Solar Power Could Save ASEAN Up to $67 Billion vs Planned Gas Expansion, Analysis Shows

Summary

Southeast Asia could save as much as $67 billion by replacing planned gas-fired power expansion with solar, according to a new analysis. Under current ASEAN energy transition plans, gas capacity is projected to nearly double to 200 GW by 2030. Generating the same amount of electricity from gas could cost between $71 billion and $109 billion annually at current and projected LNG prices, compared with around $42 billion from solar. The report warns that heavy reliance on imported fossil fuels leaves the region exposed to supply and price shocks, especially following recent disruptions in the Strait of Hormuz.

Recount of Events

Analysis highlights that 84% of crude oil and 83% of liquefied natural gas (LNG) passing through the Strait of Hormuz in 2024 was destined for Asia. Singapore sourced 42% of its LNG imports from Qatar last year, while Thailand sourced 27%. Japan imports over 90% of its crude from the Middle East, South Korea around 70%, and China over 40% in 2025.

The analysis notes that ASEAN’s planned gas expansion would significantly increase the region’s exposure to global price volatility. At prevailing LNG prices, operating the full gas fleet could cost around $71 billion per year, rising to as much as $109 billion under higher price scenarios. In contrast, the same volume of electricity from solar would cost roughly $42 billion.

Commentators argue that fossil fuel import dependence continues to risk energy security. “While energy saving can be an initial short-term solution, the pivot to homegrown renewables can provide more options to buffer future energy shocks,” she added.

The report also cautioned against a short-term return to coal as an alternative, noting that coal prices have risen about 15% to around $134 per tonne, with generation costs still significantly higher than solar paired with battery storage.

Analysis

From an Indonesian vantage point, the recent reports findings are both timely and instructive. Indonesia is a major coal producer and exporter, yet we also face rising domestic energy demand and exposure to global price swings through imported refined products and LNG. The stark cost difference between solar and gas — $42 billion versus up to $109 billion for the same electricity output — underscores how continued reliance on imported fossil fuels locks in volatility for businesses, households and government budgets.

The analysis reinforces a broader point: energy security in ASEAN is no longer just about securing supply — it is about choosing the right mix that delivers cost stability and resilience. For Indonesian industries, particularly manufacturing, nickel processing and EV battery production, affordable and predictable power is essential. Solar, with its rapidly falling costs and domestic deployment potential, offers a more controllable long-term solution than imported LNG, which remains subject to geopolitical shocks and bidding wars.

Several hard questions remain under-discussed in regional policy circles:

• If solar can deliver the same electricity at roughly half the cost of gas, why are ASEAN countries still planning such a large gas buildout by 2030?

• With over 99% of the region’s wind and solar potential still untapped, why isn’t there a bolder, coordinated ASEAN-wide renewable acceleration plan with shared financing mechanisms?

• How will individual governments manage the fiscal and inflationary pressure from higher energy prices without coordinated regional buffers or joint procurement strategies?

• For Indonesia specifically, with our abundant solar resources and growing downstream industrial base, are we moving fast enough to integrate renewables into the grid to support nickel and EV ambitions?

The Middle East crisis has once again exposed the risks of heavy fossil fuel import dependence. Ember’s numbers make a compelling economic case for renewables: lower long-term costs, reduced exposure to global price shocks and greater energy sovereignty. For businesses across ASEAN, the message is clear — the transition is not just an environmental imperative; it is becoming a core competitiveness issue. The countries and companies that act decisively on solar and storage will be far better positioned to weather the next energy shock.