Regional power trade offers Phl supply safety net

SINGAPORE — The Philippines could gain another lifeline against electricity shortages and supply disruptions as the United States and Singapore advance efforts to unlock cross-border power trading across Southeast Asia.

The initiative could eventually allow the country to import electricity from neighboring markets when domestic supply tightens, while opening new investment opportunities in submarine power cables and renewable energy development.

In a joint statement issued Wednesday, Singapore's Ministry of Energy, Trade and Industry, Energy Market Authority and the US Department of Energy unveiled preliminary findings of a feasibility study identifying regulatory and financing reforms needed to accelerate the ASEAN Power Grid.

For the Philippines, stronger regional electricity connections could help diversify power sources, reduce exposure to domestic supply constraints, and improve energy security as demand continues to rise.

Energy Secretary Sharon S. Garin said interconnected power systems would provide countries with greater flexibility in managing electricity supply, particularly during periods of tight generation capacity.

“Interconnected systems give us what no single country has by itself: cross-border electricity trade, better use of the resources we already have, and another line of support when supply tightens,” Garin said.

She noted that the Philippines' own experience in connecting its island grids demonstrates the complexity of building large-scale transmission networks.

“We know this from experience. Connecting our own islands took years of planning, regulation that fit together, and financing that made sense,” she said.

Unlike mainland Southeast Asian countries, the Philippines would require submarine transmission cables to establish electricity connections with neighboring markets.

These projects could eventually allow the country to access additional electricity supplies during shortages and potentially export surplus renewable energy, creating new opportunities for power developers and investors.

However, significant financing requirements, differences in national regulations and the absence of common cost-sharing arrangements remain major obstacles to regional power trading.

The second phase of the US-Singapore feasibility study, launched in October 2024, examines the legal, governance and financing frameworks needed to address these challenges.

“Preliminary findings highlight the need for stronger regional governance and cooperation, and greater alignment of legal and regulatory frameworks across ASEAN to support subsea interconnection development,” the three agencies said in their joint statement.

The study also identifies financing approaches to attract investments in submarine electricity connections, including mechanisms to reduce project risks and determine how costs should be shared among participating countries.

These measures could help make capital-intensive transmission projects more commercially viable and encourage greater private sector participation.

Garin said regional cooperation must now translate into practical arrangements that would allow electricity to move across national borders.

“That is the work ahead for ASEAN: coordinated planning, compatible regulation, commercially viable arrangements and sustainable investments. The Philippines will keep working with every member state until this grid is operating,” she said.

The study builds on an earlier assessment of Southeast Asia's existing electricity infrastructure, including submarine connections, and the potential socioeconomic benefits of stronger regional integration.

The US Department of Energy's National Laboratory of the Rockies and Pacific Northwest National Laboratory are scheduled to present the preliminary findings during the 19th Singapore International Energy Week on Wednesday.

The final report is expected by early 2027.

The findings will support the development of the ASEAN Power Grid, including the ASEAN Submarine Power Cable Development Framework, and strengthen regional cooperation under the ASEAN Plan of Action for Energy Cooperation 2026–2030.

Singapore and the United States also committed to deepening cooperation on regional electricity connectivity, energy security and energy technologies ahead of the 50th anniversary of US-ASEAN relations in 2027.

While the proposed regional grid could provide the Philippines with additional electricity supply options, its potential impact on power costs and reliability will depend on the completion of actual interconnection projects and the commercial terms of future electricity trading arrangements.