Powering Prosperity: Unlocking East Asia’s Renewable Energy for Growth and Competitiveness

With vast, untapped renewable resources, East Asia can accelerate its clean energy transition-boosting competitiveness, creating millions of jobs, and strengthening energy security. A new World Bank report charts how.

East Asia's industrial rise has been powered by coal in recent decades - delivering rapid growth - but also making the region a major contributor to global greenhouse gas emissions. Today, the economics and the imperatives have shifted. A new World Bank Group report, Green Horizon: East Asia's Sustainable Energy Future, finds that the region's enormous, but largely untapped, renewable energy potential can fuel the next wave of growth, secure affordable energy, and enhance competitiveness.

Launched at the Clean Energy Ministerial Meeting in Busan, Korea, in August 2025, the report focuses on practical pathways to decarbonize power and industry-sectors that together account for an estimated 75-87 percent of the region's emissions. It maps a four-part strategy: improve energy efficiency, accelerate electrification, expand renewable energy, and deploy advanced technologies such as green hydrogen and carbon capture, utilization, and storage (CCUS). At the 2025 Singapore International Energy Week (SIEW), a deep-dive session built on the report's findings, exploring how priority countries can leverage renewables to spur private investment, create jobs, and safeguard energy security and affordability.

The Scale of Challenge-and Opportunity

Four economies-China, Indonesia, Viet Nam, and the Philippines-sit at the heart of East Asia's energy transition. Collectively, they account for nearly 60 percent of global coal consumption and more than 40 percent of annual greenhouse gas emissions, exceeding the combined emissions of all OECD economies. Emissions growth has largely been driven by the power and industrial sectors, reflecting rapidly rising electricity demand and continued reliance on coal. Without decisive action, the region's electricity demand is projected to double over the next three decades, a trajectory incompatible with climate goals and long-term competitiveness.

Yet the renewable energy opportunity is extraordinary. Across these four countries, the report estimates approximately 65,000 gigawatts (GW) of renewable potential-97 percent of which remains untapped. Hydropower has long been a backbone of several national grids, but solar and wind are expanding quickly and now represent the most promising vectors for scale. Offshore wind, in particular, is poised to play a catalytic role: Viet Nam and the Philippines together hold over 770 GW of offshore wind potential, offering a compelling answer to rising demand and a platform for regional supply chains.

"Decarbonization represents not only a commitment of Indonesia, but also a strategic pathway to strengthen competitiveness, industrial resilience, and energy security," said Dr. Ir. Hendra Iswahyudi, Director of Energy Conservation at Indonesia's Ministry of Energy and Mineral Resources.

Conducive Policies, Private Finance, and Jobs

Decarbonizing the power systems of China, Indonesia, the Philippines, and Viet Nam will require an unprecedented US$9 trillion in investment over the next two decades. While public capital will play a key role in de-risking new technologies, private capital-domestic and international-will be the key driver of change, accelerating commercial and financial market development with broader economy-wide benefits.

The Green Horizon lays out four no-regret actions to mobilize investment at scale. These are expected to enhance investors' confidence and energy security, serving not only renewable energy targets, but also broader high-income ambitions of emerging markets:

1. Establish a conducive investment climate: Clear, predictable policy frameworks matter. Transparent tariff-setting, competitive procurement, and standardized, bankable power purchase agreements lower financing costs and accelerate project timelines.
2. Implement coordinated power system planning: Integrated planning should align generation targets with emerging demand drivers-such as e-mobility and industrial decarbonization-while accounting for system flexibility, reliability, and least-cost pathways.
3. Modernize grids and operations: Upgrading transmission, strengthening interconnections, deploying storage, and enhancing ancillary services are essential to integrate variable renewables and ensure stability.
4. Develop robust financing plans: Blended finance, guarantees, and risk-sharing instruments can optimize the cost of capital and crowd in private investment, while carbon markets-where feasible-can provide additional revenue streams.

The jobs story is increasingly compelling. China already employs over four million people in the clean energy sector-more than half of the global total. Viet Nam is projected to gain nearly one million additional jobs by 2040 from the expansion of solar and offshore wind. Indonesia and the Philippines are also poised to see growth across clean manufacturing, construction, and energy services as renewables scale and supply chains deepen.

"Large-scale development and utilization of renewable energy have brought China safer and more affordable energy supply, reduced pollution, stronger economic growth, and millions of new jobs," noted Shen Ruibao, Deputy Director of the Renewable Energy Department at China's National Energy Administration.

Competitiveness, Security, and Affordability

As global value chains increasingly favor low-carbon production, renewables can help anchor East Asia's industrial competitiveness positioning the region in fast-growing clean technology markets. For households, clean power can translate into more stable bills, improved air quality, and better health outcomes.

The transition also strengthens energy security. Diversified renewable portfolios-combined with storage and flexible generation-reduce reliance on imported fuels and cushion economies against global price shocks. In parallel, electrification of transport and industry can improve energy efficiency, lowering overall system costs when paired with effective demand-side management.

Regional Cooperation: A Force Multiplier

No single country can optimize the energy transition in isolation. Strengthening power trade and cross-border interconnections across ASEAN and the broader region can reduce overall system costs, enhance security, and accelerate renewable deployment. The ASEAN Power Grid initiative reflects this logic-pooling resources, balancing variability across geographies, and unlocking least-cost generation.

"We must strengthen interconnections with ASEAN neighbors through initiatives like the ASEAN Power Grid, which will allow efficient cross-border electricity trade and optimize generation across the region," said Chanthanet Boualapha, Vice Minister of Natural Resources and Environment of Lao PDR.

Effective regional integration entails harmonized grid codes, transparent trading frameworks, coordinated investment in transmission corridors, and robust system operations. It also requires collaboration on regional markets for ancillary services and storage, ensuring that variability is managed across borders, not just within them.

From Ambition to Action

The World Bank Group is supporting the region's pivot from ambition to implementation. A US$2.5 billion Multiphase Programmatic Approach (MPA) for the Accelerating Sustainable Energy Transition Program in East Asia and Pacific aims to deliver tangible results: increasing access to clean electricity for 20 million people and supporting the development of 2.5 GW of clean energy. Complementing country programs, the ASEAN Power Grid Financing Initiative-launched with ASEAN and the Asian Development Bank at the ASEAN Business Summit in October 2025-targets regional transmission and integration.

Implementation at scale remains the defining challenge. Moving hundreds of projects from feasibility to construction, synchronizing grid upgrades, building storage, and harmonizing regulatory frameworks across jurisdictions requires sustained focus, policy certainty, and deep pipelines of bankable projects. And the social dimension-skills, just transition support, and community engagement-must be integral, ensuring benefits are widely shared and vulnerable groups are not left behind.