Energy Storage Essential to ASEAN Nations’ Knowledge-Based Economy Transition

July 1, 2026 — Rising coal and gas costs are increasing pressure on Southeast Asian economies to accelerate the transition toward renewable energy, with energy storage emerging as a critical tool for improving energy security, reducing electricity costs and integrating renewable power.

Energy expert and UAE Ministry of Energy senior advisor Shuvendu Bose said Southeast Asian countries could achieve stronger economic growth by shifting toward knowledge-based economies, where energy costs will become an increasingly important factor in maintaining industrial competitiveness.

As automation and artificial intelligence reduce the importance of labour-intensive manufacturing, electricity costs are expected to become a key determinant of ASEAN’s competitiveness. At the same time, coal and LNG prices remain vulnerable to global market volatility, increasing the long-term risks of relying heavily on fossil fuels.

Renewable energy therefore offers an increasingly attractive pathway for ASEAN economies. However, the variable nature of solar and wind generation creates a need for greater system flexibility. Battery energy storage systems (BESS), both standalone and co-located with renewable projects, can help integrate variable renewable energy and make clean power more dispatchable.

Strategically located energy storage can also help flatten electricity demand curves, reducing the need to build generation and grid infrastructure solely to meet short periods of peak demand. This could improve overall system efficiency while supporting the expansion of renewable energy across the region.

Thailand is also placing greater emphasis on energy storage, virtual power plants (VPPs), rooftop solar and energy efficiency as part of its long-term energy strategy. Thai Ministry of Energy representative Dr Veerapat Kitafuengfoo stressed that ASEAN countries need stronger regional cooperation to improve energy security and reduce exposure to volatile fossil-fuel prices.

Regional coordination will be increasingly important, including harmonised regulations, coordinated market design and cross-border clean-energy cooperation. Industry representatives also highlighted that energy storage is no longer an optional technology, but an increasingly important asset for both national power systems and the wider ASEAN energy transition.

As electricity demand continues to rise across Southeast Asia, particularly from manufacturing, digital infrastructure and emerging AI-driven industries, the combination of renewable energy and energy storage could become a key foundation for ASEAN’s future economic competitiveness and energy security.