Political turmoil in Thailand delays power deal in ASEAN!

Political turmoil in Thailand delays power deal in ASEAN!

Things are now getting exciting in the dynamic world of energy policy: Thailand has delayed the renewal of a multilateral electricity trade agreement, which could have major implications for the ASEAN region. According to Reuters, the reason for the delay is due to the political changes in Thailand. Prime Minister Paetongtarn Shinawatra was ousted in August and his successor Anutin Charnvirakul took office in September. These government uncertainties have resulted in the Lao PDR-Thailand-Malaysia-Singapore (LTMS) project to supply hydropower from Laos via Thailand to Malaysia, now postponed until November.

Malaysia's Energy Minister Fadillah Yusof emphasized the importance of the LTMS project for regional energy cooperation. During a meeting in Kuala Lumpur, he said Malaysia was already committed to participating in the LTMS project. The signing of the contract is scheduled for November, followed by the campaign for the second phase of the project, which is crucial for the energy supply in the region.

A step towards energy integration

The LTMS project is considered a precursor to the ASEAN Power Grid (APG) Initiative and is considered a success story in energy cooperation within ASEAN countries. Fadillah highlighted that the benefits of the project extend beyond the borders of the countries currently involved. The LTMS enables Thailand, Malaysia and soon Singapore to more closely link their energy systems. This integration will represent a significant step forward towards security of supply and sustainability in the region.

The demand for energy in Malaysia will increase in the coming years; An increase of 10% and 8% is forecast for 2026 and 2027, respectively, due to growing industries and new data centers. To meet the challenges of this increasing demand, Malaysia is reducing its use of coal and investing more in renewable energy. This is a step in the right direction, especially in light of the LTMS project, which also enables cross-border energy exports.

Technical and economic feasibility

It is worth noting that the test import of hydroelectric power from Laos to Singapore, which began a year ago, was a great success with 100 MW. As of April 2025, 265.73 GWh of electricity had already been traded, covering about 1.5% of Singapore's peak electricity demand. This development shows that the LTMS-PIP (Lao PDR, Thailand, Malaysia, Singapore – Power Interconnection Project) is not only technically but also economically feasible. This can reveal future cross-border connections and markets that offer new opportunities for the entire region.

Another important topic is binational cooperation between ASEAN member states during peak loads or low power generation. This cooperation is supported by various initiatives, including the ASEAN Memorandum of Understanding on Petroleum Security, which was recently concluded. ASEAN's goal is to ensure the efficiency and availability of energy for all members.

The challenges may be great, but so are the opportunities. With the announced progress in the LTMS, political change in Thailand and support from neighboring countries such as the Philippines, we are on a promising path towards improved energy integration in Southeast Asia. It remains exciting to see how developments will progress here in the coming months.