Asean could avoid $2.3bn in economic losses by 2040 with smart grids, according to a report from energy think tank Ember.

The report shows that investments of between $4bn and $10.7bn in smart grid infrastructure are needed to modernise the region’s networks.

At the lower end of the range, around $4bn investment would deliver essential upgrades such as smart meters and automated controls, laying the foundation for more reliable and resilient grids. At the upper end, $10.7bn would enable a fully optimised, future-ready system, unlocking the region’s full clean energy potential through digitalisation, storage and cross-border interconnection.

Much of the investment needs lie in large and fast-growing economies such as Indonesia, Vietnam and Philippines, where outages impose the highest costs. Meanwhile, Singapore and Malaysia are already advancing digital grid strategies, showing what can be achieved with early action. This diversity underscores both the scale of the challenge and the opportunity for knowledge-sharing across Asean.

The report highlights Asean’s progress to date, including a 60% reduction in outage duration and frequency between 2015 and 2020. Yet it stresses that scaling up smart grids remains constrained by financing gaps, fragmented standards and uneven national commitments.

Many Asean power systems still face rigid demand patterns and limited use of tools such as smart devices or time-of-use tariffs, hindering the integration of a higher share of renewables. Smart grids embed digital intelligence, including sensors, automation and forecasting that allow real-time balancing of supply and demand.

Unlike transitional upgrades that simply add capacity, smart grids link generation, transmission, distribution and consumption through digital tools. This unlocks efficiency, resilience and the ability to scale up renewables.

Momentum is already building. Singapore, Malaysia, Thailand, Philippines, Indonesia and Vietnam have each launched smart grids strategies and pilots, from smart metering and demand response to curtailment reduction and cyber-security integration, sending signals that digitalisation and clean energy integration are moving into the mainstream.

With the right investment, smart grids can stabilise supply, accelerate Asean’s clean energy transition, and strengthen economic resilience. Modern networks will ensure fast-growing solar and wind power are fully used, turning risks into opportunities for growth and competitiveness in the low-carbon economy.

The benefits would extend far beyond avoided losses. Smart grid deployment could generate 243,000 to 649,000 jobs, spanning engineering, construction, IT and long-term operations. More reliable power would reduce dependence on diesel backup generators, cut household costs and improve public health through cleaner air.

To scale up smart grid development, Asean governments can harmonise standards, mobilise finance, and draw on peer experiences by linking national efforts with regional coordination.

“Smart grids are an essential tool for meeting growing energy demands as well as managing increasingly complex energy systems in Asean and the wider Asia-Pacific region,” said Carlos Kuriyama, director of the policy support unit at Apec Secretariat (www.apec.org/about-us/apec-secretariat). “They offer opportunities in reducing waste and pollution while maximising the efficient use of energy infrastructure. Regional cooperation will be an essential tool for realising the full potential of smart grids.”

More on the report can be found at ember-energy.org/latest-insights/aseans-low-carbon-future-flows-through-smart-grids/.