Demand for energy & energy market integration in Asean

Abstract

This study examines how countries in the ASEAN Power Grid (APG) respond to a change in marginal transmission losses incurred from power trading, and which interconnection project Singapore should prioritise and pursue. Using a dynamic linear programming model, this study simulates open energy trading scenarios with locational marginal pricing of transmission losses from 2016-2037. Our results shows three main findings in a 50% open power trade regime amongst ASEAN nations. First, introducing locational marginal pricing of transmission losses in an open trade scenario reduces trade for developed ASEAN countries. Second, the reduced trade affects the ability of the region to tap on renewable energy resources. Third, Singapore should prioritise and pursue the interconnection project with Batam, Indonesia.