Renewable energy is in no short supply in the Philippines and its government has big plans to ensure it becomes a regional leader over the coming years.
Its population, in addition to the planet, would be huge beneficiaries of a lower cost, more sustainable system; the Philippines is the second most expensive country for electricity in South East Asia.
The establishment of the Energy Investment Coordinating Council and Legislation passed in 2017 aimed to reduce bureaucracy and make things smoother for renewable energy developers.
The country, with a population of over 100 million, already has around 15 large dams in operation and many others around the country under construction - including Kaliwa dam which is designed to withstand an 8.0 magnitude earthquake.
Ambitious long-term goals have been set under the Philippine Energy Plan for the years 2017 to 2040, a commitment to utilising more of the country’s natural resources including hydro, solar and wind, and to move away from a reliance on imported fossil fuels. With an abundance of water, hydro is key, not only with ocean but river and rainfall sources.
According to Department of Energy (DOE) data, as of June 2017, renewable energy plants supplied about 7,038 MW of installed capacity in the country, the equivalent of 32.5% of the national output of 21,621 MW. With the addition of the new hydropower facilities it will push the hydropower contribution to the country’s renewable energy percentage well over its current 51.7%. The intention is to raise installed renewable energy capacity to at least 20 GW by 2040 according to the Renewable Energy Roadmap 2017-2040.
Crippling energy shortages and a lack of investment, piqued foreign interest as early as 2007, around six years after privatisation, with the $530mn sale of the Magat hydroelectric plant, a 360-megawatt asset in northern Luzon. The sale was to a joint venture between Norwegian renewable energy company SN Power Invest, which had already been working in other deregulated markets, and local company, Aboitiz Equity Ventures. It was the trigger for many more subsequent deals as foreign investors came on board, including International Finance Corporation, investing into the country’s renewables, hydro power in particular.
In June 2019, the San Miguel Corporation (SMC) set out plans to complete 1,200 megawatts (MW) of mixed renewable energy projects by 2024 as it ramps up its clean energy portfolio, with solar, wind and hydro. The company has solar farms across the Philippines with four wind projects and two hydro. Last year, the company announced plans to reach 10,000 MW of new renewable energy capacity in the next 10 years.
GE, the global industrial company, is looking into hydropower and battery storage in the Philippines, and in particular at the rehabilitation of the country’s oldest facility, the Agus hydroelectric power plant. With an installed capacity of 728.1MW, the plant’s rehabilitation could provide vast amounts of energy for the country. The rehabilitation project hopes to extend the plant’s use, which was commissioned in 1953, by another 30 years, in addition to increasing reliability and availability.
This move into more reliable power is vital for the country’s growth. According to the International Energy Agency, as of 2013, 21 million Filipinos still did not have access to reliable energy services. Addressing this gap would have a positive impact on economic growth, and reforms in the energy industry would positively impact health and education as well.
The potential for economic change is huge. The Balog-Balog Multipurpose Project (BBMP) in Tarlac may be one of the country’s most expensive irrigation projects, running into billions of dollars for the Philippine government, but the storage dam could transform the lives of local farmers. When the project is fully completed, it will irrigate 34,410 hectares and will serve at least 23,000 farmers covering 10 municipalities. It is projected to increase the cropping intensity within the service area from 24% to 200%, directly improving crop production and farmers’ income.
With a storage capacity of 560 million cubic meters which can mitigate flooding in low-lying areas and provide inland fish production within the affected families, the mega dam is an economic power house for the rural communities in addition to the hydropower aspect which is set to generate 43.5MW of power.
So there is much to do, but the country is well on its way. The legislation is in place and interest from foreign investment is strong. The country could even become a regional pioneer to transform the face of renewable energy and in turn, its own economic fortunes.
If you have any questions
