Asean to Strengthen Regional Power Grid Integration in October 2023
Asean is set to fortify its regional power grid integration with an enhanced memorandum of understanding (MoU) in October 2023. The agreement will focus on harmonizing rules and regulations for electricity trade among its members, with a particular emphasis on creating a transparent tariff framework and dispute resolution mechanisms.
The upcoming MoU is timely, given that eight out of ten Asean countries have committed to achieving net-zero targets, with deadlines ranging from 2050 to 2065. To facilitate this transition, Asean will prioritize the development of common technical standards and grid codes to ensure seamless interoperability.
Malaysia, this year's host of the annual meeting of Asean energy ministers, is taking a proactive approach. It has requested support from the Asian Development Bank (ADB), the International Energy Agency (IEA), and the International Renewable Energy Agency (IRENA) for the development of the Asean Power Grid (APG). The country aims to address regional power grid integration challenges practically and sustain momentum on the APG through regular ministry-level monitoring and dedicated financing mechanisms.
The enhanced MoU on the Asean Power Grid, slated for October 2023, is expected to attract investment in the energy sector by creating a stable regulatory environment and offering de-risking instruments. With two-thirds of respondents in a recent survey calling for stronger cross-border coordination frameworks for clean energy scaling, the MoU is a significant step towards building investor confidence through more streamlined standards and a transparent tariff framework.
