Leveraging global capital towards clean energy as ASEAN races to the Summit

This policy brief by Ember examines the financing landscape for ASEAN's energy transition, highlighting a significant investment gap and the varying roles of bilateral partners like China, Japan, and the United States. It argues that the Philippines' 2026 ASEAN Chairmanship provides a strategic opportunity to coordinate regional industrial strategies—such as Indonesia's nickel downstreaming and Viet Nam's solar manufacturing—to move the region up the clean energy value chain.

• ASEAN requires substantial annual investment to meet its energy transition goals, with estimates suggesting a need for at least US$281 billion annually by 2035 for clean energy generation, grids, and enabling infrastructure. This represents at least a fourfold increase over the annual investment levels seen between 2015 and 2023, when total energy-related financing disbursed was roughly US$60 billion.
• China provides the largest volume of energy-related finance to ASEAN, focusing on large-scale, asset-led infrastructure such as coal-fired power plants, hydropower, and high-voltage transmission. However, approximately 95% of this official development finance is provided at market-based rates without subsidies, which increases debt sustainability risks for recipient nations.
• Japan's financing approach is characterized as more balanced and system-focused, emphasizing technology transfer, capacity building, and incremental upgrades to address system bottlenecks. Key priorities include hydropower rehabilitation in Lao PDR, Viet Nam, and Cambodia, geothermal development in Indonesia, and rural electrification in Myanmar and Cambodia.
• The United States utilizes a blended finance model designed to mobilize private capital rather than providing direct asset financing. This approach focuses on system-level support, including technical assistance, regulatory partnerships, and improving utility governance to derisk projects for private investors.
• ASEAN member states are implementing diverse industrial strategies to capture value from the clean energy transition: Indonesia is using a "downstreaming" strategy for nickel and minerals to feed the EV battery market; Viet Nam has become a leading solar manufacturing hub, accounting for roughly 5% of global PV supply; and Thailand is developing an EV manufacturing ecosystem through the EV 3.5 Package.
• The 2026 ASEAN Summit, chaired by the Philippines, is identified as a critical platform to transition from fragmented national efforts to coordinated regional value chains. The brief suggests using the chairmanship to align national industrial priorities and create regional-scale investment opportunities in priority areas like battery systems and solar PV components.

APA

Demoral, A., & Setyawati, D. (2026). Leveraging global capital towards clean energy as ASEAN races to the Summit. Ember. https://ember-energy.org/app/uploads/2026/01/Policy-Paper-Leveraging-global-capital-towards-clean-energy-as-ASEAN-races-to-the-Summit.pdf

Chicago

Demoral, Alnie, and Dinita Setyawati. Leveraging global capital towards clean energy as ASEAN races to the Summit. Ember, 2026. https://ember-energy.org/app/uploads/2026/01/Policy-Paper-Leveraging-global-capital-towards-clean-energy-as-ASEAN-races-to-the-Summit.pdf.

Wikipedia

{{cite report |last1=Demoral |first1=Alnie |last2=Setyawati |first2=Dinita |title=Leveraging global capital towards clean energy as ASEAN races to the Summit |publisher=Ember |date=28 January 2026 |url=https://ember-energy.org/app/uploads/2026/01/Policy-Paper-Leveraging-global-capital-towards-clean-energy-as-ASEAN-races-to-the-Summit.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{demoral2026leveraging, author = {Demoral, Alnie and Setyawati, Dinita}, title = {{Leveraging global capital towards clean energy as ASEAN races to the Summit}}, institution = {Ember}, year = {2026}, month = jan, url = {https://ember-energy.org/app/uploads/2026/01/Policy-Paper-Leveraging-global-capital-towards-clean-energy-as-ASEAN-races-to-the-Summit.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }