Asean faces widening electricity security challenges amid rising demand: IEA report

The International Energy Agency (IEA) has released a report highlighting the growing electricity security challenges facing Southeast Asia due to increasing demand. The report predicts that electricity demand in the region will expand at an average annual rate of 5.4% through 2030, driven by rising cooling, data centre and industrial needs.

Indonesia is projected to contribute the largest share of this growth, followed by Vietnam. However, the supply of electricity remains vulnerable to fuel market and geopolitical developments, as reliance on imported liquefied natural gas (LNG) and coal could lead to rising power generation costs and electricity prices. Natural gas use in the region is expected to surge by 18% between 2025 and 2030, primarily driven by the power sector, with around 24 gigawatts of gas-fired generation capacity being added.

While low-emissions hydrogen and biomethane production are unlikely to grow significantly, Southeast Asia's expanding supply of critical minerals like nickel, cobalt, and copper positions the region as an important source of additional supply for clean energy technologies. The report emphasizes the importance of diversifying and strengthening regional supply chains, as the region currently holds a significant portion of global reserves in these critical minerals.