Southeast Asia's Clean Energy Transition: Solar Leads, Grid Upgrades Urged
A new survey reveals a shifting landscape in Southeast Asia's clean energy transition, with investors and respondents highlighting both progress and challenges. While solar remains the top renewable energy choice, grid upgrades and energy storage are now priorities. Meanwhile, Singapore's regional leadership has slipped, and respondents urge stronger cross-border coordination to protect against disruptions.
Investors are focusing on grid upgrades (41.9%) and energy storage (65.7%) to accommodate intermittent power sources, indicating a shift in priorities. Two-thirds of respondents call for stronger cross-border coordination to safeguard against energy supply chain disruptions. Despite these concerns, solar is still seen as the most scalable renewable energy in the next five years (83.8%), followed by green hydrogen (57.1%).
Malaysia (14.3%) and Vietnam (13.3%) are now viewed as the second and third most progressive countries for the energy transition, challenging Singapore's dominance. While Singapore is still expected to lead on carbon pricing and solar integration, it has slipped in respondents' rankings (51.4% in 2025, down from 95% in 2024). The region faces grid bottlenecks, weak regulations, and investment uncertainties, with outdated infrastructure (73%), regulatory uncertainty (67%), and financing constraints (56%) identified as major barriers.
Respondents warn of geopolitical, financial, and systemic risks, with regional conflict and political tensions (52.4%), energy protectionism (45.7%), and supply chain disruptions (41.9%) cited as top threats to the energy transition.
The Southeast Asian energy transition is entering a complex phase, requiring robust cross-border coordination and investment in grid infrastructure. While solar remains the preferred renewable energy source, addressing grid bottlenecks and regulatory uncertainties will be crucial for progress. Despite challenges, the region's commitment to clean energy is evident, with Malaysia and Vietnam emerging as progressive players.
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