CSCAP MEMORANDUM NO. 28

Energy Security in the Asia Pacific Region

A Memorandum from theCouncil for Security Cooperation in the Asia Pacific (CSCAP)
June 2016

Council for Security Cooperation in the Asia Pacific (CSCAP)
Memorandum No. 28
Energy Security in the Asia Pacific Region
June 2016
I. Introduction
The perpetuation of the Asia-Pacific’s tremendous economic growth is contingent
primarily on the price of economic inputs, most of all energy. Asia-Pacificcountries are consuming increasingly vast amounts of energy every year.
According to the United Nations Economic and Social Commission for Asia andthe Pacific (UNESCAP), the Asia-Pacific region accounted for 47.3 percent of
global Total Primary Energy Supply (TPES) in 2015. Due to the region’s lack ofsufficient primary energy sources – having only 2.5 percent of global oil reserves
and 8.2 percent of global natural gas reserves – Asia’s energy needs are met
with imported supplies. The region must diversify the sources of its energy
supply.
Cooperation between states at a regional and sub-regional level is necessary toensure a future of sustainable energy security. There is also a need for states toimplement legislation at the national level to incentivise both a move towards low
carbon energy sources and regional cooperation. Institutions such as ASEAN
can play a central role in moving the region towards more cooperative andsustainable approaches to the energy mix.
This CSCAP Memorandum addresses regional energy security and the energy
mix. In addition to specific aspects of the energy mix, it addresses theconsequences of regional energy choices and presents future scenarios forregional energy security as well as tangible policy options to move the region
towards greater cooperation in the energy mix.
II. General Findings
 Energy security is a complex dilemma and cannot be achieved by justattaining energy independence. Energy security should move beyond a statecentric approach to address human security, non-traditional andenvironmental issues. A working definition of energy security needs to go
beyond the traditional notions of availability, affordability and reliability to also
include sustainability. A conceptual framework could address the multidimensional issues of energy security that encompass global issues such as
climate change; transnational issues that relate to interconnectivity andtransboundary effects (for instance, of nuclear accidents); and the impact on
local communities.

1 Energy policies face a trilemma of security, affordability, and sustainability.
There is no single technology that can address all three aspects
simultaneously. For example, renewable energy sources (RES) reducegreenhouse gas emissions and costly energy imports. They also make apositive impact on energy poverty by providing off-grid solutions to rural areas.
Asia remains one of the most dynamic regions for RES globally, both in termsof installed capacity and technology export. At the same time, RES still
struggle with the variability of electricity generation, the lack of low-coststorage technologies and high – albeit decreasing – capital costs.
 Energy policies are national choices first and foremost. States in the region
will place greater emphasis on national energy legislation and national
benefits than cooperative regional choices. However, diversification of theenergy mix and energy security is enhanced through regional and subregional cooperation. This can be achieved by collaborating to implement
advanced energy technologies and building capacity in renewable energy
sources.
 Regional cooperation must be underpinned by national environments that
support the diversification of energy sources. A supportive national
environment could include a) open markets; b) long-term and predictablelegislation for renewables capacity building such as goals and target setting;c) full cost pricing of conventional sources; and d) incentives for renewableenergy sources.
 Asia is increasingly considering nuclear energy sources in addition torenewables as states try to meet growing domestic demand for energy while
reducing carbon emissions. This brings both opportunities and challenges.
Nuclear energy can contribute to a low-carbon energy mix. To benefit from
nuclear power, the region should cooperate to uphold strong nuclear safety
and governance regulations. This should begin with the safe operation ofnuclear power plants. To reduce the risk of a nuclear accident, anindependent regulatory framework as per IAEA guidelines and properly
trained personnel (including competent operators) will be essential for safe
and sustainable nuclear energy development.
 Within the Asia-Pacific, sub-regional cooperation on specific energy security
issues potentially leading to wider regional cooperation should beencouraged. Also, a network of centres of excellence on nuclear energy
should be established to foster cooperation.

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 ASEAN has a key role to play in promoting cooperation in the regional energy
mix and energy security among both member states and non-member statesin the Asia-Pacific. By promoting regional cooperation, ASEAN can build unity
around this salient issue and further ASEAN centrality in the regionalarchitecture.
Constructing Scenarios
Drawing on the above findings, the Study Group endeavoured to project theseissues into the future to better inform long-term policy planning. Scenario
planning methodology was used to highlight future scenarios for regional energy
security and the energy mix
Scenario planning is a methodology that takes into account the uncertainty offuture events and how to best plan and respond to them today. It is not predictive,
but rather suggests narratives about the future and how to facilitate positive
outcomes while mitigating negative outcomes. The future of regional energy
security and the energy mix is inherently uncertain. However, the actions taken
by regional states today can help bring about positive future realities. ThisCSCAP Study Group conducted a scenario planning exercise to gain a greater
understanding of future scenarios of regional energy security and the energy mix,
the impact of these scenarios, and what steps states can take to attain positive
future scenarios while mitigating the impact of negative scenarios.
III. Recommendations
Based on a discussion of 16 alternate scenarios, the Study Group presents twoscenarios to best highlight the effect of regional cooperation, or lack thereof, onenergy security.
Green Collaborative Region
Narrative: The Green Collaborative Region cooperates for a more energy
efficient world that is climate friendly and protects the planet. States in the region
recognise the need to cooperate both at a technological level and through norms
and institutions for a sustainable energy future. There is high regional investment
in energy efficiency measures and renewable technologies to diversify theenergy mix away from conventional sources with a high CO2 footprint. The
region uses institutional structures such as ASEAN to enhance regional
cooperation and promote climate friendly norms. Open market forces encouragehigh levels of cross-sector and cross-border investments in energy efficientindustries. There is high connectivity through institutions, people-to-people
engagement, and infrastructure commitments.

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Policy Recommendations: Study group members recommended several policy
measures to attain this scenario:(a) There should be more cross-investment, public-private partnerships,and joint research and development initiatives in the field of
renewables and other low-carbon energy sources.
(b) Regional states should further facilitate information sharing,transparency and emergency planning to promote confidence in ourenergy choices.
(c) State and non-state stakeholders should enhance infrastructure
cooperation and interconnectivity (e.g., power grids, pipelines, andregional oil and gas storage/reserves).
(d) There should be regional and in some cases cross sub-regional energy
trade in power and gas pipelines, as well as pooling and interconnection of electric power grids. This would require regionalcooperation and coordination to close existing gaps, and may require
retooling existing institutions or creating new ones to facilitate suchenergy exchanges.
(e) There is a need for cooperation in energy pricing issues (particularlynatural gas/LNG) to address the issue of price volatility.
Tech-Driven State-Centric Region
Narrative: In the Tech-Driven State-Centric Region, states will continue to rely on
conventional energy sources with a high CO2 footprint. At the same time, states
are investing in energy technologies to ensure national energy security andnational benefits. These technologies include nuclear power, unconventional(especially fracking), clean coal technology, and renewable sources (whencompetitive with conventional sources). Regulatory frameworks support national
efforts by promoting these industries in the domestic energy market. Protectionist
measures are adopted to benefit the national economy. States focus on national
interests in energy production rather than regional cooperation or theenvironment.
Policy Recommendations: Study group members cited a number of policy
consequences from the second scenario and measures to mitigate negative
outcomes:

4(a) There is a need for regional states to uplift environmental protection
awareness and to realise that the diversification of energy sources will
benefit employment, public health, environment, and social stability instates.
(b) States need to address the negative aspects of state-centric
approaches, including air pollution, damming, nuclear accidents, anddownstream pollution. There is a need to encourage states to movetowards a minimum CO2 footprint and for increasing state investment inclean and efficient energy technologies. This will help to realise rapid
emission reduction as suggested at the Paris Climate Change Summit.
As a clean, reliable, abundant and efficient energy source, natural gas
may be capable of easing the world's transition into the age ofrenewable energies.
(c) In this state-centric scenario there remains a need to address thetraditional security considerations of securing cross-border production
and transportation of conventional energy sources.

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ABOUT CSCAP
CSCAP is a non-governmental (second track) process for dialogue on security
issues in the Asia Pacific. Membership in CSCAP is on an institutional basis andconsists of Member Committees. Current membership comprises Australia,
Brunei Darussalam, Cambodia, Canada, China, the EU, India, Indonesia, Japan,
the Democratic People’s Republic of Korea, the Republic of Korea, Malaysia,Mongolia, New Zealand, the Philippines, Russia, Singapore, Thailand, Vietnam
and the USA.
The functions of CSCAP are as follows:a. to provide an informal mechanism by which political and security issues
can be discussed by scholars, officials, and others in their private
capacities;
b. to encourage the participants of such individuals from countries andterritories in the Asia Pacific on the basis of the principle of inclusiveness;c. to organise various working groups to address security issues andchallenges facing the region;d. to provide policy recommendations to various intergovernmental bodies onpolitical-security issues;e. to convene regional and international meetings and other cooperative
activities for the purpose of discussing political-security issues;
f. to establish linkages with institutions and organisations in other parts of theworld to exchange information, insights and experiences in the area ofregional political-security cooperation; andg. to produce and disseminate publications relevant to the other purposes ofthe organisation.
Study Groups are the primary mechanism for CSCAP activity. As of May 2016,
there were five CSCAP Study Groups. These are concerned with: (i) Energy
Security; (ii) Preventive Diplomacy; and (iii) Non-Proliferation and Disarmament;(iv) Harmonization of Aeronautical and Maritime Search and Rescue; (v) Marine
Environment Protection.
This memorandum was produced by the CSCAP Study Group on Energy
Security and was approved by the out of session CSCAP Steering Committee
Meeting on 15 June 2016.
Further information on CSCAP can be obtained from the CSCAP website atwww.cscap.org or by contacting the CSCAP Secretariat:

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CSCAP Secretariat
c/o ISIS Malaysia
1 Persiaran Sultan Salahuddin
PO Box 12424
50778 Kuala Lumpur
Malaysia
T: +603-2693 9366 Ext 125
F: +603-2693 9375
E: cscap@isis.org.my7

CSCAP Memoranda
CSCAP Memoranda are the outcome of the work of Study Groups approved by theSteering Committee and submitted for consideration by the ASEAN Regional Forumand other bodies.
 Memorandum No.27 – Implementation of United Nations Security Council
Resolution (UNSCR) 1540
Author: Study Group on Countering the Proliferation of Weapons of Mass
Destruction in the Asia PacificDate published: April 2015
 Memorandum No.26 – Towards an Effective Regional Security Architecture for theAsia PacificAuthor: Study Group on Regional Security Architecture
Date published: June 2014
 Memorandum No.25 – Maritime CBMs, Trust and Managing Incidents at Sea
Author: Study Group on Principles for Good Order at Sea
Date published: June 2014
 Memorandum No.24 – Safety and Security of Vital Undersea Communications
InfrastructureAuthor: Experts Group on Vital Undersea Communications Infrastructure
Date published: May 2014
 Memorandum No.23 – Enhancing Water Security in the Asia PacificAuthor: Study Group on Water Resources Security
Date published: January 2014
 Memorandum No.22 – Non-Proliferation of Weapons of Mass Destruction
Author: Study Group on Countering the Proliferation of Weapons of Mass
Destruction in the Asia PacificDate published: September 2012
 Memorandum No.21 – Implications of Naval Enhancement in the Asia PacificAuthor: Study Group on Naval Enhancement in the Asia PacificDate published: August 2012
 Memorandum No.20 – Ensuring A Safer Cyber Security Environment
Author: Study Group on Cyber Security
Date published: May 20128 Memorandum No.19 – Reduction and Elimination of Nuclear Weapons
Author: Study Group on Countering the Proliferation of Weapons of Mass
Destruction in the Asia PacificDate published: February 2012
 Memorandum No.18 – Implementing the Responsibility to Protect (RtoP)
Author: Study Group on the Responsibility to Protect (RtoP)
Date published: September 2011
 Memorandum No.17 – Promoting the Peaceful Use of Nuclear Energy
Author: Study Group on Countering the Proliferation of Weapons of Mass
Destruction in the Asia PacificDate published: June 2011
 Memorandum No.16 – Safety and Security of Offshore Oil and Gas Installations
Author: Study Group on Safety and Security of Offshore Oil and Gas Installations
Date published: January 2011
 Memorandum No.15 – The Security Implications of Climate Change
Author: Study Group on the Security Implications of Climate Change
Date published: July 2010
 Memorandum No.14 – Guidelines for Managing Trade of Strategic Goods
Author: Export Controls Experts Group (XCXG)
Date published: March 2009
 Memorandum No.13 – Guidelines for Maritime Cooperation in Enclosed and SemiEnclosed Seas and Similar Sea Areas of the Asia PacificAuthor: Study Group on Facilitating Maritime Security Cooperation in the Asia
Pacific
Date published: June 2008
 Memorandum No.12 – Maritime Knowledge and Awareness: Basic Foundations ofMaritime Security
Author: Study Group on Facilitating Maritime Security Cooperation in the Asia
Pacific
Date published: December 2007
 Memorandum No.11 – Human Trafficking
Author: Study Group on Human Trafficking
Date published: June 20079 Memorandum No.10 – Enhancing Efforts to Address Factors Driving InternationalTerrorism
Author: Study Group on Enhancing the Effectiveness of the Campaign AgainstInternational Terrorism with Specific Reference to the Asia Pacific Region
Date published: December 2005
 Memorandum No.9 – Trafficking of Firearms in the Asia Pacific Region
Author: Working Group on Transnational Crime
Date published: May 2004
 Memorandum No.8 – The Weakest Link? Seaborne Trade and the Maritime
Regime in the Asia PacificAuthor: Working Group on Maritime Cooperation
Date published: April 2004
 Memorandum No.7 – The Relationship Between Terrorism and Transnational
CrimeAuthor: Working Group on Transnational Crime
Date published: July 2003
 Memorandum No.6 – The Practice of the Law of the Sea in the Asia PacificAuthor: Working Group on Maritime Cooperation
Date published: December 2002
 Memorandum No.5 – Cooperation for Law and Order at SeaAuthor: Working Group on Maritime Cooperation
Date published: February 2001
 Memorandum No.4 – Guidelines for Regional Maritime Cooperation
Author: Working Group on Maritime Cooperation
Date published: December 1997
 Memorandum No.3 – The Concepts of Comprehensive Security and Cooperative
Security
Author: Working Group on Comprehensive and Cooperative Security
Date published: December 1995
 Memorandum No.2 – Asia Pacific Confidence and Security Building Measures
Author: Working Group on Confidence and Security Building Measures
Date published: June 1995
 Memorandum No.1 – The Security of the Asia Pacific Region
Author: CSCAP
Date published: April 1994

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