Energy security Pillar

The Lower Mekong Initiative (LMI), launched in July 2009, responds to collective policy challenges and opportunities shared by Cambodia, Lao PDR, Myanmar, Thailand, and Vietnam. The LMI seeks to build capacity and human resources in these countries through mutual cooperation and the sharing of relevant human and technological expertise on challenges in six areas of cooperation: Connectivity; Education; Environment and Water; Health; Agriculture and Food Security; as well as Energy Security.

Preamble

Over the next decade, energy consumption in the Mekong Sub-Region is expected to increase at least 5 percent annually, propelled by overall economic growth. The use of limited and gradually exhausted fossil fuels is not only associated with environmental and health impacts, but the consumption of petroleum and the import dependence also greatly impact national budgets, trade balances, and household incomes. Developing new sources of energy, ensuring access to energy, and enhancing regional interconnectivity are important if countries in the Mekong Sub-Region want to increase their energy security and economic competitiveness.

Overarching Goals of the LMI Energy Security Pillar
  1. To enhance energy security and accessibility with due consideration to health, safety, and environment for the sustained prosperity, growth, and integrated development of the Mekong sub-region in line with development in this area in the Association of Southeast Asian Nations (ASEAN).
  2. To ensure regional energy sustainability through diversification, development, and conservation of resources, the efficient use of energy, and the wider application of environmentally-sound technologies.
Objectives in Support of Pillar Goals
  1. To strengthen international and regional cooperation in the Mekong sub-region on the aforementioned areas, to develop and introduce clean, renewable, and alternative energy technologies; encourage greater reliance on renewable and non-conventional energy; increase regional energy trade and investment; and support and promote new innovations for energy efficiency and conservation.
  2. To support the production, use, research, and development of renewable and alternative energy sources.
  3. To promote energy efficiency and conservation with the goal of reducing regional energy intensity by an average of 8 percent by 2015, in line with ASEAN goals.
  4. To encourage inter- and intra-regional information sharing and capacity building on conventional and alternative energy sources, energy market development and investment, and integration of best practices on energy conservation.
  5. To expedite regional connectivity projects in the power, oil, and gas sectors, further facilitating energy trade, investment, and services; to enhance cooperation with partner countries to promote robust energy and power connectivity in the sub-region.
  6. To engage and leverage private sector expertise and resources through public-private partnerships (PPPs).
Proposed Areas of Cooperation

Regional Energy Market Development:
Meets Objective: #1- strengthen international and regional cooperation; #5 - expedite regional connectivity projects; and #6 - engage and leverage private sector expertise and resources

  • Focus on the development of alternative energy sources, including renewable energy, and shale and other unconventional gas sources as a way to enhance energy security among countries of the Mekong Sub-Region.
  • Support the development of alternative energy technologies in key economic sectors, particularly the manufacturing sector.
  • Promote public-private partnerships in alternative energy production and utilization.
  • Focus on the Harmonization of policies, laws, and regulations, and build regulatory capacity to tap the synergies and competitive advantages that exist from inter-country energy trade
  • Formulate strategies to minimize the environmental impact of unconventional gas extraction. Build regional understanding of development issues including available technology, production management and effective regulatory policies.

2013-2014 Proposed Activities

  • Unconventional Gas Technical Engagement Program (UGTEP): State will strengthen its engagement on the sustainable development of unconventional gas through a regional workshop that could be co-hosted with a regional partner. This workshop, which is a follow-up to the regional gas market and unconventional gas workshop that was held in Jakarta, Indonesia in May 2013, would specifically focus on the technical, environmental, regulatory, and financial aspects of unconventional gas development in Southeast Asia. (Lead: State in coordination with DOI)
  • Regulatory and Market Development in the Power Sector: The United States will provide targeted technical assistance for engagement with the National Association of Regulatory Utility Commissioners (NARUC), which will impart experiences and lessons learned from comparable and applicable regional settings on topics ranging from consensus-building, regulatory policy and system planning coordination, and other participatory models of regulation. The development of these components will lay the necessary foundation for the creation of an enabling environment to attract private sector capital.
    • First event (October 2013): In a technical workshop setting, regulatory experts covered topics that were identified by each region as priority focus areas, including cost reflective tariffs, incentive schemes for renewables, protection of vulnerable consumers, regulatory harmonization for interconnection, and resource planning.
    • Follow-up capacity building events will continue to engage energy regulators, other regulatory authorities and representatives from the U.S. in exchanging information on issues of mutual interest.

Power Interconnection:Recognizing that: (1) substantial regional interconnection plans have been discussed for over two decades and most of the projects that were planned for 2003-2015 have not yet begun; (2) interconnection efforts of the broader ASEAN context must be considered because most proposed interconnection initiatives involve nations both inside and outside of the Lower Mekong Basin; and (3) it is critical to coordinate with groups already working on regional power interconnection, such as the ASEAN Ministers on Energy, the ASEAN Power Grid Consultative Committee (APGCC), and the Heads of ASEAN Power Utilities/Authorities (HAPUA) Council.
Meets Objective: #1 - strengthen international and regional cooperation; #5 - expedite regional connectivity projects; and #6 - engage and leverage private sector expertise and resources.

  • Explore how best to create a regional regulatory framework robust enough to ensure that power interconnection projects are completed and achieve stated goals and outcomes within appropriate time periods.
  • Support the establishment of a regional power coordination center to facilitate power trade among countries in the Mekong sub-region.
  • Undertake a technical review of existing ASEAN and Greater Mekong Sub-Region (GMS) power interconnection plans to identify potential barriers to regional interconnection.
  • Explore financing models for cross border projects that can be used by the countries and multilateral development banks to raise the necessary capital – either public sector or private - to develop these projects

Energy Efficiency and Conservation:
Meets Objectives: #1- strengthen international and regional cooperation; #3 - promote energy efficiency and conservation; and #6 - engage and leverage private sector expertise and resources.

  • Promote high-performance energy efficiency technologies and practices as well as focus on how to transfer knowledge, best practices, and lessons learned amongst LMI nations.
  • Develop policy and institutional capacity building and how to create energy efficiency and conservation awareness and build greater technical, financial and regulatory expertise.
  • Strengthen human capacity and harmonize standards, such as those for electrical appliances among LMI countries in order to promote energy efficiency.
  • Create mechanisms or policies to promote cooperative projects on energy efficiency and conservation.

2013-2014 Proposed Activities

  • Rural Electrification with Renewable Energy Project: In concert with the annual meeting of the ASEAN Renewable Energy-Sub-Sector Network (RE-SSN), the United States will work with partners to explore the potential for the use of distributed renewable power to meet the energy needs of rural communities. This will include information exchanges to examine lessons learned from previous applications, the technologies employed in these systems, and the financial and regulatory structures that are necessary to make these systems commercially viable. The ultimate goal of these exchanges will be to help countries develop strategies for financing and widespread deployment of appropriate distributed energy systems.
  • Regional Energy Efficiency & Conservation Event: Co-organized by the United States and one or more LMI countries, the event would focus on methods to harness energy efficiency as an alternative to new supply-side development and overcoming energy efficiency financial, technical, and policy barriers. It would include sessions on addressing borrowing capacity, raising awareness and communication, assessing risk, managing projects, developing energy service companies (ESCOs), measuring and verifying project results, and overcoming other energy efficiency challenges specific to South East Asia. To maximize international exposure and sharing of lessons-learned, the event could be held on the sidelines of a larger regional event, for example the Renewable Energy Asia Conference in Bangkok in June 2014, or upcoming event conducted by the Asian Development Bank or World Bank.

Transparency and Good Governance:
Meets Objective: #1 - strengthen international and regional cooperation; #3 - promote energy efficiency and conservation; and #4 - encourage inter and intra-regional information sharing and capacity building.

  • The working group could build capacity for stakeholders to implement good and transparent energy management.
  • The working group could utilize academic institutions with a focus on energy issues in ASEAN as a training and discussion platform.

2013-2014 Proposed Activities

  • Extractive Industries Transparency Initiative (EITI) The LMI partners will invite the international EITI Secretariat to lead a session at the LMI Working Group November 7 2013 to share general information on EITI for consideration by LMI countries. Myanmar and the United States can share their experiences working toward EITI membership, and Vietnam may discuss its recent commitment to join the initiative. The working group will consider arranging further discussions regarding mutual challenges countries face in managing their oil and gas sectors, at a future event.

Energy Research and Development:
Meets Objective: #1 - strengthen international and regional cooperation; ; #2 - support the production, use, research, and development of renewable and alternative energy sources; #3 - promote energy efficiency and conservation and; #4 - encourage inter and intra-regional information sharing and capacity building.

  • Support the synergy of research and development centers and think tanks in providing comments and recommendations on strategies for overcoming challenges with developing alternative and renewable energy sources.
  • Promote mechanisms or policy instruments to accelerate research and development on energy.

2013-2014 Proposed Activities

  • Energy Smart Communities Initiative (ESCI): Implemented through APEC for the Asia-Pacific region, the U.S. Department of Energy leads the ESCI Initiative that currently demonstrates through 16 projects the practicality of clean energy technologies to reduce energy intensity both through research, development and demonstration of new technologies and through establishment of best practices for deploying the technologies that are already available. RD&D efforts focus on research, testing, scaling, and development of technologies as well as small scale pilot projects and project demonstrations of the technologies. Best Practice efforts focus on codes, standards, testing methods, regulatory frameworks, and public awareness policies. New projects will be added and reach expanded to include all the ASEAN members.


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