One-year slippage in the commissioning of the ASEAN Power Grid will cost the region $2.6 billion, increasing to $14 billion for a five-year delay

The report finds the binding constraint is governance. The International Energy Agency puts the cost of APG interconnections at around $27 billion by 2040, rising to $100 billion by 2045 once domestic grid upgrades are included, according to the Asian Development Bank — a sum the report says is manageable if capital is effectively mobilised from multilateral banks and private investors. However, multiple ASEAN bodies coordinate planning, but none can enforce decisions. National rules add to the problem. Indonesia does not permit third-party access to transmission infrastructure and requires renewals of renewable electricity export permits every five years, while investors need 20 to 25 years of certainty to finance large-scale renewable energy and interconnection projects.

Ember recommends three shifts happening together to ensure the APG is built by 2035. Political commitment must hold beyond electoral cycles, backed by the active working-level coordination like those that delivered the Lao PDR–Thailand–Malaysia–Singapore Power Integration Project. Wheeling charges, transmission tariffs and cost allocation need harmonising on a beneficiary-pays basis so projects become bankable. Bilateral deals remain the pragmatic starting point, but their governance should be designed from the outset to scale into multilateral power trade, which can lift interconnector utilisation from around 60% to as high as 90%.