Supporting ASEAN’s push for regional power integration

By 2050, Southeast Asia could need three times the electricity it uses today. As Southeast Asia’s electricity demand surges, regional cooperation is critical to building a secure, resilient and low-carbon energy future. The ASEAN Power Grid (APG) offers an answer. This flagship initiative aims to connect electricity systems across all ten ASEAN member states. 

Through P4I, the Australian Energy Regulator (AER), has been working alongside ASEAN energy regulators to share experiences and explore solutions to shared challenges. At ASEAN's invitation, the AER contributed to recent activities supporting the APG vision, including:

• 16^th ASEAN Energy Regulators Network (AERN) Meeting (June 2025) – Explored practical approaches to electricity market reform and interconnector planning.
• Pilot Summer School for Energy Regulators (October 2025) – Supported capacity building for energy regulation good practices.
• Singapore International Energy Week (October-November 2025) – Engaged with regional peers on evolving regulatory frameworks. 

Why the APG matters 

First proposed in 1997 under the ASEAN Plan of Action for Energy Cooperation, the ASEAN Power Grid (APG) is a flagship initiative to strengthen regional energy security, integrate renewable resources, and enhance economic connectivity. By enabling cross-border electricity trade, the APG creates opportunities to share seasonal surplus energy—such as hydropower from Lao PDR and Malaysia—with economies including Vietnam, Thailand, Indonesia, and Singapore. This cooperation can lower system costs, improve resilience, and accelerate the transition to clean energy across Southeast Asia. 

Challenges and progress 

Progress has been slow. Cross-border electricity trade remains limited and mostly bilateral, constrained by political, technical and financial hurdles. Half of the 18 priority interconnection projects have been completed. 

2025 marks a turning point. At the 43rd ASEAN Ministers on Energy Meeting in October, the bloc formally endorsed the Enhanced APG MOU and launched the APG Financing Initiative - a regional initiative aiming to create an integrated transmission network for an accelerated development of renewable energy across Southeast Asia. A new terms of reference for the ASEAN Submarine Power Cable Development Framework was also endorsed to provide clearer governance for regional grid development. 

Sharing Australia’s experience

Peer-to-peer exchange between regulators is a powerful tool for problem-solving and addressing common challenges. Australia’s electricity market reform journey offers valuable lessons for enabling regional integration. The National Electricity Market (NEM) has evolved through decades of policy, planning, and regulatory changes shaped by regional contexts and consumer interests. 

At the recent AERN meeting, AER shared insights on:  

• The evolution of Australia’s NEM, its governance, and the role of the national regulator;
• How interconnection projects are planned, regulated and financed to support system-wide coordination. 

Feedback from ASEAN member states was overwhelmingly positive, with regulators expressing strong interest in deeper collaboration and continued knowledge sharing. P4I has prepared two insight briefs capturing key takeaways from Australia’s experience: 

Insight brief 1: Forming the National Electricity Market: Australia’s electricity market reforms

Insight brief 2: Making interconnectors work: Australia’s experience in regulation and planning

These resources aim to contribute to ASEAN-led efforts to strengthen regional energy systems and deliver the APG. P4I remains committed to supporting ASEAN-led priorities through capacity building, and sharing experiences—both successes and setbacks—from Australia's own journey.