” he told reporters alongside other ADB officials—director general Winfried Wicklein and Pavit Ramachandran, the ADB’s Philippines country director.

“There are more interconnectors [that came up] as options. If you include all of these, it could be more than $16 billion. That’s a lower side of our estimates,” Mitsuhashi added.

The ASEAN Power Grid’s goal is to connect the electricity grids of all member countries—Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand, and Vietnam. Previously, ACE also noted that there have been plans to look into the interconnection between Brunei, Indonesia, Malaysia, and the Philippines (BIMP).

This project would help facilitate energy sharing between countries with surplus power and those with higher demand, ultimately minimizing reliance on a single power source.

However, this project shouldn’t stand alone as the answer to these nations’ power woes, as Mitsuhashi said, “The interconnection itself doesn't solve the problem. So, the grid needs to be connected with the cross-border connection, yes, but also domestic connections are the key. Because there will be a power generation site somewhere that has to go through the domestic grid and the interconnection.”

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“Roughly speaking, we estimate at least there will be a need for $100 million just for the transmission investments in the ASEAN region. So you can see the magnitude of this compared with the interconnectors. Why? Renewable energy (RE) investment has to be done within the country or in offshore, but that needs to be connected,” he added.

At the same time, he cited the need for enhancements within the grid capacity, as well as storage, to ensure the stability and reliability of the grid.

Previously, the ADB reported that limited interconnectivity of power systems has led to supply losses and technical issues, resulting in insufficient grid preparedness.

In 2024, the ADB reported it had committed around $3.8 billion (or approximately %u20B1211 billion) in energy financing. Seventy percent of this would contribute to climate mitigation and adaptation, including RE and other infrastructure projects.