The second day of Energy Asia 2025 crystallized the defining challenge of our time for the world‘s most populous continent: forging a unique and equitable energy transition path while confronting a “polycrisis” of market uncertainties and a staggering surge in energy demand, largely fueled by the advent of artificial intelligence. Convening nearly 3,000 attendees from 60 countries, the conference underscored a resounding call for a distinct “Voice of Asia” in the global energy dialogue, moving beyond traditional Western-centric frameworks to address the region’s specific needs. As industry leaders debated strategies for a carbon-constrained future, the Malaysian government unveiled a decisive, multi-billion-dollar roadmap towards its 2050 net-zero ambition, signaling a period of profound transformation for the region’s energy landscape.
KUALA LUMPUR – The discussions at the Kuala Lumpur Convention Centre painted a vivid picture of a region at a strategic crossroads, grappling with the dual imperatives of powering unprecedented economic growth and meeting urgent climate commitments. Tan Sri Tengku Muhammad Taufik, President & Group CEO of PETRONAS and Chairman of Energy Asia, articulated this central theme, emphasizing that the global energy conversation requires an authentically Asian perspective. He argued that energy investments demand a long-term view that transcends the volatility of governmental and policy shifts to safeguard long-term energy security needs. “Energy Asia 2025,” he stated at a press conference, “aims to provide a distinct ‘voice of Asia’ and an Asian framework for addressing energy issues, moving beyond a traditionally North-West European-centric discussion.”
This need for a regional approach is thrown into sharp relief by Asia’s unique energy demand profile. The rapid growth in electricity consumption across the continent, exemplified by Malaysia’s own 6.5% increase, presents a formidable challenge. Tan Sri Tengku Muhammad Taufik highlighted what he termed a paradox: the surging energy demand, particularly from the “real rush for data centres” driven by artificial intelligence, is occurring precisely at a time when the call for an energy transition is at its most urgent. This exponential growth in demand has tangible consequences, leading to discussions around Malaysia’s potential future as a liquefied natural gas (LNG) importer, with preparations already underway for a third regasification terminal to meet rising domestic needs.
The complexity of the current environment was captured in the term “polycrisis,” a concept introduced to describe the multifaceted challenges confronting energy players. This includes the difficult reality of monetizing tougher reserves with higher CO2 content, navigating uncertain demand outlooks, and adapting to the systemic shift towards more electron-based and intermittent energy systems. It is within this intricate context that PETRONAS frames its mission, with its chief executive asserting the belief in enriching lives while building a sustainable future, positing that meeting energy demand does not have to be a destructive endeavor. The challenge for Asia, with its diverse economies and a vast population striving for economic upliftment, is to manage this growth responsibly and equitably, ensuring no segments of society are left behind.
Against this backdrop, the Malaysian government presented one of the most comprehensive national strategies discussed at the conference. During a Ministerial Plenary session, top officials detailed the nation’s aggressive push to achieve its 2050 net-zero greenhouse gas emission target. Senator Datuk Seri Amir Hamzah Azizan, Malaysia’s Finance Minister II, underscored the scale of the task, noting that the energy sector currently accounts for a massive 79% of the nation’s 328 million tonnes of CO2 equivalent emissions. He emphasized that achieving this goal requires substantive reforms that go beyond mere policy announcements, demanding the deep integration of sustainability principles throughout all economic reforms.
A cornerstone of this strategy is a planned MYR43 billion investment to upgrade the national grid. This critical infrastructure overhaul is designed to support the decarbonization of Malaysia’s energy sector by significantly boosting renewable energy’s share in the electricity mix, with a target to double it from the current 8% to 16%. Further reinforcing this commitment, the government is preparing for the introduction of a carbon tax in 2026, a move that will be preceded by a crucial rationalization of subsidies to remove market distortions and create a level playing field for cleaner technologies. This structural reform is complemented by a suite of fiscal incentives, including the Green Investment Tax Allowance and Green Income Tax Exemption, alongside robust support for green financing, blended finance, and green sukuk to mobilize private capital.
This entire effort is guided by the National Energy Transition Roadmap (NETR), a landmark policy launched in 2023. Akmal Nasrullah Mohd Nasir, the Deputy Minister of Energy Transition and Water Transformation, elaborated that the NETR outlines 10 catalyst projects and six key decarbonisation levers, including energy efficiency, renewables, and hydrogen. The roadmap is ambitious in its scope, aiming to expand utility-scale solar projects tenfold, from 400 MW to 4,000 MW, and increase household solar adoption through Net Energy Metering programmes. The plan also acknowledges the potential necessity of exploring nuclear energy to meet baseload power demands on the path to 2050. This “whole-of-nation” approach is further supported by regional collaboration, particularly through the ASEAN Power Grid initiative, which is seen as vital for enhancing energy resilience and facilitating green energy trading across Southeast Asia.
As governments chart new policy courses, industry players are simultaneously reshaping their core strategies to create value in a carbon-constrained world. A plenary session on upstream strategies revealed a clear pivot among energy majors. Mohd Jukris Abdul Wahab, Executive Vice President & CEO of Upstream at PETRONAS, detailed his company’s commitment to sustainable value creation through aggressive portfolio reshaping and a strategic prioritization of gas, which now constitutes 78% of its holdings. Critically, all investment decisions now systematically integrate carbon pricing and abatement costs, fundamentally changing how projects are evaluated.
This approach was echoed by European major Eni, whose representative, Guido Brusco, highlighted a diversification strategy focused on what he called “advantaged barrels”—resources located near existing infrastructure in favorable geographies that can be brought to market faster and with a lower carbon footprint. By accelerating project timelines and expanding investments into carbon capture and storage (CCS), biorefineries, and other emerging technologies, Eni aims to solidify its competitiveness. The crucial role of technology was emphasized by Amerino Gatti of Baker Hughes, who pointed to digitalisation and AI-driven solutions as key enablers for optimising drilling, enhancing asset performance, and improving efficiency across the entire energy lifecycle through innovations like autonomous drilling and predictive maintenance.
This operational pivot is intrinsically linked to a deeper, philosophical shift that places sustainability at the heart of corporate strategy. In a session featuring senior sustainability executives, the consensus was that integrating responsible environmental practices is no longer optional but essential for long-term viability, especially amid growing geopolitical uncertainty. Charlotte Wolff-Bye, PETRONAS’s Chief Sustainability Officer, stressed that decarbonisation efforts must coexist with nature preservation, a point made tangible by the company’s Energy and Nature Forum. This is particularly resonant for Malaysia, home to one of the world’s oldest rainforests.
The economic case for this integration was powerfully made by Dr. Naoko Ishii of the University of Tokyo, who argued that the loss of nature directly impacts half of the world’s gross domestic product, highlighting an urgent need for financial systems to properly account for natural capital. Karen Westley of Shell demonstrated how sustainability can directly drive business competitiveness, citing operational efficiencies gained through simple measures like reducing single-use plastics on offshore platforms. The discussion affirmed that the role of the Chief Sustainability Officer is critical in framing sustainability not as a cost burden, but as a value-driven strategy that builds resilience and secures a company’s social license to operate.
As the second day of Energy Asia 2025 concluded, a clear narrative emerged: Asia is not passively waiting for a global template for the energy transition. Instead, it is actively defining its own terms, driven by a unique combination of explosive demand, profound national ambition, and a new generation of corporate strategies that view sustainability and technological innovation as inseparable pillars of future success. The road ahead requires bold investment, courageous policy reform, and unprecedented collaboration, but the dialogue in Kuala Lumpur signals a region determined to lead in shaping a more resilient and responsible global energy future.
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