Eight of the ten ASEAN member states have adopted net zero commitments: Brunei, Cambodia, Laos, Malaysia, Singapore and Vietnam goal net zero emissions by 2050, Indonesia by 2060 and Thailand by 2065. However, the installed capability of coal-fired power plants within the region will still be 121 GW in 2025, while coal consumption is anticipated to say no in ASEAN will increase by 5% in 2026 547 million tons.
There are specific reasons for this trend, and the reply varies from country to country. The three cases below generally illustrate this pattern.
Indonesia: Nickel for electric vehicles, coal for smelting
Indonesia added 1.9 GW of latest coal-fired power generation capability in 2024, the third-largest increase on the planet after China and India. About 80% of this latest capability got here from own power plants for industrial zones processing nickel, cobalt and aluminum.
Indonesia’s owned coal production capability has tripled from 5.5 GW in 2019 to 16.6 GW by the top of 2024, with most of this energy concentrated in nickel industrial parks in Sulawesi and North Maluku. Ironically, much of this demand comes from the worldwide EV battery supply chain.
Indonesia’s national energy development plan for 2024-2060 even envisages adding 26.7 GW of coal-fired power capability over the following seven years, of which 75% are self-owned.
The growing demand for electricity also strengthens the position of coal. According to the Electricity Supply Business Plan 2025-2034 (RUPTL) published by the Ministry of Energy and Mineral Resources in May 2025, even essentially the most ambitious renewable energy acceleration scenario still projects that by 2034 coal will constitute 46.8% of the national electricity mix. Although that is down from the present 64.2%, coal will remain the biggest source of electricity generation.
There are also significant financial constraints. Many recently constructed coal-fired power plants still have outstanding construction debt. It is estimated that unrecovered capital collected across Southeast Asia’s entire coal fleet in 2025 will exceed $130 billion.
This implies that early withdrawal of those plants would lead to direct financial losses for each operators and their financiers.
Vietnam: No latest coal, but old projects proceed
Vietnam presents a special case. Under the eighth Energy Development Plan (PDP8), the country pledged to not approve any latest coal-fired energy projects after 2030.
Coal plants which were operating for 20 years are expected to be converted to biomass or ammonia, while those which were operating for greater than 40 years and can’t be converted shall be phased out. By 2050, all coal-fired power generation capability is anticipated to be converted or shut down.
Projects that entered construction before the adoption of PDP8 in 2023 are currently being implemented.
One example is Vung Ang II, a 1.32 GW power plant in Ha Tinh, which opened in April 2026. The project was developed by a consortium of Mitsubishi Corporation (60%) and KEPCO (40%) under a $2.2 billion build-operate-transfer program, and construction will begin in 2021.
Under the PDP8 framework, fuel conversion on the plant is anticipated to start around 2046, roughly twenty years sooner than the traditional economic lifetime of a coal-fired power plant.
At the identical time, Vietnam stays highly depending on coal to satisfy its rapidly growing electricity demand. As of October 2024, coal still accounted for 48.7% of the country’s total electricity generation, and over 10 GW of latest coal-fired generation capability stays within the PDP8 pipeline.
This demand pressure is nothing latest. Vietnam’s electricity consumption has increased eightfold over the past twenty years, with coal meeting many of the additional demand. Thanks to this sustained growth, Vietnam is anticipated to turn out to be the world’s fifth-largest coal importer by 2025, making it considered one of the most recent countries to enter the rating.
Philippines: Moratorium with loopholes
In October 2020, the Philippines imposed a moratorium on latest greenfield coal-fired power plants. However, the moratorium doesn’t apply retroactively. Projects that were already classified as committed before 2020 were allowed to proceed, and the Department of Energy has repeatedly clarified that the policy doesn’t mean a complete ban on coal.
Several firms have also taken advantage of the choice to “spread” existing coal-fired power plants, allowing them to extend capability without technically violating the moratorium. One such case was even reported to the Ombudsman in 2024.
As a result, coal still accounted for 62% of the Philippines’ energy mix in 2024, far exceeding the federal government’s goal of 35% renewable energy by 2030.
Behind these numbers lies an often neglected reality. Per capita electricity consumption within the Philippines stays well below the ASEAN-5 average. In 2024, this amounted to roughly 1,045 kWh per person in comparison with 5,474 kWh in Malaysia and a couple of,653 kWh in Thailand.
With peak electricity demand expected to grow by 5.3% annually through 2028, existing coal-fired power plants remain a key source of supply because the grid is just not yet prepared to accommodate much greater amounts of renewable energy within the near future.
Structural barriers hindering the exit from coal
Beyond individual country cases, there’s a structural challenge that affects much of Southeast Asia: the region’s coal fleet remains to be too young to be easily phased out.
The average coal-fired power plant in Southeast Asia is simply about 13-14 years old. Early withdrawal of those facilities from use is just not only a political decision. This involves outstanding construction debt, long-term contracts with investors, and the prices of replacing existing generation capability with cleaner alternatives.
The cost of retiring Southeast Asia’s entire coal fleet before the top of its life is estimated at $277 billion, representing about 13% of the region’s total GDP in 2022. These estimates are based on minimum end-of-life costs of $1.9 billion per GW, based on GEM, IMF and World Bank data.
Barriers to the event of unpolluted energy are equally essential. The cost of capital for clean energy projects in Southeast Asia is now at the very least twice as high as in advanced economies or China.
However, there are also signs of change on the regional level. About 12 GW of coal-fired power capability was canceled in Southeast Asia in 2024, and Indonesia was the one country within the region to submit proposals for brand new coal-fired power plants this 12 months.
ASEAN also adopted a regional energy plan for 2026–2030, which assumes a 30% share of renewable energy in the first energy basket.
However, so long as existing debts remain unpaid, existing project plans are still under development, and renewable energy capability is insufficient to switch baseload generation, net-zero commitments and latest coal-fired power plants will likely proceed to co-exist.
