Support to the Development of the 4th ASEAN Energy Outlook (Asean Energy Outlook 2015)

The Association of Southeast Asian Nations (ASEAN) was established in 1967 with the aim to enhance and strengthen economic cooperation, social progress and cultural development, thereby creating a basis towards facing future challenges as a prosperous and peaceful community.

Fraunhofer-ISI assisted the ASEAN Centre for Energy in the task of developing the 4th ASEAN Energy Outlook, as a continuation of three previous outlooks published in 2006, 2009 and 2011. This outlook presents two scenarios of energy demand and supply for the region into 2035: A Business as Usual (BAU) Scenario, which reflects the continuous trend of the developments from the past, and an Advancing Policy Scenario (APS), incorporating progressive policy and action plans from each ASEAN Member State to achieve their official national target for renewable energy and energy efficiency.

The 4th ASEAN Energy Outlook not only aims to provide policy makers with an understanding of the energy trends and challenges being faced by the region up to the year 2035, but also to strongly involve all ASEAN Member States in the process. The outlook complements the implementation of the ASEAN Plan of Action for Energy Cooperation (APAEC) 2016-2025, thereby deriving strategies within ASEAN to address future energy needs. The APAEC 2016-2025 targets aspire to achieve 23% renewable energy in energy mix by 2035, as well as a reduction of energy intensity of 20% by 2020 as compared to 2005 levels. The exact definition of the target is to be found in the APAEC 2016-2025 official document, available under the link below.

To estimate future demand, econometric projections of energy demand were combined bottom-up energy system models for each ASEAN Member State. The Outlook uses national GDP growth aspirations as well as national population growth forecasts within the period 2013-2035. Each ASEAN Member State’s results were then aggregated to obtain the regional outlook, and further validated by an independent regional forecast model. The outlook´s final results are therefore in-line with the Member States’ expectations on their future energy landscape.

BAU: ASEAN is expected to require more than 2.7 times its energy demand in 2013 to meet the corresponding economic growth targets. Yet, during the same time frame, GDP is forecasted to increase by a factor of 3.7, implying a future energy intensity reduction. ASEAN´s Total Primary Energy Supply (TPES) is expected to amount to 1,685 Mtoe of in 2035, up from 619 Mtoe in 2013.

APS: In the Advancing Policy Scenario, ASEAN is expected to require more than 2.3 times of its current annual energy requirements in order to maintain economic growth as targeted. Yet, the implementation of policies targeting higher efficiency standards in the transformation sector, demand-side management and deployments of renewable energy will in turn lead to substantially lower primary energy requirements: The TPES will grow at a slower yearly average rate of 4.0%, accounting for 1,468 Mtoe in 2035. This corresponds to primary energy savings of about 13% as compared to BAU.

Further, the 4th ASEAN Energy Outlook underlines the potential for the use of renewable energy by the ASEAN Member States as an important element in a diversified energy mix as well as contributor to the labor market and local manufacturing – as a catalyst for economic development. This potential has, to a large extent, not been tapped so far.