Assessing the Sustainability of Southeast Asia’s Energy Transition: A Comparative Analysis

Faten Derouez () and Adel Ifa
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Faten Derouez: Department of Quantitative Method, College of Business Administration, King Faisal University, Al Ahsa 31982, Saudi Arabia
Adel Ifa: Doctoral School, Faculty of Economic Sciences and Management of Sousse, University of Sousse, Sousse 4023, Tunisia

Energies, 2025, vol. 18, issue 2, 1-24

Abstract: The rapid economic growth in Southeast Asia has heightened concerns about its environmental sustainability, particularly in relation to CO 2 emissions. Despite the growing focus on climate change mitigation, the region faces significant challenges in balancing economic development, energy transitions, and environmental conservation. Existing studies often overlook the complex interplay between these factors, leaving a critical gap in understanding how tailored strategies can address country-specific dynamics. To bridge this gap, this study introduces the “Sustainable Energy-Environment Nexus” (SEEN) framework, which integrates economic growth, energy transitions, and environmental conservation as interconnected elements necessary for achieving carbon neutrality in both the short and long run. Using data from eight Southeast Asian countries (Indonesia, Malaysia, China, South Korea, Vietnam, Singapore, Thailand, and Japan) over the period 1990–2023, this study employs the Autoregressive Distributed Lag (ARDL) approach and the Vector Error Correction Model (VECM) technique to analyze the relationships between CO 2 emissions, GDP, financial development, forest areas, renewable energy, non-renewable energy consumption, and trade openness. The findings reveal that GDP and non-renewable energy consumption significantly drive CO 2 emissions in countries like Indonesia, Malaysia, Japan, and South Korea. Conversely, forest areas, financial development, renewable energy, and trade openness are effective in reducing emissions in countries such as Vietnam and China. This study highlights the critical role of renewable energy adoption while addressing challenges such as inadequate infrastructure and limited technology transfer. It also identifies opportunities for regional cooperation in innovation and policy harmonization. To support sustainable energy development, tailored policy recommendations include incentivizing investments in renewable energy, enhancing technology transfer, expanding forest conservation efforts, and aligning regional renewable energy targets across ASEAN. The SEEN framework provides a robust foundation for advancing research and policy design aimed at reducing CO 2 emissions and promoting environmental sustainability across Southeast Asia.

Keywords: eight Southeast Asian countries; renewable energy; non-renewable energy; CO 2 emissions; ARDL (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2025
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