Leading energy firms from Singapore and Malaysia have reached an agreement to explore renewable energy import opportunities from Vietnam. This agreement aligns with Southeast Asian countries’ ambition to develop a regional electricity grid known as a “regional supergrid.” Under this collaboration, Malaysia will be represented by MY Energy Consortium—a joint initiative formed by Tenaga Nasional Berhad (TNB) and Petroliam Nasional Berhad (Petronas). The Malaysian consortium will partner with a Vietnamese group comprising PetroVietnam Technical Services Corporation (PTSC), Petrovietnam Energy Group, and Sembcorp Utilities Pte Ltd, a subsidiary of Singapore’s Sembcorp Industries.

Together, the consortium will examine the potential of renewable energy in Vietnam, focusing particularly on offshore wind power as a source of clean energy for export to neighboring countries. The feasibility of exporting this renewable energy to Singapore and Malaysia through undersea cables will also be assessed. This infrastructure is expected to eventually integrate into the electricity grid in Peninsular Malaysia.

“The consortium will coordinate with the relevant government authorities throughout the project development process, including obtaining the necessary permits at each stage,” stated Sembcorp Industries in a press release on Monday, May 26, 2025.

This agreement coincides with ASEAN countries’ joint objective to link electricity grids across the region. Integrating renewable energy across Southeast Asia is seen as vital to achieving climate goals, especially given rising energy demands driven by artificial intelligence (AI) and data center growth.

A recent report by think tank Ember, titled “From AI to Emissions: Aligning ASEAN's Digital Growth with Energy Transition Goals,” reveals that fossil fuels still dominate the region’s electricity supply, particularly amid the rapid expansion of data centers. Malaysia, which is experiencing the fastest growth in this sector, is projected to see a jump in electricity demand from 8.5 Terawatt-hours (TWh) in 2024 to 68 TWh by 2030. This surge is expected to increase emissions from 5.9 million tons of COâ‚‚e to 40 million tons of COâ‚‚e.

Indonesia ranks second in rising electricity demand linked to data center growth, with consumption expected to climb from 6.7 TWh in 2024 to 26 TWh by 2030. Meanwhile, the Philippines is projected to rise from 1.1 TWh to 20 TWh over the same period, with emissions in the Luzon-Visayas grid increasing from 0.8 MtCOâ‚‚e to 10.5 MtCOâ‚‚e.

“Data center growth is straining ASEAN's power systems, most of which still rely on coal and gas. Accelerating the deployment of renewable energy and upgrading infrastructure through investment and regional cooperation is essential to ensure sustainable growth and advance energy transition,” said Pritesh Swamy, Head of Data Centre Research & Insights Asia Pacific at Cushman & Wakefield.

Despite the challenges, Ember notes that ASEAN still has strong potential to green its data center industry. It estimates that by 2030, at least 30% of data center electricity needs can be supplied by solar and wind energy—even without batteries, which are often seen as a major barrier to clean energy adoption. With the right policy support, ASEAN can power its digital growth without increasing carbon emissions.