AI and Clean Energy: Accelerating Asia’s Sustainable Future

Powering Progress in Asia: AI and Energy

The rise of artificial intelligence (AI) presents a unique chance to boost economic growth, improve productivity, and support the societal changes needed to speed up the energy transition. Energy is a key focus for policymakers and business leaders, as it intersects with economic opportunities, innovation, industrial development, digital transformation, and environmental concerns.

Asia-Pacific, home to some of the fastest-growing economies and largest urban populations, is expected to account for two-thirds of the increase in global electricity demand by 2030, according to the International Energy Agency (IEA). Alongside this surge is rapid growth in digital infrastructure, including datacenters, cloud computing, and AI. In 2024 alone, Asia installed over 413 GW of new renewable energy capacity, representing 71% of the world’s total. In Southeast Asia, electricity demand is projected to triple by 2050 due to population growth, urbanization, and rising cooling needs. Expanding carbon-free electricity, modernizing grids, and embedding sustainability into AI infrastructure will enhance energy security, create jobs, and strengthen leadership in both clean energy and economic growth.

Scaling Clean Energy and Sustainability Solutions

Across Asia, companies are committing to long-term agreements to procure clean electricity and deploying technologies—like AI-driven grid forecasting and circular datacenter designs—that improve energy system reliability and sustainability. Collaboration with governments, utilities, and industry groups helps remove policy barriers and speeds progress in clean energy supply, market development, water resilience, and circularity.

Expand Clean Energy Supply and Market Development

Demand for carbon-free electricity drives the expansion of clean energy. Globally, more than 34 GW of carbon-free electricity contracts have been signed across 24 countries, with 19 GW secured in 2024 alone. In Asia-Pacific, this approach unlocks developer financing and creates models for replication. Examples include a 20-year virtual power purchase agreement (PPA) for 25 MW of solar energy in Japan, a rooftop solar portfolio in Singapore totaling up to 200 MW, and a 10-year agreement supporting geothermal power development in New Zealand.

Investment funds also support innovative financing models that accelerate clean energy deployment. For instance, investments in Southeast Asia have mobilized billions of USD and prevented millions of tons of CO₂ emissions by de-risking early-stage renewable projects and unlocking private capital.

Support Policies and Technologies That Expand Carbon-Free Electricity and Grid Infrastructure

Policy plays a critical role in renewable energy growth. Regulations affect project permitting speed, clean power affordability, and corporate buyers’ access. In South Korea, a new law strengthening the national power grid passed in early 2025, enabling more renewable integration and opportunities for corporate buyers. This reflects how government leadership combined with collaborative advocacy can clear bottlenecks.

AI is also being used to improve clean power reliability. For example, an AI platform built on cloud infrastructure predicts solar and wind output with higher accuracy, reducing errors and enhancing maintenance decisions. This helps increase renewable energy integration even before new transmission lines are completed.

Strengthen Water Resilience

Water scarcity and quality issues pose major sustainability challenges in Asia. Datacenters rely on water for cooling, so reducing water use and supporting community water resilience is essential. Projects include installing rainwater harvesting systems in schools in Malaysia, conserving millions of liters annually in India, and restoring water flows through wetland creation in South Korea.

Advance Circularity

Reducing datacenter waste is another priority. Hardware from decommissioned servers is reused or recycled, with components donated to schools and training programs. Investments in recycling rare earth magnets help lower the need for mining and improve supply chain sustainability.

AI as a Tool for Decarbonisation

AI’s potential goes beyond digital infrastructure growth. The IEA estimates that AI, when deployed effectively, could reduce global emissions by enabling broader use of existing technologies—potentially offsetting up to three times the indirect emissions generated by datacenters worldwide.

In Asia’s complex and evolving energy systems, AI offers three main benefits: measuring, predicting, and optimizing national power grids in real time; accelerating materials science innovation, such as new battery chemistries and low-carbon fuels; and transforming fragmented data into actionable insights for faster deployment, stronger supply chains, and improved financing.

For example, AI-powered forecasting tools on power grids can predict renewable energy output and demand surges, optimizing transmission asset use and allowing more clean energy connections without waiting for new infrastructure. AI also shows promise in speeding up permitting processes, a major barrier to renewable project development. Collaborations worldwide are exploring how AI can reduce the time and cost of permitting new energy infrastructure, with early discussions underway in Asia.

Policy and What Comes Next

Supportive policies amplify progress. Governments can unlock investment, stimulate innovation, and scale solutions more quickly than any single company. Three key priorities stand out:

• Expand grid infrastructure. Addressing grid bottlenecks is vital for digital growth and decarbonization. Governments should streamline permitting, shorten interconnection timelines, and apply digital tools—including AI—to optimize existing assets. Open, trusted platforms enable utilities and regulators to plan and operate grids efficiently in real time.
• Enable clean energy development and access. Meeting rising electricity demand and decarbonizing economies require public-private coordination to scale technologies, speed permitting, and create procurement pathways that ensure inclusive access.
• Utilize AI as an innovation accelerator. AI empowers people to build clean, efficient, and resilient energy systems by optimizing resource use, improving efficiency, and fostering new carbon-free solutions that support economic growth and environmental goals.

The IEA estimates emerging Asian economies need to increase clean energy investments fivefold—to about USD 190 billion annually by 2035—to meet security, climate, and development targets. Grid modernization alone demands USD 30 billion per year. This calls for urgent, coordinated public-private action.

By combining clean energy procurement, AI deployment, and policy collaboration, stakeholders can drive emissions reductions alongside inclusive growth, regional resilience, and technological leadership. The window to act decisively and collaboratively is now.