ASEAN energy needs $180b investment

ASEAN energy needs $180b investment

SINGAPORE (Agencies): Southeast Asia needs nearly US$180 billion in investments over the next 10 years to fully develop its energy sector, a conference was told Thursday.

Investment opportunities lay in power generation, renewable energy and the development of a natural gas pipeline to traverse the 10 countries comprising the Association of Southeast Asian Nations (ASEAN), an expert told the gathering.

Guillermo Balce, executive director of the ASEAN Centre for Energy, said the region's energy needs will grow by 58.8 percent to 581.37 million metric tons of oil equivalent (MTOE) in 2010 from 366.01 MTOE this year.

Indonesia's requirements alone will grow by 89.6 percent, he said.

Despite efforts to lessen dependence, oil will continue to play a dominant role in the energy mix for the region, accounting for 56-57 percent of the total, Balce said.

Oil demand is projected to increase by 62.4 percent from this year to 334.02 MTOE by 2010.

Demand for natural gas, a cheaper and cleaner alternative for the oil-importing region, is to rise at a slower rate of 29.74 percent.

"The total amount of investment that may be required for the next 10 years in Southeast Asia is about $180 billion," he told the conference on opportunities in the sector in ASEAN organised by Singapore Power.

"This is enough business for each one of us in this room, granting that each of us could raise half a billion U.S dollars to invest in the various aspects of the energy industry in Southeast Asia."

Power generation alone would require investments of $87.5 billion by 2010 with installed power capacity for the region seen to grow nearly 50 percent to 142,273.2 megawatts, Balce said.

Thailand will require $21 billion, Vietnam $18.5 billion and Indonesia about $18 billion in power generation, he said.

The trans-ASEAN gas pipeline would need at least $10 billion to become a reality.

Investments in renewable energy such as biomass, hydro, solar and wind power are estimated at $3.6 billion, Balce said.

An additional $77.65 billion in investments are needed to put in place energy efficiency measures.

This is significant because of forecasts that coal will account for 42 percent of power generation needs in 2010, Balce said.

ASEAN groups 10 diverse countries in Southeast Asia, from affluent Singapore to economic backwaters Cambodia, Laos, Myanmar and Vietnam. The other ASEAN members are Brunei, Indonesia, Malaysia, the Philippines and Thailand.

Singapore Minister for Trade and Industry George Yeo told the same conference that " his country is prepared to invest in commercially viable electricity interconnection projects under the Asean power grid.

Singapore is considering such investment in "general terms," with no specific projects currently in the pipeline, Yeo said on the sidelines of the Third Asean Energy Business Forum. Investments would depend, in part, on the regulatory conditions of each county, he said.

Citing recent Indonesian-Singaporean gas cooperation projects, Yeo said in a speech to delegates that Singapore "will do its part to bring about great economic cooperation in the energy industry."

An Association of Southeast Asian Nations power grid will help optimize energy resources, make power generation more cost effective, spur the liberalization of national electricity markets and attract more private sector investment, he said.

Yeo called for the private sector to take a more active role in building and financing infrastructure.