**4. Results and Analyses**

The results of various energy supply and demand scenarios in ASEAN are in Tables A1–A8. ASEAN's energy system is predicted to be more efficient because energy intensity is expected to drop from the baseline in the future scenarios. However, the energy system will largely depend on fossil fuel consumption. The results from the energy model predicted that all ASEAN's emissions in the future scenarios will remain high because fossil fuel remains the dominant share in the future energy mix. Fossil fuel consumption—coal, oil, or natural gas—is associated with emissions, although natural gas has less emissions than coal and oil. It is also important to note that the trend of natural gas use in the energy transition is very promising, as its share has grown quickly in the primary energy mix as well as in power generation. Thus, ASEAN's energy transition will need to consider cleaner use of fossil fuels through clean technologies and a gradually increasing share of renewables and clean energy. Any policy changes to meet the emissions reduction in ASEAN need to be cautioned about high energy costs, energy access, affordability, and energy security risks. Below are the key results from the study.

**More efficient use of energy.** ASEAN's primary energy supply grows at an annual average rate of 3.1% from 2017 to 2050 under the BAU scenario, reaching 1823 million tones of oil equivalent (Mtoe) in 2050 from 639 Mtoe in 2017 (Figure 2). However, under the APS of ambitious emissions reduction targets (APS\_EmT), the primary energy supply is predicted to reduce by 21% and 44% from the BAU in 2030 and 2050, respectively (Tables A1 and A2). ASEAN as a group achieves a significant reduction in energy intensity of 30.3% in the BAU case (a drop of energy intensity from 228 in 2017 to 154 in 2050). However, the scenario of emissions reduction targets (APS\_EmT) could achieve a reduction of 60% in energy intensity in 2050 from the BAU scenario (a drop of energy intensity from 228 in 2017 to 86 in 2050) (Figure 3).

**Reliance on fossil fuel consumption.** The results from the energy demand and supply modelling under various policy scenarios draw attention to the high reliance on fossil fuel use in ASEAN's energy system. The total combined share of fossil fuels (oil, gas, and coal) in the primary energy supply was 78% in 2017; and they are predicted to have an 87%, 82%, and 80% share in 2050 under the BAU, APS, and APS with emission reduction targets (APS\_EmT) scenarios, respectively (Figures 4 and 5).

Oil remains the dominant fuel in the primary energy supply, with a share of 37% in 2017. The share of oil is projected to be 42%, 41%, and 38% in the BAU scenario, APS, and APS\_EmT in 2050, respectively (Figures 6 and 7). Oil is mainly used in the transport and industrial sectors in the final energy demand. The share of oil in the final energy demand was 45% in 2017, and its share grows to 51%, 50%, and 49% in 2050 for the BAU scenario, APS, and APS\_EmT, respectively. This indicates that ASEAN as a group will rely heavily on oil consumption for the foreseeable future. For most countries in ASEAN, the growing oil

import dependency will need to be safeguarded by resilient infrastructure and mechanisms such as oil stockpiling (either government stock or inventory stock by the oil importing companies). Most countries in ASEAN have a stock requirement of 15–50 days, varying from country to country. However, the stock requirement for OECD members will need to be at least 90 days of net oil imports to meet the emergency oil stock holding requirement in case of supply disruption (IEA, 2020) [24].

**Figure 2.** Primary Energy Supply (TPES) in ASEAN. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual, Mtoe = million tones of oil equivalent, TPES = total primary energy supply. Source: Authors' calculations.

**Figure 3.** Energy Intensity in ASEAN. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual, GDP = gross domestic product. Source: Authors' calculations.

**Figure 4.** Share of Fossil Fuels (Coal, Oil, Gas) in the TPES. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, BAU = business as usual, TPES = total primary energy supply. Source: Authors' calculations.

**Figure 5.** Share of Fossil Fuels in the Power Mix. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, BAU = business as usual. Source: Authors' calculations.

The share of coal in the primary energy supply was 22% in 2017; and it is predicted to be 23%, 17%, and 14% in the BAU scenario, APS, and APS\_EmT in 2050, respectively. Coal has the second largest share in power generation, at 37% in 2017; and it is predicted to be 36%, 27%, and 19% in the BAU scenario, APS, and APS\_EmT in 2050, respectively. Under the APS of emission reduction targets (APS\_EmT), the share of coal is projected to drop significantly for both the primary energy supply as well as the share in the power generation mix (Figures 8 and 9).

**Figure 6.** Oil Share in TPES in ASEAN. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual, TPES = total primary energy supply. Source: Authors' calculations.

**Figure 7.** Oil Share in Final Demand in ASEAN. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual. Source: Authors' calculations.

Although ASEAN relies heavily on fossil fuels (oil, coal, and gas), some AMS have shifted drastically to use more gas in power generation and other final uses, such as the industrial and transportation sectors. ASEAN as a group had a 20% share of gas in the primary supply in 2017, but its share in the primary energy supply is projected to increase to 25% and 23% in 2050 for the BAU case and APS, respectively. Remarkably, the share of gas, at 40% in 2017, was a dominant fuel in the power generation mix; and it is projected to increase to 46%, 45%, and 44% in 2050 for the BAU case, APS, and APS\_EmT, respectively (Figures 10 and 11).

**Figure 9.** Coal Share in Generation Mix in ASEAN. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual. Source: Authors' calculations.

**Increasing but not sufficient share of renewables.** The share of renewables (hydropower, geothermal, biomass, wind, and solar) in the power mix was 21% in 2017. Its share is projected to increase to 36%, 28%, and 27% in the APS\_EmT, APS\_RE, and APS in 2050 (Figure 12). The share of renewables is projected to be higher in 2030 than 2050 because hydropower and geothermal resources are limited. However, the share of wind and solar is projected to increase from 2% in 2017 to 18%, 12%, and 11% in 2050 under the APS\_EmT, APS\_RE, and APS, respectively (Figure 13).

**Figure 10.** Gas Share in TPES in ASEAN. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual, TPES = total primary energy supply. Source: Authors' calculations.

**Figure 11.** Gas Share in Generation Mix. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual. Source: Authors' calculations.

Although renewables are key to achieving emissions reductions, their share in the energy mix is not high enough to decarbonize emissions to meet the climate target of reducing emissions to net zero from 2050 until the turn of this century (Figures 14 and 15).

**Figure 13.** Share of Wind and Solar in Power Mix. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual. Source: Authors' calculations.

Achieving the APS\_EmT is very unlikely because this scenario assumes the most efficient technologies and the highest share of renewables to achieve emissions reduction targets. Although the emissions reduction target was set at 80% from the BAU scenario to the APS\_EmT, given the plausible challenges of integrating wind and solar in ASEAN's system, only 55% could be achieved for all combined types of renewables. Thus, the remaining emissions coming from fossil fuels will need to be decarbonized through CCUS technologies or the growth of natural carbon stock.

**Figure 14.** Emission Reduction in Various Scenarios. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual. Mt-C = million tonnes of carbon. Source: Authors' calculations.

**Figure 15.** Emission Reduction in the Power Mix. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual. Source: Authors' calculations.

**ASEAN's emissions keep increasing in the foreseeable scenarios.** ASEAN as a group will see emissions doubling or tripling from 2017 to 2050, varying from the BAU case to the APSs. In the BAU scenario, emissions could reach 1217 million tonnes of carbon (Mt-C), almost triple the baseline level of 376 Mt-C in 2017. However, emissions could also be lower, at 876 Mt-C for the APS and 563 Mt-C for the APS\_EmT (Figure 14). To limit the global temperature rise to 1.5 ◦C by 2100, emissions will need to be slashed by 45% from 2010 levels by 2030, then reach net zero emissions by 2050 (The Climate Reality Project, 2018) [25]. Thus, ASEAN as a group will miss this target and it will make it more difficult to cut emissions by 2050.

**Required investment in power generation.** Figure 16 is the estimated required investment for solar and wind energy. For the Small Modular Reactors (SMR) is not included in this estimation because ASEAN does not have plan to introduce nuclear power plant soon, although they keep this option open for the future. Thus, only solar and wind are estimated.

**Figure 16.** Required Investment for Variable Renewable Energy (Solar and Wind) by 2050. APS = alternative policy scenario, APS\_EI = alternative policy scenario with energy intensity targets, APS\_EmT = alternative policy scenario with emission reduction targets, APS\_RE = alternative policy scenario with renewable targets, ASEAN = Association of Southeast Asian Nations, BAU = business as usual. Source: Authors' calculations.

Accelerating the share of variable renewables, such as solar and wind, in ASEAN's power mix will require \$56 billion–\$118 billion from the BAU scenario to the APSs in the case of solar photovoltaic and \$12 billion–\$50 billion in the case of wind, in 2050 (Figure 16). The total investment in the power generation of additional capacity will be \$540 billion in the BAU scenario and \$511 billion in the APSs—reflecting the reduced investment in fossil fuels and the increase in renewables, which will have less capital costs, driven by technological development, expected in 2050.
