THE Philippines is revealed to have the largest cost difference between solar and gas power among five major Southeast Asian economies that are planning nearly 49 gigawatts (GW) of new gas-fired capacity. This development occurs as governments seek to meet rising demand and ensure reliability. However, it could lock the region into more expensive power while ironically solar costs fall sharply.
A briefing released on Oct. 1 by international research group Zero Carbon Analytics (ZCA) found that gas plants in preconstruction or construction stages in Indonesia, Malaysia, Thailand, the Philippines and Vietnam could produce about 263 terawatt-hours (TWh) of electricity annually. The estimate is based on data from Global Energy Monitor’s Global Oil and Gas Plant Tracker.
Yet, generating the same volume from solar would cost about $45.4 billion less, according to the analysis. Across the five countries, solar was on average 50-percent cheaper than gas in 2025, with the gap projected to reach 84 percent by 2030, based on ZCA calculations using BloombergNEF and International Energy Agency data.
The Philippines recorded the widest disparity. In 2025, solar electricity averaged $54 per megawatt-hour (MWh) compared with $99 per MWh for gas, making solar about 59-percent cheaper. By 2030, solar could be 86-percent cheaper than gas in the country.
This cost gap carries direct implications for power rates, energy security and long-term planning for the Philippines, which imports nearly all of its gas and liquefied natural gas requirements and remains exposed to global fuel price volatility.
ZCA warned that new gas infrastructure risks becoming economically uncompetitive as renewable costs decline and as assets face fuel price swings and potential underutilization.
Indonesia, Malaysia, Thailand and Vietnam are pursuing large gas pipelines, even as solar has already undercut gas on cost in 2025 and is expected to widen its advantage by 2030.
At the same time, large electricity users, particularly technology companies expanding data center operations, are increasingly contracting directly for renewable power.
Between 2025 and 2026, Microsoft Indonesia signed an agreement with PT PLN to procure 200 MW of renewable electricity including 100-MW solar; Google secured 1 TWh of solar for its data centers in Malaysia; and Samsung Electronics signed Vietnam’s first grid-based direct power purchase agreement for 70 GWh of solar.
Companies in the Philippines and Thailand have signed clean power deals in recent months.
“Energy policy has yet to catch up to where the market is going.
Businesses are increasingly choosing renewable electricity, showing that business leaders recognize the economic and energy-security benefits of the clean energy transition, even as major Asean governments continue to plan tens of gigawatts of new gas,” said Yu Sun Chin, ZCA senior Asia regional researcher.