Geothermal Leaders Press ASEAN To Unlock 35 GW Energy Potential

Geothermal industry leaders are pushing for stronger public-private risk-sharing mechanisms, streamlined regulations, and expanded transmission infrastructure to unlock up to 35,000 megawatts (MW) of geothermal potential across Southeast Asia.

The call was made at the ASEAN Energy Business Forum in Manila on Monday, as industry groups and developers pointed to high exploration costs, regulatory hurdles and inadequate power infrastructure as major barriers to wider geothermal deployment in the region.

Jaime Jemuel Austria, president of the National Geothermal Association of the Philippines (NGAP), said governments should adopt de-risking measures similar to the Philippine Geothermal De-risking Facility to reduce the financial burden of exploratory drilling.

“Drilling does not always find what geologists hope it would due to subsurface uncertainties,” Austria said.

ASEAN countries have an estimated 34 to 35 gigawatts (GW) of geothermal potential, equivalent to nearly 48% of the global resource. Yet current regional production is only about 4,000 MW, leaving much of the resource untapped.

Indonesia dominates Southeast Asia’s geothermal sector, accounting for about 84.9% of regional capacity, while the Philippines contributes about 12.7%. Both countries are established producers, but interest in geothermal exploration is also expanding in Thailand, Vietnam, Malaysia, Laos and Myanmar.

Reducing Exploration Risks

Industry officials said the economics of geothermal development make it difficult for projects to compete with renewable technologies that can be deployed more quickly and with less upfront uncertainty.

First Gen Corp., through its renewable energy arm Energy Development Corp. (EDC), has called for stronger policy and financial support to address those risks.

“Because geothermal [energy] bears heavy upfront subsurface drilling risks before revenue generation begins, unsupportive policy environments often render projects unbankable compared to cheaper, faster-to-deploy variable alternatives,” the company said.

Unlike solar and wind projects, geothermal developments require significant investment before the commercial viability of an underground resource can be established. An unsuccessful exploratory well can leave developers with substantial costs without generating revenue.

The Philippine government has begun accepting applications from developers seeking initial investments under a ₱10.7-billion geothermal de-risking facility. Under the mechanism, the government shoulders half of eligible drilling costs, with the financing converted into a grant if exploration fails to establish a viable resource.

Austria also cited the $170-million Philippine Geothermal De-risking Facility as an example of efforts to absorb some of the risks associated with early-stage exploration.

Infrastructure And Regulation

Industry leaders also said geothermal expansion would require improvements in permitting and electricity infrastructure.

Austria called for streamlined, single-window permitting processes to shorten project development timelines. He also emphasized the need to prioritize grid connections so new geothermal facilities can deliver electricity to consumers.

First Gen also pointed to the lack of subsea cables and high-voltage transmission backbones as constraints, particularly for geothermal plants located far from major demand centers.

These infrastructure gaps could become more significant if geothermal resources in emerging markets are developed as part of broader regional energy cooperation.

The sector also faces challenges from existing facilities. Austria said some of the Philippines’ pioneer geothermal plants, built in the late 1970s and 1980s, are experiencing declining performance and require retrofits or replacement.

The Philippines currently has about 2,057 MW of installed geothermal capacity, making it the world’s third-largest geothermal power producer and Southeast Asia’s second-largest producer.

ASEAN industry leaders said expanding geothermal could provide a stable source of renewable electricity that complements variable sources such as solar and wind.

With nearly half of the world’s geothermal resource potential concentrated in ASEAN, they said reducing exploration risks and addressing policy and infrastructure constraints would be critical to turning the region’s large underground resource base into additional generating capacity.

Source:

https://mb.com.ph/2026/10/05/southeast-asias-geothermal-rush-hits-wall-on-deep-drilling-risk

https://business.inquirer.net/614391/first-gen-seeks-firmer-derisking-policies-in-southeast-asia

https://bilyonaryo.com/philippines-geothermal-edge-under-pressure-from-costly-drilling-aging-plants/