Powering Smart City Developments in ASEAN

Like the digitally savvy ASEAN consumer base, electric utilities in the region are embracing changes to the sector. Growing demand for electricity has necessitated the development of power generation and transmission infrastructure. Various efforts undertaken by major electric utilities in the region are highlighted to explore possibilities for collaborations across utility, telecommunications and digital solution players.

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In recent years, the Association of Southeast Asian Nations (ASEAN) have been experiencing accelerated economic growth in recent years, and is expected to be the fourth largest economy in the world by 2030. Going forward, the region is forecasted to exhibit robust economic growth at an annual average of 5.2% between 2018 to 2022.

As urbanisation and industrialisation in ASEAN increases, the region’s energy demand is also expected to grow by more than 67% by 2040, according to the International Energy Agency (IEA), where almost 80% is supplied by fossil fuels. Of which, electricity demand in ASEAN is forecasted to grow by 250%, In 2016, the IEA estimated that around $2.5 trillion of investment is needed to supply ASEAN’s forecasted energy demand between then and 2040. The power sector takes up approximately half of the amount, while the remaining is split between fuel supply and energy efficiency.

Going forward, the growth in energy demand expedites Southeast Asia’s transition from a net exporter of fossil fuels into a net importer of fossil fuels. In 2040, the region’s annual net import is estimated to be valued at over $300 billion, accounting to approximately 4% of the region’s GDP. ASEAN member states are facing increasing fiscal burden. Nonetheless, Indonesia persists to be an essential producer and exporter to countries within Southeast Asia and India.