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263. Asia’s Infrastructure Moment: The Investment Opportunity Behind the Energy Transition

Web title: Behind Asia’s Energy Transition And Infrastructure Opportunity

Episode Description:

Infrastructure investing in Asia is becoming central to the global energy transition as rising energy demand, a focus on energy security, and the need for more resilient systems accelerate capital deployment across the region. In Southeast Asia, the opportunity is not only about replacing old systems, but building new infrastructure at scale for a growing economy.

In this episode of The Bid, host Oscar Pulido speaks live from Ecosperity in Singapore with Salim Samaha, Global Head of Energy at Global Infrastructure Partners, a part of BlackRock, and Heidi Yip, Head of Sustainable and Transition Solutions for Asia Pacific at BlackRock. Together, they discuss how the infrastructure opportunity is evolving globally, why Asia’s infrastructure build-out differs from Western markets, and where investors are seeing momentum across renewables, grids, storage, and system flexibility.

Key insights include:

How Asia’s infrastructure build-out differs from Western markets

Why energy security is becoming inseparable from the energy transition

Where capital is flowing across renewables, grids, storage, and interconnection

How public-private partnerships can help mobilize transition finance

Why execution bottlenecks, permitting, and offtake frameworks remain critical

Where AI, innovation, and rising demand may reshape future infrastructure needs

Keywords: Asia infrastructure investing, energy transition, infrastructure, capital markets, megaforces, renewables, energy security, sustainable investing

Sources: IEA World Energy Investments 2025, Southeast Asia; IEA World Energy Investments 2024; IEA Global Energy Review 2026, Electricity generation mix for selected regions, 2025; IEA Integrating Solar and Wind in Southeast Asia; IEA Southeast Asia Energy Outlook 2024; IEA Global Energy Review 2026, Electricity generation mix for selected regions, 2025; Singapore Monetary Authority Press Release 2024; IEA data and charts energy investments; Urban Population in Southeast Asia, 2023-2050, IEA

Written Disclosures In Episode Description:

This content is for informational purposes only and is not an offer or a solicitation. Reliance upon information in this material is at the sole discretion of the listener. Reference to any company or investment strategy mentioned is for illustrative purposes only and not investment advice. For full disclosures, visit blackrock.com/corporate/compliance/bid-disclosures.

<<TRANSCRIPT>>

Oscar Pulido: So far, the conversation around infrastructure has been about what's needed. More investment, more modernization, more resilience. But today, that conversation is shifting because across many parts of the world, especially in Asia, we're starting to see that build-out happen in real time. Driven by the energy transition, rising demand, and the need for more reliable systems, infrastructure is no longer just a long-term requirement.

It's becoming one of the most active areas of capital deployment globally. And increasingly, investors aren't just asking where the need is, they're asking where the opportunity is and what it takes to unlock it. So how does Asia's infrastructure build-out differ from what we're seeing in Western markets, and where is capital actually flowing today?

Welcome to The Bid, where we break down what's happening in the markets and explore the forces changing the economy and finance. I'm Oscar Pulido. In this special episode, we're coming to you live from Ecosperity in Singapore, where global leaders, investors, and policymakers are gathering to focus on one of the defining challenges and opportunities of our time: building the infrastructure needed for a more sustainable future.

I'm joined by Salim Samaha, Global Head of Energy at Global Infrastructure Partners, a part of BlackRock, and Heidi Yip, Head of Sustainable and Transition Solutions for the Asia Pacific region at BlackRock. We'll discuss how the infrastructure opportunity is evolving globally, what makes Asia distinct, and where investors are seeing the most momentum and the biggest challenges as the transition unfolds.

Heidi and Salim, thank you so much for joining us on The Bid.

Heidi Yip: Thank you.

Salim Samaha: Thank you for having me.

Oscar Pulido: Well, we're here in Singapore at the Ecosperity event. In fact, if I look over my right shoulder, I can see Marina Bay. Now, I've been to Singapore many times, and I know that Marina Bay is very small, but it's very iconic landscape of Singapore. But for those that haven't been here, and specifically for those who haven't been at the Ecosperity event, which talks about the infrastructure that is needed to build a more sustainable future,

Heidi, maybe just your initial reactions. You've been here on the ground. what are you hearing? What are you feeling?

Heidi Yip: Well, BlackRock's been a close partner with Temasek on Ecosperity and its flagship finance conference on sustainability since 2021. And we've only seen the event grow bigger, more international perspectives over the years, and we've seen a lot more investor interest in coming to the region to collaborate on investment opportunities in Asia. And I got to say, the atmosphere this year is positively electric.

Oscar Pulido: Salim, what about you? what are your reflections so far at this event?

Salim Samaha: So, I come to Singapore a fair bit, but it's my first time at Ecosperity, and I will say it's extremely well attended. People are coming here trying to make things happen, and I've met a lot of great people and had some great meetings that are going to lead to some good things, I believe.

Oscar Pulido: So, let's get a little bit more specific. We want to talk about infrastructure, and we want to talk about how central the energy transition is to that story. So, Salim, maybe when we step back and look globally, how would you describe the phase that we're in today? And when we talk about the energy transition, what does that word transition actually mean today?

Salim Samaha: What we have is blurred lines today, you have significant growth in energy demand, AI, reshoring, and at the same time everything's growing: oil, gas, coal, and clean energy. And clean energy is gaining more market share in the global energy system. and the transition is really one where you're moving to more decarbonized sources of energy over time.

Increasingly, it's the same thing as energy security in many parts of the world. So, diversifying your energy sources means you have more reliable, diversified, energy and it's quite exciting to, uh, see some of the innovation that is happening globally that is going to reshape the global energy system over time.

Oscar Pulido: And Heidi, since we're obviously here in Asia, when you think about, the infrastructure needs for this part of the world, where do renewables rank among the investment opportunities? Salim touched on clean energy, but Curious to hear your view.

Heidi Yip: Renewables in Southeast Asia are essential, but it's only a part of the solution. We see Southeast Asia as one of the fastest-growing energy markets in the world. We have GDP per capita growing at incredible rates, 30% over the last ten years. Energy demand growth has been over 35% over the same period of time. Over the next decade, we expect Southeast Asia on its own to contribute over a quarter of global energy demand growth. So, what we're seeing here is a need for more abundant energy sources. We're talking about building up more energy capacity. It's not just about transitioning old systems. It's about building at scale from scratch - the first time.

So, what this means is when we consider where the system is starting from, it's already very heavily reliant on conventional energy. Coal is still meeting roughly half of the energy demand in Southeast Asia today, natural gas about a quarter. So, the transition here requires us to build new and better at scale. Renewables, especially solar, is increasingly competitive And we're seeing incredible potential here, right? There's an estimated twenty terawatts of untapped solar and wind capacity in the region. So, the binding constraint here is not about power generation or renewables, it's about integration.

So, the real challenge is whether the grid's storage and power markets have the ability to absorb, transmit, and then distribute, this power in a reliable manner. So that's why we see a lot of opportunity shifting towards transmission, towards interconnection, and towards, system flexibility solutions.

So, renewables rank highly, but in Southeast Asia, what will determine value creation is really about the integration, right? The opportunity isn't just about building more renewables, it's building the system that allows them to work.

Oscar Pulido: Right. You need more energy sources, but you also need the infrastructure to support those energy sources. And you mentioned that GDP per capita is growing quite rapidly in this part of the world, so energy demand is growing.

Salim, perhaps to come back to you and to shift to a different part of the world to compare. A lot of the market commentary frames the Western world as backing away from this energy transition. I wonder, in your opinion, is that the right read? Is that what's actually happening? And how does Asia look by comparison?

Salim Samaha: I don't think that's the right framing for it. If I go back three, four years ago, people were not particularly educated on the energy systems because they didn't have to be. They assumed we can transition a system that's been built over a hundred and fifty years almost overnight. And you even had some big companies in the sector think it's going to happen faster than it could.

And where we are today is people understand that this is going to be a longer journey. It's going to require innovation. If you go to Europe. Europe is very committed to decarbonization. They have other things that they have to do, defense spending, but they also have to protect their energy security. And so, there's a lot that is going on in Europe. You go to the US, there's a big need for electricity. It can't all be intermittent, so it's not just about solar and wind.

There's new advanced geothermal that's being developed by companies like Fervo that is going to provide reliable decarbonized energy. There's a nuclear renaissance that is also happening There's a lot of carbon capture which allows the current system to continue working the way it is today but to decarbonize.

So, there's a range of solutions. And even, within the context of the US, you've got policies that are very supportive in all of those areas because it's really more about energy dominance and making sure that it's really an all-of-the-above solution.

On Asia, I think the need for energy security is even more acute. So, you have a big push for even circular economy in Asia to make sure that it's not as reliant on intermittent supply from other parts of the world.

Oscar Pulido: So, one thing that sounds pretty common across regions, if I understood your thoughts correctly, is energy security and having that energy independence, is a big theme, regardless of whether we're talking about the US, Europe or Asia.

Heidi, perhaps to come back to you. Let's talk more about the investment opportunities. How do investors in Asia approach the opportunities in the region?

Heidi Yip: Some investors I guess globally may still view energy transition as a thematic allocation. And APAC allocators actually have to also apply two additional lenses. That's about systems and about development. So, as Salim mentioned, in this region, energy transition is inseparable from energy security, industrial growth, and, affordability, right? Southeast Asia still relies quite heavily on fossil fuels. Eighty percent of the power, primary energy production and seventy percent of electricity generation comes from fossil fuels, even as investments in renewables are accelerating.

So, that context naturally shapes a more pragmatic mindset. The question that investors in Asia aren't having top of mind necessarily is how green is the investment, right? Instead, what they're focusing on is whether the investments improve system reliance, resilience, support energy independence, and also help to improve long-term affordability.

So, we see structural differences in how capital is being deployed as well. APAC allocators are far more likely to look for partnership-driven models, when they co-invest alongside governments, development finance institutions, multilateral development banks, and other strategic partners. This is viewed as a practical way to approach infrastructure and systems build up. This is also reflects the reality of how a lot of the energy infrastructure in Southeast Asia has been developed. It's through, this coordinated approach delivered through public-private partnerships.

For example, initiatives like Financing Asia's Transition Partnership, that's FAST-P, was explicitly designed to use catalytic capital to mobilize private investments into the region. So, what the Singapore Monetary Authority has done is contributed five hundred million USD of catalytic capital with a goal to mobilize up to five billion dollars of private investments to support Southeast Asia's energy transition.

But there is still a gap, right? For instance, the appetite for private markets investments is rising globally. But in APAC, investors often face higher hurdles, in terms of risk calibration and benchmarking investments on, especially on investments that they need to make in the region. So, the key distinction here is this - APAC investors are underwriting systems outcomes, not just asset returns.

Oscar Pulido: Salim, you've been investing in this space for a number of years, and so when you think about investing in the transition and investing in the infrastructure that enables the transition, what does it take to do that in scale? And maybe what are some of the misconceptions that you encounter when you're talking about this theme?

Salim Samaha: I think it's more than capital. You need real capabilities, real, relationships to do that. And increasingly, it's becoming Tougher and tougher to find the qualified workforce to build and operate, these assets because we have massive trends around decarbonization and reshoring, and a significant increase in AI demand and other energy demand.

So, what you need to do is you have to have a very disciplined approach to underwriting. You have to have good procurement, you have to have a good risk mitigation for construction, well-structured contracts that allocate risk appropriately between different counterparties, and then you have to invest ahead of the curve in the labor force in order to make sure that if you run into any issues, they don't delay you and they don't have a cascading effect on your projects.

Oscar Pulido: Right. We often think about different bottlenecks when it comes to investing in the transition, investing in infrastructure. And the labor bottleneck, I think, is a more recent observation for people that they didn't realize perhaps over the last couple of years that there's a human capital requirement as well. I think that's what you're saying, Salim?

Salim Samaha: Absolutely right. And I think for those of us in the energy industry, we've been talking about, a labor force that's getting older and older, and people are not pursuing craft labor. They're pursuing four-year university degrees. But now that the demand is actually accelerating and we need to build a lot of new infrastructure, we're really starting to feel it.

Oscar Pulido: So, Heidi, to come back to you. when you're actually seeing capital get deployed today, what are some of those bottlenecks and those friction points that determine whether a project is going forward?

Heidi Yip: In Asia, what we're seeing is capital being deployed where there are visible demand growth signals, credible policy direction and also infrastructure, solutions that are scalable. So, we're seeing the strongest momentum in grid infrastructure, in storage, and in contracted renewables, particularly where the demand is clear. Electricity demand in Southeast Asia has already tripled over the past two decades, and it's expected to continue to grow four to seven percent, annually, and that's, almost twice the global average.

But the constraint isn't capital. On bottlenecks, it's really about the ability to deploy that capital efficiently. Today, the region invests about $70bn per year in clean energy, but that's only about half of the total $130bn that's required just to stay on track with stated ambitions. And the bottlenecks that we're seeing are really structural in nature. It's about permitting and land access. it's about building up grid connectivity and capacity, uncertainty around offtake and pricing frameworks creates bottlenecks as well.

So, many investments may be viable on paper, but they stall because those enabling conditions aren't in place. So, the real differentiator here is execution. It's not on technology, it's not on capital availability, but in practice, the winners will be the projects that can solve coordination gaps and not just cost curves.

Oscar Pulido: It's clear from, listening to both of you that the global economy. is rewiring. there's a need for energy independence, and there's also the development of AI, which when these two forces are converging, is creating the need for, diversified power sources and infrastructure. So that's obviously a big theme of Ecosperity this week. But if we were to be here five years from now, what would you think we're talking about? what would we be observing? how will the transition have played out five years from now? Heidi, maybe starting with you.

Heidi Yip: What will surprise people most five years from now is how central Asia has become in driving the outcomes of the global transition. And Southeast Asia alone is adding, about the equivalent of urban population the size of Singapore on an annual basis.

And this is going to drive massive sustained demand for infrastructure across power, transport, digital systems. And what this means is that energy transition was never about retrofitting. It's about building right, and scalable, from the first time. And I think we'll also look back and realize that the biggest impact didn't come from breakthrough technologies, but from things like grids, storage systems, system integration, that quietly enable everything else.

And finally, the transition would have been even more uneven and pragmatic than people expect, not because of a lack of ambition, but because countries need to solve the transition in ways that reflect their own growth imperatives and constraints. So, the energy transition won't be linear, but it will be decisive where systems come together. And five years from now, we hope that pragmatism rather than ideology would have driven the biggest reductions in emissions.

Oscar Pulido: Salim, what about you? If we're here five years from now, what are we talking about at that point?

Salim Samaha: I think there's a tremendous amount of very exciting innovation that's happening that people aren't focused on because they're focused on what's immediately ahead of them right now. And I think that's going to create better services, more integrated, cheaper, better. And I think Asia is, one of the key regions where many of these innovations are going to be, coming from. you're going to see autonomous vehicles get deployed in a much bigger way. You're seeing, batteries and long duration storage get a lot better. Material science, with the advent of AI could accelerate significantly. So, we're going to be seeing, things frankly, that we can't even predict sitting here today but I would never bet against technology.

Oscar Pulido: Yeah, the world is changing fast, so five years seems like a long time at the pace that things are evolving. innovation, the role that Asia is going to play in this energy transition. The Bid has been in Asia for the past week. We've actually talked to a number of BlackRock leaders, and one of the key themes is that Asia is becoming more central to a lot of the important investment themes in the market.

So, Heidi and Salim, you've taken us through the infrastructure opportunity and the central role that Asia's playing. Thank you for educating us on this topic and thank you for doing it here on The bid.

Heidi Yip: Thanks very much.

Salim Samaha: Thank you for having me.

Oscar Pulido: Thanks for listening to this episode of The Bid. Don't forget to subscribe wherever you get your podcasts.

<<SPOKEN DISCLOSURES>>

This content is for informational purposes only and is not an offer or a solicitation. Reliance upon information in this material is at the sole discretion of the listener. Reference to the names of each company mentioned is merely for explaining the investment strategy and should not be construed as investment advice or recommendation. For full disclosures, visit blackrock.com/corporate/compliance/bid-disclosures

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