ADB, World Bank commit $12.5 billion to ASEAN Power Grid plan

<p class="p1"><span class="s1">The Asian Development Bank (ADB) and World Bank have launched a $12.5 billion initiative to finance regional power interconnection in Southeast Asia under the ASEAN Power Grid program.</span></p><p><span style="font-weight: 400;">The <a href="https://www.pv-magazine.com/tag/world-bank/" rel="noopener" target="_blank">World Bank</a>, <a href="https://www.pv-magazine.com/2024/11/19/adb-to-provide-160-million-to-finance-760-mw-of-solar-in-azerbaijan/" rel="noopener" target="_blank">ADB</a> and Association of Southeast Asian Nations (ASEAN) have announced a financing initiative to support the development of an ASEAN Power Grid (APG), a project </span><span style="font-weight: 400;">aiming for regional interconnection between the Southeast Asian nations by 2045.</span></p>
<p><span style="font-weight: 400;">The newly-announced ASEAN Power Grid Financing Initiative (APGF) will mobilize large-scale financing for cross-border power interconnections across land and along the seabed, in order to develop a pipeline of APG-related projects. The APGF will also facilitate ASEAN’s national utilities and sponsors to request project-specific support.</span></p>
<p><span style="font-weight: 400;">ADB has committed up to $10 billion over the next ten years, supported by an initial $6 million of technical assistance funded by itself, the United Kingdom, the European Union and other partners. Meanwhile, the World Bank is providing an initial $2.5 billion, including a $12.7 million seed grant to the ASEAN Centre for Energy (ACE), which will go toward preparing bankable projects and defining the next phase of support for the initiative.</span></p>
<p>Over the duration of the financing mechanism, both banks have committed to offer technical assistance for project preparation and capacity building, alongside a full suite of financial instruments including grants, concessional and regular loans, guarantees, political risk coverage, advisory services on public–private partnerships and equity.</p>
<p><span style="font-weight: 400;">ADB Vice-President for East and Southeast Asia and the Pacific  Scott Morris said the APG presents an extraordinary opportunity to meet Southeast Asia’s growing energy needs. </span></p>
<p><span style="font-weight: 400;">“We’re committed to building a coalition of governments, utilities, investors, and innovators &#8211; united by a shared commitment to regional energy integration – to deliver lasting benefits for generations to come,” Morris added.</span></p>
<p><span style="font-weight: 400;">An interconnection masterplan study has estimated $764 billion in investment is required to build the transmission and power generation, including high levels of variable renewable energy production, required for the APG.</span></p>
<p><span style="font-weight: 400;">According to ACE Executive Director Dato’ Ir. Ts. Razib Dawood, ASEAN currently has 7.7 GW of cross-border interconnections capacity. However, this figure will be required to more than double by 2040 to support regional growth ambitions.</span></p>
<p><span style="font-weight: 400;">During the most recent ASEAN Ministers on Energy Meeting, held in Laos in September, it was agreed the APG should not only focus on regional cross-border connectors but also address the need for domestic grid network upgrades and development of subsea power cables.</span></p>
<p><span style="font-weight: 400;">A</span> <a href="https://www.pv-magazine.com/2025/09/24/solar-wind-integration-key-to-growing-electricity-demand-in-southeast-asia-says-iea/" rel="noopener" target="_blank"><span style="font-weight: 400;">recent report</span></a><span style="font-weight: 400;"> from the International Energy Agency said integration of solar and wind energy across Southeast Asia will be crucial to meet the region’s growing electricity demand.</span></p>