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The Security of the Future Natural Gas and Coal: How ASEAN Should Face the Challenges?

16 December 2022

Wednesday, December 14, 2022 — 13.00-15.00 GMT+7ASEAN Centre for Energy (ACE) held a virtual public webinar of the 7th ASEAN Energy Outlook (AEO7) taking the topic of “The Security of the Natural Gas and Coal: How ASEAN Should Face Future Challenges?” on Wednesday, December 14, 2022. The webinar was attended by ASEAN focal points and public participants which aimed to respond to ASEAN’s challenges for the future changing supply of natural gas and coal and the possibility of establishing ASEAN’s collaboration. The webinar also invited panelists from ASEAN Council on Petroleum (ASCOPE), ASEAN Forum on Coal (AFOC), and Economic Research Institute for ASEAN and East Asia (ERIA) to deliver some insights about the region’s energy security and fossil fuel value chains.

The webinar started with the quiz session, facilitated by Ms. Amira Bilqis, Associate Officer of Energy Modelling and Planning (MPP) of ACE, to understand the participant’s knowledge about the energy landscape in ASEAN.

Moreover, to give the audience an overview of the energy transition landscape in ASEAN, Ms. Alnie Demoral, Lead Modeller of AEO7 from ACE, introduced AEO7, the crucial report to support APAEC Phase II initiatives and to address the challenges of ASEAN energy dynamics. She highlighted the expected demand and supply forecast of the region’s energy consumption, which will triple in 2050 from 2020, especially oil, coal, and natural gas. Based on the scenarios in coal and natural gas usage, ASEAN will become a net importer of natural gas by 2025 and coal by 2039. However, if ASEAN can achieve Renewable Energy (RE) and Energy Efficiency (EE) targets, we can delay the importation of natural gas by one year and stabilize the coal security after 2050.Panellist Session

As the core of the event, the panel session was moderated by Mr. Adhityo Gilang Bhaskoro, Research Analyst of Power, Fossil Fuel, Alternative Energy and Storage (PFS) of ACE. The session was a free-flow discussion with several questions from the moderator. In the end, the panelists concluded the discussion on how ASEAN member states could work together to maintain energy security in this region.Ms. Aunchana Yenrudee, the Senior Analyst of PTT Thailand and ASCOPE Representative shared her view that ASEAN will face many challenges natural gas for sustainable development because they are highly important to power generations for the energy transition. The current energy crisis affects the high energy demand growth due to the surging energy price, and that ASEAN needs to create a pricing framework to facilitate the use of gas. In addition, Ms. Auncha noticed that regulatory reforms are necessary to increase competition and improve the future environmental regional carbon market operation.

An Energy Economist of ERIA, Dr. Alloysius Joko Purwanto, emphasized natural gas as the cleanest fossil fuel, which held a crucial role in the energy transition for the modern use of energy and the improvement of renewable electricity. The government needs to provide standardization regulations on LNG (Liquefied Natural Gas) facilities and ease investors to facilitate LNG in facing the surging prices. He also pointed out that ASEAN needs two levels of consultation: at the ASEAN level to coordinate between the region’s consumers and producers; and between ASEAN and other exporter countries. With the current volatile fuel prices, the petroleum boom has been the driver in the energy transition, as it will spur the demand for electric vehicles (EVs). However, the government must consider the long-term and short-term of how the oil price will increase

Furthermore, Ms. Alnie Demoral, Lead Modeller of AEO7 from ACE, proceeded with the previous argument that natural gas is necessary for energy transition and needs to shift the importation of natural gas to less risky and more realistic. Moreover, she viewed that ASEAN is difficult to fully eradicate fossil fuels because they are still important resources in the region’s development. Consequently, it is necessary to reduce the emission deriving from clean technologies. She further explained that ensuring energy security refers to the availability of various energy sources that can provide energy demand.

Ir. Helmi Zaihan, Assistant Director of Energy Commission Malaysia and AFOC Representative, explained how crucial coal is for ASEAN and addressed using coal efficiently and integrating it with clean technology, despite the limitation of financing. He shared that we can’t afford to stop using coal abruptly in the future, as it would affect economic and energy security. Recently, the Russia conflict led to a higher price of coal, which directly increased the generation cost of electricity and the cost of living. Given the current situation, Malaysia has been reviewing the coal prices and procurement process to allow more companies to participate in Malaysia tenders.

Finally, the panelists came to the conclusion that ASEAN needs to ensure energy security, affordability, and environmental sustainability to develop RE in the region. Moreover, ASEAN could strengthen the collaboration in the region by establishing internal—within ASEAN—and external discussions—with other energy producer countries. ASEAN should provide a platform to share the best practices in maintaining energy security by adopting emerging clean technologies. Besides, ASEAN needs to enhance the integration of the national power system for AMS to enable power trade within the region.


To learn more about this topic:

Watch the recording video of the webinar series

Access The 7th ASEAN Energy Outlook (AEO7)