Recent Developments in Energy Transition and Innovation in the Asia-Pacific Region
13 minute read | April.01.2026
The Asia-Pacific region continues to accelerate its energy transition, with governments and industry leaders rolling out new policies, launching innovative projects, and updating regulations to foster sustainability, attract investment and drive economic growth.
Here’s a roundup of the latest developments from key markets in the region:
Singapore: New Solar Target and New Decarbonisation Challenge
India: Reforms to External Commercial Borrowings and a Regulatory Framework for VPPAs
Thailand: Country’s First Comprehensive Climate Change Law Approved
Dispute Resolution: Force Majeure in Oil and Gas Contracts Due to Armed Conflict in the Persian Gulf
On 2 March 2026, Singapore’s Energy Market Authority (EMA) announced an increase in the island nation’s national solar deployment target, to 3 GWp by 2030. This follows Singapore’s achievement of 2 GWp of installed solar capacity in 2025. This higher capacity is expected to generate enough clean power for approximately half a million households annually, marking a meaningful step in Singapore’s transition towards cleaner energy sources.
To reach this goal, the Singapore government intends to maximise solar installations on available rooftops, land and water spaces. The government is also exploring novel deployment methods, such as overhang solar that could serve as shelters and canopies at open-air car parks. Along with the anticipated acceleration of government-led deployment programmes such as SolarNova and SolarRoof, this increased target is likely to generate fresh opportunities for solar developers, EPC contractors and project investors across the value chain.
However, even with the increased target, solar is projected to realistically contribute around 10% of Singapore’s projected energy needs by 2050. This reinforces the need for a broader supply mix that includes cross-border low-carbon electricity imports, biomethane and hydrogen.
On 2 March 2026, Minister-in-charge of Energy and Science and Technology Tan See Leng unveiled the launch of the Decarbonisation Research, Innovation and Enterprise Grand Challenge (DGC), a new initiative under Singapore's national RIE2030 plan.
Through the DGC, the Singapore government will invest S$800 million over the next five years to advance research, innovation and commercialisation in low-carbon energy generation and industrial decarbonisation technologies. Priority technology areas include solar, hydrogen and derivative fuels, energy efficiency, energy storage, carbon capture and utilisation, and grid modernisation.
Under the DGC, the Singapore government will also launch the Singapore Pilots for Energy and Enterprise Decarbonisation programme, managed by the Agency for Science, Technology and Research. This programme is designed to connect facility owners, investors, solution providers and government bodies to test and scale emerging clean energy solutions towards commercial deployment.
The DGC represents a significant increase in public funding for Singapore’s energy transition and is expected to stimulate substantial private sector investment and capital flows across the broader clean energy ecosystem.
In late December 2025, the Energy Commission of Malaysia rolled out several regulatory changes to key green electricity frameworks governing renewable energy deployment and consumption in Peninsular Malaysia.
Most notably, the Energy Commission issued guidelines for the Solar Accelerated Transition Action Programme (Solar ATAP), effective 1 January 2026, which replaces the previous Net Energy Metering scheme that ended on 30 June 2025. Under the Solar ATAP:
The Energy Commission also published the third edition of the Guidelines for the Corporate Renewable Energy Supply Scheme on 29 December 2025. This latest edition introduced several notable changes, including:
Together, these reforms underscore Malaysia’s ongoing shift toward market-driven, private sector-led decarbonisation, and are expected to help spur further renewable energy investment and deployment activity.
Indonesia introduced the Minister of Energy and Mineral Resources Regulation No. 19 of 2025 on Hybrid Power Plants in late December 2025 (MEMR 19/2025), which establishes a dedicated regulatory framework for the development of hybrid generation facilities within small-scaled systems.
This regulation forms part of the government’s broader effort to accelerate the transition toward cleaner energy while improving electricity reliability in remote and islanded grids. In particular, it supports Indonesia’s ongoing program to reduce dependence on diesel-fired generation in isolated power systems.
A couple of notable points:
Indonesia enacted the Minister of Energy and Mineral Resources Regulation No. 1 of 2026 on Energy Conservation Service Businesses (MEMR 1/2026), which establishes a regulatory framework for businesses providing energy conservation and energy management services.
This regulation implements aspects of Government Regulation No. 33 of 2023 on Energy Conservation and forms part of the government’s broader efforts to promote energy efficiency and reduce energy intensity across key sectors of the economy. By clarifying the scope of permitted activities and introducing requirements for the registration and reporting of service providers, the regulation aims to support the development of a more structured market for energy conservation services in Indonesia.
Under the MEMR 1/2026, energy conservation service businesses may undertake a range of activities aimed at improving energy efficiency, including conducting energy audits, designing and implementing energy-saving measures, and assisting users in managing and monitoring their energy consumption.
Improving energy efficiency in buildings, industrial facilities and other major energy consumers is expected to play a role in achieving national energy policy objectives and supporting emissions reduction targets.
Indonesia enacted the Regulation of the Minister of Cooperatives No. 12 of 2025 on the Implementation of Mineral and Coal Mining Business Activities by Cooperatives (Permen Kop 12/2025), which sets out procedures for cooperatives to obtain Mining Business License Areas (Wilayah Izin Usaha Pertambangan or WIUP) for metal minerals and coal through a new priority granting mechanism.
Permen Kop 12/2025 implements Government Regulation No. 39 of 2025 (GR 39/2025), which is the second amendment to Government Regulation No. 96 of 2021 on the Implementation of Mineral and Coal Mining Business Activities.
GR 39/2025 implements Law No. 2 of 2025 , which further amends Indonesia's mining law to allow cooperatives, small and medium-scale enterprises, business entities owned by religious organisations, and entities engaged in downstream activities to bypass the standard WIUP auction process. Law No. 2 of 2025 and GR 39/2025 also impose stricter domestic supply obligations on Mining Business License (Izin Usaha Pertambangan or IUP) holders, restrict the use of subsidiaries and affiliates for mining services, and require governors to prepare community development blueprints for mining areas.
Permen Kop 12/2025, GR 39/2025, and Law No. 2 of 2025 sit within a broader wave of reform in the mining sector. Permen Kop 12/2025 further establishes an ongoing support framework for cooperatives in mining, covering legal assistance, access to financing and technology support. These reforms signal a clear policy intent to broaden access to mineral and coal resources beyond traditional mining companies, while maintaining coordinated regulatory oversight across multiple ministries.
Indonesia is signalling a shift in its coal production policy as the government moves to tighten output approvals for 2026 – after several years of record production levels, reaching close to 790 million tonnes in 2025, the Minister of Energy and Mineral Resources has indicated that approved production volumes may be reduced to around 600 million tonnes. The adjustment will largely be implemented through the annual mining work plan approval process (RKAB), under which producers receive government-approved quotas for the following year.
The policy is also being discussed alongside potential adjustments to Indonesia’s Domestic Market Obligation (DMO) requirements, which require coal miners to allocate a portion of output for domestic consumption, particularly for PLN’s coal-fired power plants.
While details of the quota reductions are still evolving, the policy could have significant implications for both the mining sector and the broader energy market. Industry reports indicate that quota reductions may vary significantly across producers.
The shift also comes at a time when Indonesia is balancing competing priorities, maintaining coal’s role in supporting energy security and export revenues, while gradually advancing its longer-term energy transition objectives.
On 28 February 2026, the Ministry of Industry and Trade (MOIT) issued Decision No. 363/QĐ-BCT (Decision 363) to adjust Vietnam’s National Energy Master Plan for the period 2021–2030, with a vision to 2050. Decision 363 revises the original National Energy Master Plan approved under Decision No. 893/QĐ-TTg in July 2023 (NEMP), introducing several changes to Vietnam's energy targets and policy direction.
Most significantly, the revised plan raises the target for the share of renewable energy in total primary energy from the original 15–20% by 2030 under the NEMP to 25–30% by 2030, while slightly adjusting the 2050 target from 80–85% to 70–80%. Final energy consumption projections have also been revised upwards from 107 million tonnes of oil equivalent (toe) to 120–130 million toe by 2030, reflecting Vietnam's accelerating economic growth with the plan now assuming a minimum average GDP growth requirement of 10% per year during 2026–2030. On energy security, the strategic petroleum reserves target has been brought forward and increased from 75–80 days of net imports by 2030 (with a gradual increase to 90 days after 2050) under the NEMP to approximately 90 days of net imports by 2030 under Decision 363.
Decision 363 also introduces a stronger emphasis on developing a competitive energy market, with a roadmap to accelerate the elimination of subsidies in the energy sector and an express objective that social policies will no longer be implemented through energy prices. This is a notable departure from the NEMP's more general language on market development and is intended to create a more transparent investment environment. Other targets, such as hydrogen production capacity of 100,000–200,000 tonnes per year by 2030 (scaling to 10–20 million tonnes per year by 2050) and energy savings of 8–10% by 2030, remain broadly consistent with the NEMP.
On 19 January 2026, the Government of Vietnam issued Decree No. 29/2026/NĐ-CP (Decree 29), establishing the country's first operational framework for a centralised domestic carbon exchange. Decree 29 regulates the registration, coding, ownership transfer, custody, trading and settlement of greenhouse gas emission quotas and eligible carbon credits. The market structure places the Ministry of Agriculture and Environment in charge of the national registry, the Hanoi Stock Exchange as operator of the trading system and the Vietnam Securities Depository and Clearing Corporation as operator of the depository and settlement system.
Decree 29 took effect immediately upon issuance, with a pilot phase running through 31 December 2028 (during which no exchange services fee will be charged), ahead of full commercialisation from 1 January 2029. This development builds on the broader framework established under Decree No. 06/2022/NĐ-CP (as amended by Decree No. 119/2025/NĐ-CP) and fulfils Vietnam's COP26 pledge to reach net-zero emissions by 2050.
The MOIT issued Circular No. 62/2025/TT-BCT (Circular 62), dated 10 December 2025, which took effect on 26 January 2026, establishing Vietnam's first methodology for determining pricing for standalone Battery Energy Storage Systems (BESS) and setting out the main required contents of their power purchase agreements (PPAs). Circular 62 applies to standalone BESS projects connected to the national grid at 110 kV and above with at least 10 MW of capacity, consistent with Power Development Plan 8 (PDP8), but does not apply to BESS co-located with renewable power plants or to systems invested in by EVN power corporations.
The Circular introduces a two-component pricing model comprising:
This approach aims to improve the bankability of standalone BESS projects by reducing uncertainty for potential investors. Vietnam is one of the first major ASEAN economies to adopt a formal two-part tariff structure for BESS, representing meaningful progress towards implementing PDP8's ambitious targets for battery storage capacity of 10,000–16,300 MW by 2030. That said, further important detailed guidance, such as developer selection processes and applicable ceiling tariffs, remains to be addressed in subsequent implementing regulations before projects can move forward with more confidence.
Circular 62 should be seen alongside earlier regulations which encourage the use of BESS with renewable energy in Vietnam. Pursuant to Decision No. 988/QĐ-BCT issued from 10 April 2025, renewable energy projects incorporating storage are entitled to a 10%–15% price premium over non-storage projects in order to encourage grid stability. The policy reflects the broader objective, as articulated in Vietnam's new Electricity Law, of using storage to manage overgeneration and increase the supply of dispatchable, consistent power to the grid.
On 16 February 2026, the Reserve Bank of India (RBI) published sweeping reforms to India's External Commercial Borrowings (ECB) regime (the Amended Regulations), with immediate effect for all new borrowings. The changes mark a comprehensive restructuring of the rules governing cross-border debt in India by:
Notably, the RBI has stripped all ECB-specific provisions from the former master directions without issuing any replacement guidance, leaving the Amended Regulations as the sole governing instrument for ECBs at present.
Several of the reforms stand out as particularly consequential:
These changes are likely to reshape offshore lending dynamics into India. In particular:
That said, certain gaps persist – for example, minority stake acquisitions remain outside the scope of permissible ECB end-uses. However, the overall direction of the reforms signals a clear move towards a more market-oriented and internationally competitive borrowing framework.
On 24 December 2025, the Central Electricity Regulatory Commission of India (CERC) published its Guidelines for Virtual Power Purchase Agreements (VPPA Guidelines), establishing a regulatory framework for VPPAs in India. The new framework aims to address challenges facing the commercial and industrial sector, where renewable energy penetration remains low due to inconsistent state policies, regulatory hurdles in open access, and the intermittency of solar and wind resources.
Under the new VPPA Guidelines:
Notably:
While the VPPA Guidelines are a big step towards the increasing renewable energy penetration in India, there nevertheless are some key gaps that may continue to present hurdles to players in the market, including:
The publishing of a model VPPA or key illustrative clauses to promote standardisation in the future may help to improve the bankability of such VPPA-backed projects.
On 26 February 2026, the Department of Energy (DOE) issued a new Circular No. DC2026-02-0008, requiring all variable renewable energy projects such as wind and solar projects with an installed capacity of at least 10 MW to install energy storage systems (ESS) capturing at least 20% of the plant’s capacity. Projects are also encouraged to include grid-support capabilities such as grid-forming inverters to stabilise voltage and frequency.
This follows the passing of House Bill 6676, also known as the Energy Storage Systems Act (ESS Act), by the House of Representatives on 4 February 2026. Notably, the ESS Act would introduce:
This requirement is expected to drive growth in ESS-coupled utility-scale renewables projects in the Philippines. Prospective developers and financiers of renewable energy projects in the Philippines should take ESS coupling into account when building revenue models, as well as ESS Act developments.
The ESS Act still requires approval from the Senate before being signed into law by the president.
On 2 December 2025, Thailand's Cabinet approved in principle the Draft Climate Change Act (the Draft Act), as proposed by the Ministry of Natural Resources and Environment. This marks a landmark development in Thailand’s climate governance, establishing the country’s first comprehensive master law on climate change.
The Draft Act is designed to support Thailand’s commitments under the United Nations Framework Convention on Climate Change, including its goals of achieving carbon neutrality by 2050 and net-zero greenhouse gas emissions by 2065.
The Draft Act introduces a broad framework for managing Thailand’s greenhouse gas system. Highlights include:
Several additional procedural steps are required before the Draft Act will come into force, including the drafting of subordinate legislation and consultations with relevant agencies on carbon taxation, ETS and CBAM. Enactment is anticipated to be early 2027.
Once enacted, the legislation is expected to have a broad impact on importers, operators and carbon market participants across Thailand, by effectively transforming environmental responsibility into a direct financial and regulatory obligation. Businesses operating in or trading with Thailand should take measures to begin assessing their compliance readiness and monitor further updates in anticipation of this transformative framework.
Taiwan is preparing to launch Round 3.3 of its offshore wind auction series, with authorities expected to release around 3.6 GW of new capacity as the government continues to expand the island’s renewable energy sector. The Ministry of Economic Affairs is currently consulting developers and supply-chain stakeholders on a draft set of framework rules before formally launching the tender later this year. In addition to the 3.6 GW being offered, officials are also considering how to handle additional capacity which has become available due to project cancellations and abandonment from previous auction rounds.
The draft rules suggest several structural changes designed to improve project viability and investor confidence in Taiwan’s offshore wind market, as compared to previous auction rounds. Under Round 3.3, projects are expected to come online around 2030–2031, with individual project sizes likely capped at 1GW (as compared to up to 600 MW previously). The framework may also introduce a price floor linked to Taipower’s avoided-cost benchmark in order to avoid a zero price auction (as was seen previously), as well as include a reduced emphasis on strict local-content requirements. These changes are aimed at stabilising revenues, reducing the risk associated with zero tariff pricing, and controlling project costs.
The armed conflict involving Iran, neighbouring Gulf states, the United States and Israel, beginning 28 February 2026, has triggered widespread oil and gas supply chain disruptions, which are likely to worsen in the short term. The market impact has been severe:
Force majeure claims are cascading through global energy supply chains following Gulf infrastructure attacks and blockades of key shipping routes (and the withdrawal of price effective insurance cover). Companies should expect claims even from counterparties with no direct Gulf exposure. Parties far from the conflict zone, including those in Asia Pacific, may face legitimate, or potentially pretextual, force majeure claims in circumstances where contract and project economics have been suddenly changed.
While most oil and gas contracts enumerate war as a force majeure event, the mere existence of armed conflict does not automatically trigger protections. The invoking party must demonstrate a direct causal link between the conflict and its inability to perform, not merely that performance has become more (or prohibitively) expensive. Given longstanding geopolitical tensions in the Persian Gulf, buyers may seek to argue that conflict was reasonably foreseeable. Sellers should be prepared to demonstrate that the specific nature, scope or timing of the conflict was unforeseeable, or that their contracts do not include a foreseeability requirement. Contractual notice requirements, which are typically strictly enforced, should also be considered.
Most common law jurisdictions draw a sharp distinction between impossibility/frustration and economic hardship (although those with civil law governed contracts may face claims of hardship or economic unfairness). A party that suffers losses but can still perform generally cannot claim force majeure relief. Nevertheless, parties may attempt to characterise price increases as triggering enumerated events such as "government action" (e.g., fuel rationing) or catch-all provisions covering events "beyond reasonable control."
Even where force majeure is established, most clauses impose mitigation obligations. Whether a seller must procure supply on the spot market depends on whether the contract designates a specific source. In single-source contracts, force majeure relief may be available if the named facility becomes unavailable. In open-source contracts, sellers may be unable to claim force majeure simply because their preferred source was disrupted if alternative (though costly) sources remain available.
Energy companies should conduct a comprehensive review of their contractual portfolios within the next 30 days to identify force majeure exposure, assess the validity of any declarations received, and prepare response strategies. Given the pace of developments and the potential for additional cascading claims, prompt action is essential. Read more about force majeure risks for oil and gas companies here.