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16 ธ.ค. 2025
Insight
Asia
Asia power demand is expected to grow again in 2026, as digital and industrial activity accelerates. The region also faces an increase in both extreme weather and geopolitical uncertainty, both exerting their own pressures on energy security, supply, pricing and policy.
"The massive increase in data centre investment has triggered the need for advances within the energy industry itself in order to better manage power demand," said Partner and Head of Energy Sector, Anthony Patten.
"Industry innovations such as edge computing increase power demand, but they also make energy generation systems more adaptable, resource efficient and resilient – supporting both growth and decarbonisation."
"This shift creates new requirements for cross-border data flows, energy trading analytics and grid resilience, which will influence investment choices and project timing across Asia."
"In this context, we believe that five trends will shape Asia’s energy markets and industries in the year ahead."
Resilient energy supply chains will drive cross-border collaboration
Geopolitical shifts and energy security concerns will drive closer regional cooperation. Cross-border partnerships and projects will become more common to maintain energy security and advance decarbonisation. China, India, Japan and Southeast Asia are all leveraging LNG, renewables, battery technology and carbon capture systems to diversify and strengthen their energy supply chains.
Data centres will reshape Asian energy demand
Increased demand for data centres and other digital infrastructure across Asia is reshaping regional power consumption planning. AI services and e-commerce are the primary drivers, pushing utilities to prioritise energy-efficient and low-emission infrastructure. As power density per server rack rises, grid reliability planning and capacity development will be needed to keep pace with the expansion of the digital economy.
Asia's nuclear ambitions will hit new highs
Nuclear energy is entering a new growth cycle across Asia Pacific. China is progressing substantial capacity expansion, supported by large-scale and small modular reactor programmes. Southeast Asia, Japan and India are reviving or accelerating nuclear projects along with the necessary regulatory reforms. The drive for energy security and grid reliability is attracting investment to nuclear and could shape regional energy supply chains through to 2050.
LNG demand in Asia will rebound
Asian LNG demand is forecast to rebound in 2026 as prices stabilise. With new global supply coming online and ongoing efforts to reduce coal dependence, LNG will remain the most reliable bridge fuel for power generation, particularly in China, India, Japan and Southeast Asia, where infrastructure is expanding rapidly. However, bottlenecks are starting to appear, especially in LNG shipping and construction capacity, given the number and scale of projects reaching final investment decision. The timing impacts vary from project to project and will depend heavily on planning by project sponsors.
Renewables and batteries to remain at the heart of China’s energy expansion
China’s 2026 energy growth will again be led by the deployment of renewables and energy storage, with a strong emphasis on batteries. This massive domestic build-out will require equally large investment in large-scale battery storage, both to stabilise the national grid and to manage the growing share of variable clean-energy sources. Domestic growth will also help to maintain China's leadership in global battery and renewables supply chains. China will continue to export battery systems across Asia and beyond, supporting other countries to integrate renewables and stabilise their grids.
Key contacts
Anthony Patten
Partner, Global Head of Energy, Singapore
Andrew Blacoe
Managing Partner, Tokyo Office, Tokyo, Africa Group and Latin America Group
Lachlan Clancy
Partner, Tokyo
Adrian Wong
Partner, Singapore and Vietnam Group
Matthew Goerke
Partner, Jakarta
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