Commentary: With 6 months left as chair, Malaysia should double down on the 40-year ASEAN Power Grid dream

CNA

a day ago

KUALA LUMPUR: One way to understand how the Association of Southeast Nations (ASEAN) works is to look at the 46th ASEAN Summit 's gala dinner on May 26. The night was a cultural tour de force, led by the world-renowned Malaysian Philharmonic Orchestra, unleashing not only the heritage of the host nation, Malaysia - in songs, costumes, dance - but also each of the other member states.
The highest diplomatic point happened at the midpoint of the dinner. Three Malaysian singers broke into a medley of folk songs from every ASEAN country: the classic Sabai Sabai of Thailand, love ballad Pka Sla of Cambodia, archipelago Rasa Sayang of Indonesia, gentle Dok Champa of Laos, radio-favourite Shwe Pyi Tike of Myanmar, harmonious Bayan Ko of the Philippines, famous Home of Singapore, up-tempo Trong Com of Vietnam, recognisable Adai-Adai of Brunei, patriotic Sejahtera Malaysia of Malaysia, and Oh, Oh Timor of soon-to-be member Timor-Leste.
Leaders smiled and cheered when they heard their songs. Thai Prime Minister Paetongtarn Shinawatra took out her camera and recorded before giving the thumbs up; Timor-Leste Prime Minister Kay Rala Xanana Gusmao cheered and waved his flag.
Southeast Asia is about respecting differences, and the prerequisite of any collaboration is trust. Every country needs to feel like they are heard and have a place. No country is more important than the other. This is also why ASEAN has always been perceived as friendly but fragmented, progress stable but stalling.
A TURNING POINT FOR ASEAN?
When Malaysia took over the rotating chairmanship in 2025, many hoped it would usher in a new era of regional cooperation and decisive action. The timing seemed right.
Geopolitical tensions necessitated stronger regional trade and integration. New leaders of member states seemed to agree on core economic growth items such as green energy, digitalisation and trade.
The new chair, led by Malaysian Prime Minister Anwar Ibrahim, also seemed to command respect from others. Mr Anwar's mix of decades-long international network and personal charisma is unquestioned. ASEAN's rising middle class is ripe for an institutional turning point.
However, a one-year timeline to coordinate structural changes in a loose regional system is overwhelming. Other member states may not have the same urgency for regional victory as the host nation, as domestic issues typically dominate leaders' day-to-day.
United States President Donald Trump's 'Liberation Day' tariffs threw off the world, with a baseline 10 per cent for most countries, including Singapore, and as much as 49 per cent for Cambodia. ASEAN countries scrambled for bilateral carve-outs, amid stock market rout and currency declines, instead of adopting a bloc-wide approach.
The sobering truth is that ASEAN concerns come second after domestic concerns. This is not unique to ASEAN; it is the reality of every loose non-integrated bloc. Against this backdrop, any lasting legacy-building work for ASEAN must be of equal or more importance to their domestic issues.
ASEAN POWER GRID
With six months left as chair, Malaysia would do well to double down on the ASEAN Power Grid (APG) development, a project that has the potential to deliver structural, lasting impact.
Almost every region has plans for something similar. Europe (ENTSO-e), Southern Africa (SAPP), Central America (SIEPAC), Central Asia (CASA-100), and even Australia to Singapore.
A supergrid for the region effectively makes borders invisible, creating superhighways for electrons to pass through land and sea, so that clean energy from the mountains and desert can power the city lights in another country.
Kuala Lumpur and Bangkok's midday solar energy could be complemented by Mekong River's hydro energy at night. Indonesian and Filipino geothermal power could backstop variable changes of Ho Chi Minh, Manila and Singapore.
For the ordinary person, this would promise cheaper bills, fewer blackouts, cleaner air, new jobs and higher income.
Countries such as Vietnam, Laos, Indonesia and Myanmar that export clean energy can earn foreign revenue with reliable buyers. Transit states like Thailand, Malaysia, Brunei pocket the wheeling charges (fees paid to transmit electricity through a grid) to fund grid upgrades. Import-heavy sites (Singapore, Kuala Lumpur, Ho Chi Minh, Manila) secure clean, stable electricity and hedge against global fuel shocks.
Although the APG idea was mooted as early as 1981, it went through a slow burn where progress was limited to research and interconnection builds. The first real demonstration was in 2018 when 100 megawatts (MW) of Laos hydropower slipped through the existing Thai gridlines and landed in Malaysia. It was the first time three ASEAN countries' power systems traded across borders. Wheeling charges, grid codes, legal agreements and political will made it happen.
Then it went further. Singapore joined in. This time, with Thailand and Malaysia acting as the wheeling states. 100MW from Laos to the island state. Then 200MW, and talks went as far as 300MW.
Now a fifth country, Vietnam, might join in a big way.
MAKING THINGS HAPPEN
Perhaps the most important agreement signed at the 46th ASEAN meeting is the potential Vietnam-Malaysia-Singapore project to transmit offshore wind energy from Vietnam to Malaysia and Singapore. This means that on top of the Laos-Thailand-Malaysia-Singapore transmission over land, we might have another subsea cable transmission from Vietnam to Malaysia and Singapore.
Granted, these infrastructure projects take time to build. Even feasibility studies typically take months to years. However, there are a few structural changes that could be completed by Malaysia in a few months to leave a legacy as ASEAN chair.
First, set a transparent wheeling charges formula. Now, most deals are negotiated from scratch on a case-by-case basis, resulting in protracted timelines. While a 'reasonable' rate varies widely, adopting best practices from other supergrids, like Southern African Power Pool may expedite this process. Rather than imposing exact rates, the formula could agree on key components, such as the proportion of network used, age of assets and replacement cost, and allowance for maintenance and operational costs. Analysts have widely agreed that this is one of the most consequential items for the APG.
Second, expand the capacity target for Laos-Thailand-Malaysia-Singapore Power Integration Project. Part of the reason this pilot did not progress further is also due to the lack of transparent wheeling charges formula. If this can be solved, setting a capacity target higher than 300MW is important as a showcase of what the APG could become. The critical paperwork is already in place - they could be boilerplates for others. Scaling from here is easier than any new project.
Third, a fully funded tripartite feasibility study (Vietnam-Malaysia-Singapore) with a time-bound path to a term sheet. Based on other similar projects, a concept-to-term-sheet timeline is typically four to six years. While it can't be achieved within this ASEAN term, the most important thing to do is to ensure feasibility study is started, with the backing of governments and multilateral development banks. If political and technical certainty can be secured, the remainder terms would be more mechanical than existential.
In regional cooperation, the most difficult thing to do is to search for something concrete. Broad base frameworks set an umbrella of goodwill for discussions, but they must be translated into something tangible and beneficial to all involved.
The APG still remains the highest leverage item for ASEAN, and it could potentially set off a series of deeper cooperation between nations. At the very least, it could be the very few items that would make many member states care more than their domestic issues.