From emission-intensive to investment hotspots: Championing renewables in 3 ASEAN economies

Viet Nam, the Philippines, and Indonesia are transitioning from coal-reliant economies to renewable energy hotspots, collectively accounting for nearly 60% of ASEAN's power demand and emissions. While all three have set ambitious 2030 targets for renewables to exceed 50% of installed capacity, they face bottlenecks in permitting, grid infrastructure, and financial risk. The report highlights that solar-plus-battery integration significantly improves internal rates of return (IRR), particularly in Indonesia, and emphasizes the role of market reforms—such as Viet Nam's Direct Power Purchase Agreements and the Philippines' removal of foreign ownership restrictions—in attracting private capital.

• Viet Nam, the Philippines, and Indonesia have set ambitious 2030 solar capacity targets of 73 GW, 14 GW, and 13 GW respectively, aiming for renewables to constitute over 50% of their installed capacity.
• The implementation of Direct Power Purchase Agreements (DPPA) in Viet Nam could potentially increase the country's renewable energy share from 19% to 42%, provided the processing sector participates.
• Integrating battery storage significantly enhances the Internal Rate of Return (IRR) for solar projects in Indonesia and Viet Nam, while returns in the Philippines remain steady.
• Solar project profitability in these markets is highly sensitive to PPA prices and capital costs; a 10 percentage point change in either can shift the IRR by up to 45 percentage points.
• The Philippines has increased its attractiveness to foreign investors by removing foreign ownership restrictions in the renewable sector, leading to 20 GW of projects being awarded to overseas developers since 2022.
• Indonesia is improving PPA bankability through MEMR Regulation No. 5/2025, which introduces risk-sharing for currency exchange volatility and recognizes the economic value of carbon credits.
• Administrative and regulatory bottlenecks, such as overlapping land rights and delayed transmission studies, continue to hinder investment and reduce project IRRs.

APA

Setyawati, D. D., Nadhila, S., & Demoral, A. (2025). From emission-intensive to investment hotspots: Championing renewables in 3 ASEAN economies. Ember. https://ember-energy.org/app/uploads/2025/12/Championing-renewables-in-3-ASEAN-economies-PDF.pdf

Chicago

Setyawati, Dr Dinita, Shabrina Nadhila, and Alnie Demoral. From emission-intensive to investment hotspots: Championing renewables in 3 ASEAN economies. Ember, 2025. https://ember-energy.org/app/uploads/2025/12/Championing-renewables-in-3-ASEAN-economies-PDF.pdf.

Wikipedia

{{cite report |last1=Setyawati |first1=Dr Dinita |last2=Nadhila |first2=Shabrina |last3=Demoral |first3=Alnie |title=From emission-intensive to investment hotspots: Championing renewables in 3 ASEAN economies |publisher=Ember |date=2 December 2025 |url=https://ember-energy.org/app/uploads/2025/12/Championing-renewables-in-3-ASEAN-economies-PDF.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{setyawati2025from, author = {Setyawati, Dr Dinita and Nadhila, Shabrina and Demoral, Alnie}, title = {{From emission-intensive to investment hotspots: Championing renewables in 3 ASEAN economies}}, institution = {Ember}, year = {2025}, month = dec, url = {https://ember-energy.org/app/uploads/2025/12/Championing-renewables-in-3-ASEAN-economies-PDF.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }