DNV: Cross-border energy networks can cut US$800 billion from ASEAN’s decarbonisation cost
Published by Elizabeth Corner,
Senior Editor
World Pipelines,
DNV, the independent energy expert and assurance provider, forecasts that decarbonising the energy supply across the member states of the Association of South East Asian Nations (ASEAN) could see a staggering reduction of US$800 billion in costs through comprehensive regional collaboration encompassing power interconnectors, hydrogen networks, and energy storage infrastructure.
This compelling insight stems from the latest DNV white paper, titled "ASEAN Interconnector Study: Taking a Regional Approach to Decarbonization," released yesterday. The paper meticulously evaluates the advantages of a unified regional strategy towards decarbonising the power sector, while also addressing hurdles such as efficiently integrating the substantial influx of renewable energy.
The aspiration to achieve net-zero carbon emissions by 2050 is widely shared among the ASEAN member states. Alongside this vi-sion, there exists a longstanding goal to establish an ASEAN Power Grid, aimed at meeting the region's burgeoning energy needs while bolstering energy security. This ASEAN Power Grid could be used to support decarbonisation efforts by transporting clean energy from countries with excess renewable power to countries with shortages. However, most decarbonisation efforts to date remain confined to individual nations.
DNV models three scenarios for a decarbonised ASEAN power sec-tor by 2050: In one (‘Individual Approach’), countries try to fully decarbonise alone from their own resources. In another (‘Moderate Interconnection’), based on the ‘ASEAN RE Target Case’ in the ASEAN Interconnection Masterplan Study Phase III, there are several cross-border power interconnectors but with limited transmission capacity and no hydrogen network. The third DNV scenario (Region-al Cooperation) envisages full, unconstrained resource-sharing be-tween countries, involving power interconnectors and hydrogen networks.
The study underscores that the primary advantage of Regional Cooperation lies in minimising the necessary levels of renewable generation and energy storage to attain net-zero, thanks to the enhanced utilisation and sharing of resources from regions abundant in renewable potential.
The paper concludes, such collaborative efforts can yield substantial cost savings, optimise material resource utilisation, and reduce the land footprint required for renewable energy development. DNV estimates that Regional Cooperation can cut US$800 billion (approximately 11%) from the overall net present cost of ASEAN decarbonisation by 2050 compared with the Individual Approach, and US$300 billion (approximately 5%) compared with Moderate Interconnection.
Drawing on its findings and on discussions with stakeholders, the study makes concrete recommendations on how technical, economic, and policy hurdles to decarbonisation can be resolved in achievable chunks in the short, medium, and long terms.
“Decarbonisation is a global challenge and ASEAN countries should not address this individually. With increased cooperation and re-source sharing we can increase the speed of the energy transition while reducing the cost to consumers and the environment,” said Mats de Ronde, Team Lead, Energy Markets & Strategy APAC, Energy Systems at DNV.
“At DNV we aim to support the energy sector with insights to realise a clean, affordable and reliable energy transition. We hope that stakeholders in the ASEAN power sector find the paper useful and helps them transition faster,” added Brice Le Gallo, Vice President and Regional Director APAC, Energy Systems at DNV. “Our study forecasts power flow between ASEAN countries and regions under different scenarios. A key finding is that Moderate Interconnection offers substantial cost savings and requires limited interconnectors, meaning less resources and investment. This can be seen as a moderate step towards decarbonisation as key stakeholders recognise the benefits of cross-border interconnectors.”
Read the article online at: https://www.worldpipelines.com/business-news/18042024/dnv-cross-border-energy-networks-can-cut-us800-billion-from-aseans-decarbonisation-cost/
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