Kuala Lumpur: The Asian Development Bank (ADB) and the World Bank will jointly launch the ASEAN Power Grid (APG) Finance Facility Framework at the ASEAN Summit with Dialogue Partners in late October, marking a significant move towards advancing regional energy integration.
According to BERNAMA News Agency, ASEAN Deputy Secretary-General for ASEAN Economic Community (AEC) Satvinder Singh stated that the facility aims to support the development and deployment of cross-border energy infrastructure under the APG initiative. Singh indicated that there will be a major announcement regarding the APG Finance Facility Framework during the 47th ASEAN Summit scheduled for October.
In this framework, the focus will be on providing more funding for member states to implement energy projects. During a pre-event briefing on the AEC Strategic Plan 2026-2030, Singh detailed that the framework will not only offer financing but also capacity-building support, including grants, free feasibility studies, and financing facilities.
The framework will also introduce improved loan terms, such as moratoriums for qualifying projects and protection against political uncertainties, to expedite cross-border electricity projects under the APG. Many of these projects have faced delays due to financing and investment risks.
Singh emphasized the positive momentum this initiative will bring during Malaysia's chairmanship year. He also noted that the scope of the APG has expanded beyond the original 18 land-based connector projects, now incorporating subsea transmission lines and national grid upgrades. These enhancements will support renewable energy integration and improve cross-border interoperability, facilitating smoother energy flows and bolstering the region's energy resilience.
The APG, initiated in 1997, aims to interconnect electricity infrastructure among the bloc's 10 member countries, with a target of achieving fully integrated grid operation by 2045. ASEAN Secretary-General Dr. Kao Kim Hourn highlighted that the APG vision requires an estimated investment of US$764 billion for power generation and transmission infrastructure.
Last month, ADB president Masato Kanda announced the bank's readiness to commit US$10 billion towards the APG to expedite cross-border connections, national grid projects, and renewable energy initiatives, all of which will facilitate power trade. ADB has programmed US$27 billion in financing over the next three years to support ASEAN members' priorities, including economic growth, competitiveness, human capital enhancement, and resilience strengthening.
Meanwhile, the ASEAN Centre for Energy (ACE) reported that last September, the World Bank approved US$5 million in technical assistance funding to support the APG.