Opportunities for Australia in ASEAN's energy sector

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This article was written by Scott Gardiner, Louis Chiam and Michael Lawson.

More than 90 million people are expected to move to cities across ASEAN by 2030, resulting in enormous demands on the energy sector, but also creating opportunities for market participants, including opportunities for collaboration between ASEAN and Australia.  

While ASEAN nations' regulatory models have become more sophisticated and transparent, there are undoubtedly opportunities for Australia to work with them in taking their regulatory environments (particularly at a land tenure, regulatory approvals, and project identification, evaluation, structuring and tender process levels) to the next stage.  

Australia has very robust and transparent systems in place for all of these elements, developed over many decades, and it could share with ASEAN the best of these systems (perhaps leaving behind the 'red tape' that burdens some of them) to assist ASEAN nations in developing and implementing the energy solutions of the 21st and 22nd centuries.

Opportunities for Australia

ASEAN's strong, rapidly developing utility scale solar and wind markets

Australia can add value by exporting its learnings associated with the Reliability Obligation in the National Electricity Guarantee to ASEAN.  

The sophisticated technologies which enable and will enable AEMO and others to monitor voltage, inertia, etc and real time local weather at intermittent generation sites, coupled with developments such as the revised Generator Performance Standards currently being developed, are things which Australia, with its high levels of intermittent generation penetration, should also be able to export to ASEAN.

Demand response is also a critical part of this solution.  As Australia develops the technologies to roll out both utility scale and residential scale demand response solutions, it should seek to export these to ASEAN.

Microgrid technologies

Companies like Ergon and Horizon are already developing sophisticated microgrid technologies.  These technologies and solutions are ideally suited to the archipelago nations like Indonesia and the Philippines.

And while rolling out 200 microgrids on islands across an archipelago nation might appear more difficult to implement and manage than say building a more traditional distribution network and 2 large coal fired power stations, the cost and time savings would be significant. 

Australia can and should assist with the learnings, including at a regulatory level, necessary to enable ASEAN to roll out significantly cheaper distributed energy microgrid solutions.

Increased, strategic, engagement by leading Australian industry and government bodies

The above examples are just a small subset of the expertise which Australian agencies, companies and individuals can bring to bear in collaboration with their ASEAN counterparts.  But how can we do this better? 

  1. At the most basic level, there is still a real need for many Australian businesses (and industry bodies) to raise their strategic and operational horizons to include their immediate neighbours – the ASEAN region – in a substantive way.  Simple awareness is an issue which needs to be addressed, as much as the call to action which follows that.
  2. The recent formation of a regional "chamber of chambers" (AustCham ASEAN), led by key members of the Australian Chamber of Commerce, Singapore (and supported by the Australian Chambers of Commerce in Indonesia, Laos, Thailand, Malaysia, the Philippines and Vietnam) should be an important vehicle for a coordinated approach to ASEAN markets by, and with, Australian businesses.  It also has a key goal of educating Australian business about, and "de-mystifying", ASEAN markets.
  3. Australian peak industry bodies, such as the Clean Energy Council, should also look to broader and deeper engagement with ASEAN counterparts (possibly coordinated in some fashion by or with the aid of AustCham ASEAN), bringing their respective members with them.

Mutual gain

While there are plenty of opportunities for Australia in ASEAN economies, engagement between the regions should not flow one-way.  Australia has much to learn (and gain) from its ASEAN counterparts and, as ASEAN policy is developed, should have regard to areas of its own policy and regulation which could benefit from greater harmonisation with the ASEAN position.

This is an edited extract of ASEAN-Australia Special Summit – KWM's response for CEO roundtable discussions.

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