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🌱 Powering Southeast Asia: How Australia and China Can Lead the Green Energy Charge 🌏⚡

Discover how Australia and China, despite strategic rivalry, can jointly lead Southeast Asia’s green energy transition through complementary roles in renewables, electric vehicles, and hydrogen technology.

Author

Green Glow
May 18, 2025

Southeast Asia stands at a pivotal moment in its development trajectory. As one of the world’s fastest-growing regions, its surging energy demand presents both a challenge and an opportunity: how to power growth sustainably. The Association of Southeast Asian Nations (ASEAN) has committed to increasing renewables to 23% of the energy mix by 2025 and is aligning with global efforts to triple renewable capacity by 2030.

Realizing these ambitions will require unprecedented investment and coordination. Two countries—China and Australia—despite their geopolitical tensions, are uniquely positioned to jointly support this transformation. Their complementary strengths in renewable technologies, critical minerals, and regional connectivity place them at the heart of ASEAN’s energy future.

Table of Contents

Complementary Strengths: China and Australia in the Green Energy Landscape

While their political relationship has had its ups and downs, China and Australia bring distinct yet synergistic assets to the table:

  • China is the global leader in renewable energy infrastructure, EV manufacturing, and lithium battery production. Its investments in ASEAN—around US$3 billion from 2019–2023—have already established strong energy ties through initiatives like the Laos–China 500 kV Interconnection Project and hydro grid infrastructure.

  • Australia, on the other hand, holds abundant reserves of lithium, nickel, and other minerals essential for green technologies. It has launched initiatives such as the Aus4ASEAN Futures Initiative, contributed funding to the ASEAN Centre for Energy, and is backing long-range projects like the SunCable Australia–Asia Power Link, which aims to deliver solar energy to Singapore and Indonesia.

This dual role—China as technology leader and Australia as resource supplier—can form the backbone of a collaborative regional strategy.

Electric Vehicles: Driving Sustainable Industrialization

One of the most promising arenas for trilateral cooperation is the electric vehicle (EV) sector. Several ASEAN economies—Indonesia, Thailand, and Malaysia—have ambitious plans to become EV and battery manufacturing hubs. China’s EV giants, such as Contemporary Amperex Technology Co. Ltd. (CATL), are already investing heavily in Indonesia’s nickel supply chain and forming partnerships in Thailand.

Australia, rich in critical minerals like lithium, can support this transition by supplying raw materials and investing in downstream processing facilities across the region. For example, former Indonesian President Joko Widodo emphasized the desire to import Australian lithium to build a fully integrated EV supply chain that leverages Indonesia’s nickel and Australia’s minerals.

This creates a mutually beneficial supply loop—China provides technology, Australia provides materials, and ASEAN provides manufacturing scale.

The Hydrogen Horizon: A New Energy Frontier

Hydrogen, particularly green hydrogen, is another emerging area of collaboration. Australia is developing one of the largest hydrogen project pipelines globally, backed by its renewable energy capacity and export ambitions. China, meanwhile, is advancing rapidly in hydrogen R&D and industrial deployment.

Southeast Asia’s hydrogen demand has already reached over 3 million tonnes per year and is expected to grow. Partnerships between China and Australia, supported by ASEAN’s rising energy needs, can help build a regional hydrogen value chain that fuels industry, transport, and power generation.

Institutional Architecture for a Green Future

Successful collaboration depends not just on investment but also on strong institutional coordination. Encouragingly, several frameworks have emerged:

  • The Australia–China Memorandum of Understanding on Climate Change Cooperation (June 2024)

  • The Melbourne Declaration (March 2024), promoting energy partnership between Australia and ASEAN

  • The ASEAN–China Clean Energy Cooperation Centre

These platforms create formal spaces for policy alignment, capacity-building, and project incubation. They also help depoliticize climate cooperation, turning competition into collaboration.

Beyond Rivalry: Toward a Multilateral Energy Model

While Australia and China may not always see eye-to-eye geopolitically, Southeast Asia’s green energy transition offers a rare opportunity to work together on shared interests. Their complementary roles in EVs, hydrogen, and renewable infrastructure make them ideal partners rather than rivals in the region’s decarbonization journey.

Moreover, their collaboration in ASEAN could serve as a blueprint for energy diplomacy elsewhere—in Africa, South Asia, or Latin America—where clean energy investment is also surging.

Conclusion

The window of opportunity is open. With ASEAN nations charting ambitious climate pathways and the world racing toward net-zero, Australia and China can power more than just regional growth—they can shape a global transition.

By prioritizing cooperation over confrontation, both powers have the chance to lead the charge in Southeast Asia’s green energy revolution, unlocking economic, environmental, and diplomatic dividends for decades to come.

FAQs

Why are Australia and China important to Southeast Asia’s energy transition?

Australia and China possess complementary strengths—China excels in renewable infrastructure and EV technology, while Australia has abundant critical minerals like lithium and nickel. Their collaboration can help ASEAN countries meet their climate and energy goals.

What types of energy projects are involved in this cooperation?

Key initiatives include:

  • China's hydropower and energy grid projects in Laos, Myanmar, and Indonesia.

  • Australia’s SunCable solar export project and clean energy funding via the Aus4ASEAN program.

  • Joint ventures in EV battery production and hydrogen development.

How does this cooperation benefit ASEAN countries?

ASEAN countries benefit from investment, technology transfer, and supply chain integration. These partnerships help build infrastructure, create jobs, and accelerate the shift to clean energy in fast-growing economies like Indonesia, Vietnam, and the Philippines.

Is this partnership politically feasible given tensions between China and Australia?

Yes. While political differences remain, both nations have shown willingness to cooperate on climate and energy. Formal frameworks like the Australia–China Climate Change MoU and ASEAN cooperation centres provide a neutral platform for coordination.

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