Southeast Asia Thermal Power Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Southeast Asia Thermal Power Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Southeast Asia Thermal Power market is expected to reach an installed capacity of 2,01,074 MW by the end of this year and is projected to register a CAGR of over 2.74% during the forecast period (2022-2027).

The Southeast Thermal Power market was adversely affected by COVID-19 due to disruptions in the supply chain. However, the market rebounded in 2021 and is expected to grow steadily during the forecast period.

Key Highlights

• Over the medium term, the rising power demand and increasing investments in the power industry are expected to drive the Southeast Asian thermal power market. For instance, the electricity demand in the region is likely to continue and increase significantly over the next three decades and is expected to reach 2,690 terawatt-hours (TWh) by 2050. Indonesia, Vietnam, Thailand, and the Philippines are expected to have the highest electricity demand during the study period.
• On the other hand, the rapid growth in the renewable energy sector is expected to be one of the main restraints for the thermal power market in the region.
• Nevertheless, the energy demand in the Southeast Asian region is expected to grow by two-thirds between 2019 and 2040, thereby leading to massive investment in new energy generation and transmission, creating ample market opportunities for thermal power generation.
• Indonesia is one of the largest economies in Southeast Asia, and witnessed the highest power generation in 2021. With upcoming and planned thermal power projects, the nation is expected to dominate the market.

Key Market TrendsCoal-Based Thermal Power Plants to Dominate the Market

• The rising power demand across different nations in Southeast Asia and the affordability of coal for power generation is resulting in the dominance of coal for power generation during the forecast period.
• Indonesia is the leading market for the power sector. Despite its goals to increase the renewable share in electricity generation to 23% by 2025, the electricity generation from the thermal energy, especially coal, is expected to increase due to ongoing and planned capacity expansion plans.
• Countries like Vietnam and Thailand are witnessing a continuous increase in electricity generation from coal. Vietnam reported 52 TWh in 2015 while 114.1 TWh of electricity from coal in 2021.
• According to IEA, the primary energy demand in Southeast Asia in the Stated Policies Scenario by coal is expected to rise to 216 Mtoe in 2030 and 270 Mtoe in 2040.
• Although due to environmental concerns and increasing interests towards natural gas and renewable energy, the growth rate of coal-based thermal plants is decreasing, the already operating plants and few upcoming plants are expected to drive the coal thermal power.

Indonesia to Dominate the Market

• Indonesia, the largest economy in Southeast Asia and the electricity sector of the country, is highly dependent upon fossil fuels for electricity production, on lignite and bituminous coal mainly. Although not the same as coal, natural gas is also expected to remain an integral part of the country's energy mix.
• The country's electricity generation is heavily reliant on fossil fuels, mainly natural gas, followed by coal and oil. InAccording to BP Statistcial Review, in 2021, the Coal had a share of 61.4% in total electricity generation, followed by Natural Gas at 18.2%.
• As of May 2021, the country has had an ongoing program since 2015 of adding around 35 GW of coal-fired power plants to its national grid. Added to 35 GW, there's a parallel program to add 7 GW of coal power project to the grid. The high usage of coal for power generation has been mainly due to the high amount of coal reserves the country has at 34.87 billion tons, the highest in Southeast Asia.
• In October 2021, Mitsubishi Power started commercial operations of a 500-megawatt natural gas turbine in Indonesia's Muara Karang Power Plant Thus, such projects are expected to drive the thermal power market.
• Out of the various sources of generating conventional thermal power, most of the energy came from coal, in 2021. Coal contributed approximately 66% to the conventional thermal power electricity generation, producing 190 terawatt-hours (TWh) of electricity in 2021.
• With increasing power demand, power generation is also growing. Indonesia generated 310 TWh of electricity in 2021. To meet the growing demand, new projects are expected during the forecast period and drive a considerable market.

Competitive Landscape

The Southeast Asia thermal power market is moderately fragmented in nature. Some of the major players in the market (in no particular order) include Electricity Generating Authority of Thailand, Indonesia Power PT, Electric Power Development Co., Ltd, Vietnam Electricity, and Malakoff Corporation Berhad among others.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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