Asia’s biggest power utilities are already losing $6.3 bn a year to climate-related hazards, a new analysis shows.
Losses could rise 33% by 2050 without deep emissions cuts and major investments in resilience.
Heat, extreme rainfall, tropical cyclones and flooding are driving escalating damage to power assets.
Coal-fired plants face acute risks from water scarcity, storm surges and efficiency losses in extreme heat.
Report urges utilities, governments and investors to strengthen adaptation, disclosure and cross-border resilience planning.
Asia’s largest electricity utilities are already facing $6.3 billion (Rs 53,915 crore) in annual losses from climate-related hazards — a figure that could rise by 33 per cent by 2050 without deep emissions cuts and rapid investments in resilience, analysis by the network of institutional investors Asia Investor Group on Climate Change (AIGCC) and research initiative Morgan Stanley Capital International (MSCI) Institute has found.
Drawing on asset-level modelling of 2,422 power generation assets owned by 11 major utilities across the region, the Asia’s Powerhouses at Risk report warned that climate impacts are no longer a distant scenario but a present and escalating financial burden. Beyond the direct hits to balance sheets, interruptions to power supply are expected to trigger billions more in lost revenue and economic damage across industries and households that depend on stable and affordable electricity.
Rising heat and heavier rainfall emerged as the most chronic threats, while tropical cyclones and flooding are expected to inflict severe acute damage. The report highlighted the particular vulnerability of coal-fired power plants, which rely heavily on water for cooling and are frequently located along coastlines. These sites face combined risks from water scarcity, low river flows, storm surges and flooding, alongside sharp drops in efficiency during extreme heat.
While utilities recognise these risks, action remains limited, the assessment showed. Of the eight companies that disclosed forward-looking adaptation plans, none reported adaptation-related capital or operational expenditure, and only two set measurable targets.
The utilities facing the highest average annual losses are India’s NTPC Ltd (formerly National Thermal Power Corporation), Malaysia’s Tenaga Nasional and Indonesia’s PT Perusahaan Listrik Negara (PLN). When grouped by jurisdiction, the estimated impact on listed companies’ market capitalisation ranges from 3 per cent to 32 per cent.
The analysis has highlighted that climate hazards are not a distant threat — they’re already imposing billions in costs on Asia’s energy companies and their customers, AIGCC Chief Executive Rebecca Mikula-Wright said in a statement. “By embedding resilience into planning and investment decisions, we can protect critical infrastructure, safeguard communities, and ensure reliable energy for decades to come.”
Linda-Eling Lee, founding director of the MSCI Institute, added: “Assessing physical risk demands a location-specific lens that distinguishes asset-level vulnerabilities and enables targeted resilience strategies. For owners and operators of critical infrastructure, addressing these localized risks is essential for safeguarding long-term value and ensuring continuity of energy systems.”
Quantify and disclose physical risk impacts: Conduct asset-level, forward-looking assessments detailing assumptions, scenarios and financial implications.
Work with governments on resilience: Align protection standards, coordinate adaptation investments and map interdependent risks.
Embed adaptation into transition plans: Integrate resilience into decarbonisation strategies and capital allocation, with board-level oversight.
Strengthen corporate resilience disclosures: Require ISSB-aligned reporting on asset-level risks, financial impacts and planned adaptation measures.
Integrate utility risks into national adaptation plans: Define minimum resilience standards and coordinate financing mechanisms.
Address regional and systemic risks: Use platforms such as ASEAN to support cross-border planning, data sharing and blended finance.
Engage on adaptation governance: Encourage boards to prioritise resilience and support system-wide collaboration.
Demand greater climate-risk transparency: Push for disclosure of scenario assumptions, financial impacts and resilience-related capex and opex.
Tailor engagement to asset-level exposure: Evaluate whether companies’ risk assessments and planned investments reflect the scale of their vulnerabilities.