Southeast Asia could save approximately US$45.4 billion by installing enough solar photovoltaic capacity to generate the same amount of electricity as planned gas power projects across five major economies, according to research group Zero Carbon Analytics (ZCA).
Nearly 49 gigawatts (GW) of gas capacity is in pre-construction or construction across Indonesia, Malaysia, Thailand, the Philippines and Vietnam, according to ZCA’s analysis of Global Energy Monitor data. If completed, the projects could generate around 263 terawatt-hour (TWh) of electricity annually.
Vietnam accounts for the largest planned expansion, at approximately 34.5 GW, followed by Malaysia at 9.6 GW. These additions would increase their gas capacity by 380 per cent and 53 per cent, respectively, compared with 2025 levels.
Solar electricity was already cheaper than gas across all five countries in 2025, according to ZCA’s analysis of BloombergNEF and International Energy Agency data. On average, solar generation costs were 50 per cent lower than gas, with the difference projected to widen to 84 per cent by 2030.
The comparison uses the levelised cost of electricity, a measure of average generation costs over a project’s lifetime. It does not represent the retail electricity tariff paid by consumers.
Image: Zero Carbon Analytics
In the Philippines, the cited 2025 figures put solar generation costs at US$54 per megawatt-hour, compared with US$99 for gas, making solar electricity 45 per cent cheaper. ZCA projected that solar electricity could be 86 per cent cheaper than gas by 2030.
Wind power is also becoming more competitive. Its generation costs are currently comparable with gas in Indonesia, while onshore wind is projected to undercut gas in Indonesia, Vietnam and the Philippines by 2030.
The findings highlight the financial risks of expanding gas infrastructure as renewable generation becomes cheaper. ZCA warned that the economic case for policymakers to choose renewables is growing stronger, while current gas plans risk locking countries into fossil fuel infrastructure.
Corporates bet on clean power
As costs fall, companies are turning toward renewables, with some of Southeast Asia’s biggest electricity consumers signing clean power agreements to support their operations, including expanding data centres, said the ZCA report.
Microsoft Indonesia signed a 10-year agreement with state utility PT PLN to procure 200 megawatts (MW) of renewable power, including 100 MW of solar. Google secured one terawatt-hour of solar electricity over 21 years for its Malaysian data centres, while Samsung Electronics signed Vietnam’s first grid-based direct power purchase agreement to procure 70 gigawatt-hours of solar electricity annually.
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Businesses are increasingly choosing renewable electricity, showing that business leaders recognise the economic and energy security benefits of the clean energy transition, even as major Asean governments continue to plan tens of gigawatts of new gas.
Yu Sun Chin, senior Asia regional researcher, Zero Carbon Analytics
Policy changes are widening access to renewable electricity. Vietnam expanded its direct power purchase framework in 2026 to include data centres and electric vehicle charging stations.
Malaysia introduced a scheme in 2024 allowing renewable energy producers to supply corporate buyers through the national grid, while Thailand approved a 2,000 MW direct power purchase pilot aimed particularly at data centre investors.
The Philippines also lowered its Retail Competition and Open Access demand threshold to 100 kilowatts, expanding electricity supplier choice for smaller consumers.
“Energy policy has yet to catch up to where the market is going. Businesses are increasingly choosing renewable electricity, showing that business leaders recognise the economic and energy security benefits of the clean energy transition, even as major Asean governments continue to plan tens of gigawatts of new gas,” said Yu Sun Chin, senior Asia regional researcher at Zero Carbon Analytics.
She urged governments to prioritise renewable energy in their power development plans rather than commit to new gas infrastructure.
“The economic case for gas is becoming harder to justify as projects face volatile fuel prices and rising costs, while renewable power continues to become more competitive,” she said.
