AEMI benefits


Market integration, ranging from the economy to energy and the environment, has shown it has provided huge benefits for integrated markets. This chapter, which suggests that the ASEAN Energy Market Integration (AEMI) will reap a similar benefit in the energy market, revisits the theoretical background of market integration, reviews the experiences of energy market integration in other areas of the world – i.e., the European Union as well as West African countries – and draws lessons from these experiences for AEMI. In addition, it identifies the benefits that would accrue to AEMI. The identified economic benefits are increases in gross domestic product (GDP), the convergence and stabilization of energy prices, and more foreign direct investment (FDI) in the integrated energy market. The identified energy benefits are enhanced energy security, higher energy efficiency, lower energy system costs and higher energy development indicators. There would also be environmental benefits such as lower CO2 emissions.

Youngho Chang (lead), Assistant Professor, Division of Economics, Nanyang Technological University, Singapore

Tri Widodo, Professor, Head of Economics, Faculty of Economics and Business, Gadjah Mada University, Indonesia.

Nguyen Thi Mai Anh, Lecturer, Department of Industrial Economics, School of Economics and Management, Hanoi University of Science and Technology, Viet Nam

Phouphet Kyophilavong, Associate Professor and Director, Research Division, Department of Economics and Business Management, National University of Laos, Lao People’s Democratic Republic

(September 2013)

Read full document – AEMI Working Paper- AEMI Benefits