Asia's energy future needs to be spoken about around the world

On face value, there may not appear to be much that Midtown Manhattan and the Laos capital of Vientiane hold in common.

But in late September the two cities shared the same critical topic of conversation: the future of energy in Asia and the ability of nations in our region to transform their energy system over the next few decades.

At the North American Climate Summit in New York, ANGEA had the privilege of hosting a side-event in partnership with the US Chamber of Commerce. With representation from ANGEA member companies JERA, Mitsubishi Heavy Industries and bp, along with our colleagues at LNG Allies, the panel session focused on the unique role of natural gas in emissions reduction pathways for Asia Pacific.

Set against the backdrop of Climate Week and coming off Gastech 2024, it was a highly engaged session with some very relevant audience questions to follow. What resonated very strongly through the conversation was the enormous potential for natural gas to underpin credible energy transition in emerging Asia and support the region’s shift to a lower carbon future.

Meanwhile in Vientiane, our partners at the ASEAN Centre for Energy (ACE) were presenting their 8th ASEAN Energy Outlook.

It’s an exceptional and highly-researched document, which I’d recommend anyone with an interest in the energy affairs of Southeast Asia takes some time to download and read.

A high-level statistic that stood out to me was the fact that energy demand in Southeast Asia is projected to grow 260% to 2050. This energy is required to support strong economic growth in emerging and highly populous nations like Vietnam, the Philippines, Thailand and Indonesia and it will help raise living standards for hundreds of millions of people.

Much like our panel dialogue in New York, the Energy Outlook very clearly identifies natural gas as a fuel that will be vital to Southeast Asian nations balancing sustained economic growth with progress on climate targets.

As the report states:

“Natural gas retains a stable and crucial role across all scenarios, acting as a transition fuel due to its flexibility and relatively lower emissions compared to coal.”

The reality is that emerging nations in Asia must find a way to meet rising energy demand. Curtailing energy use and preventing economic advancement is not a scenario that anyone should be willing to countenance.

As it stands, energy options for these countries are quite limited.

Most nations in Southeast Asia are making significant investments in renewable energy but challenges with intermittency, storage, cost and grid integration means the share of renewables in the region’s total primary energy supply is still less than 15 per cent.

Coal, which is inexpensive, plentiful and familiar, remains the dominant form of energy for Southeast Asia – the main source of electricity generation for Indonesia, Vietnam, the Philippines and Malaysia.

Natural gas offers a much-lower carbon alternative to coal and an ideal partner for renewable energy, one that features prominently in the long-term energy plans of many Southeast Asian nations. They view gas as a fuel that will enable them to reduce emissions even as their economies continue to grow.

But supply has to be both assured and affordable for countries to make the types of multi-decade infrastructure investments that significant expansion of gas-fired power capabilities will require.

Despite some recent promising recent exploration results, Southeast Asia (and Asia more broadly) does not have the gas resources to be self-sufficient. Our region’s ability to affordably access gas to displace coal over coming decades will be heavily dependent on there being sufficient supply of LNG from the US, Australia, the Middle East and other developing markets.

It’s essential that Asia’s energy circumstances and the unique energy transition pathways of its nations are properly understood by policy makers in these gas-producing jurisdictions.

This is why pragmatic conversations about Asia’s energy future are not only important in Laos and places closer to home but in New York (Climate Week), Houston (Gastech) and major cities around the world.

Paul Everingham is the inaugural CEO of the Asia Natural Gas and Energy Association (ANGEA), which works with governments, society and industry throughout Asia to build effective and integrated energy policies that meet each country’s climate objectives.?