The ASEAN member states have a long-standing goal to establish multilateral power trading in the region. To date, regional power trading has largely been limited to a series of uncoordinated bilateral cross-border trade and three member states participating in an initial arrangement to implement power trade.  Multilateral power trading can bring multiple benefits, including reduced system costs, increased energy security and an ability to integrate higher shares of variable renewable energy. An examination of international experiences shows that it is possible to establish multilateral trading while allowing for stepwise and voluntary development and respecting local sovereignty. At the same time, increased cross-border integration and power trade does require increased co-ordination and regulatory harmonisation.

This report identifies a set of minimum political, technical and institutional requirements that the ASEAN member states will need to meet in order to establish multilateral power trading in the region. Some of these minimum requirements can be met by building upon existing efforts in the region. The report also proposes a set of trading arrangements of increasing levels of ambition which, taken together, will enable ASEAN to establish multilateral power trading in a manner that is consistent with maximising national sovereignty and the equitable sharing of benefits.

The recommendations of this report were presented to the 37^th ASEAN Ministers of Energy Meeting (AMEM) in September 2019 in Bangkok.  The 37^th AMEM subsequently tasked its senior officials and the Heads of ASEAN Power Utilities and Authorities (HAPUA) to follow through on the study’s recommendations, including through the ASEAN Plan of Action for Energy Cooperation (APAEC) Phase 2 (2021-2025).

This report was produced in collaboration with the International Energy Agency (IEA) with mandate from ASEAN member states through the HAPUA and the ASEAN Power Grid Consultative Committee (APGCC).