Southeast Asia faces infrastructure, policy gaps in regional grid push, say industry leaders

Monday 21 Sep 2026

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KUALA LUMPUR (June 16): Southeast Asia lacks a unified regulatory and market framework for electricity trade — a key bottleneck impeding the development of a regional power grid despite strong political will for cooperation, said industry leaders at the Energy Asia 2025 conference on Monday.

Speaking at a panel session on regional interconnection, representatives from the Asean Centre for Energy (ACE), Indonesia’s Pertamina and UAE-based Masdar highlighted gaps in cross-border coordination, regulatory clarity and grid infrastructure as major challenges for scaling up renewable energy integration across the region.

"Asia is the only major region without significant geopolitical conflict. That gives us an edge to harmonise energy regulations," said Nadhilah Shani, manager of power generation and interconnection at ACE. "But today, every country is planning its own grid and generation without knowing what its neighbours are doing."

She pointed out that while countries like Indonesia, Thailand and Singapore have made strong bilateral commitments — including Indonesia’s recent cross-border links with Malaysia and Singapore — the absence of a coordinated regional energy planning platform limits scalability.

ACE currently tracks 18 priority interconnection projects under the Asean Power Grid initiative, but progress remains mixed.

Another challenge, panellists said, is the mismatch between the pace of renewable energy development and the ability of grid infrastructure to support it.

“Grid infrastructure is lagging behind,” said Fatima Al Suwaidi, head of business development for the Asia-Pacific at Masdar. “As a developer, my worst nightmare is to build a project but not be able to evacuate the power. We need to see stable, coordinated grid plans that keep pace with renewable ambitions.”

Masdar, which aims to install 100GW of renewable capacity globally by 2030, sees Southeast Asia as a priority growth region. However, Fatima noted that fragmented permitting processes and long development timelines in the region are deterrents for investors.

“The development timelines in Southeast Asia are long. Permits can take years, and approvals get delayed due to fragmented processes. That’s a major deterrent for developers,” Fatima said, adding that digitalisation and streamlining of regulatory processes would help de-risk investment.

Panellists agreed that regulatory reforms — particularly around who pays for transmission — are critical if private capital is to be mobilised for large-scale grid infrastructure.

“Renewable Energy Credits and incentives work well for generation, but we haven’t reached that level yet for transmission,” said Nadhilah. “We need regulatory frameworks that can attract private investment to build the infrastructure.”

Fatima echoed the need for clear, long-term offtake arrangements, stable policy and transparent permitting as critical de-risking tools. “We need to see regulators open up transmission and distribution investment to the private sector. That will be a game-changer.”

Edited ByS Kanagaraju

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