Institute for Climate and Sustainable Cities
ANALYSIS

QUEZON CITY, 30 March 2026 – ​​The Philippines’ declaration of a national energy emergency under Executive Order No. 110 highlights a long-standing reality that can no longer be ignored: heavy reliance on imported fossil fuels exposes the country to global supply and fuel price volatility. The situation also puts the spotlight on the clear and massive opportunity to transform the energy system for our archipelago with locally driven, fit-for-purpose solutions that optimize the abundance of renewable energy (RE) resources with available technology, building a more affordable, reliable, and secure power system for all Filipinos in the on-grid and off-grid areas.

ICSC acknowledges the decisive leadership and whole-of-government effort embodied in President Ferdinand Marcos Jr.’s issuance of EO 110. These measures are necessary to allow the use of government resources to stabilize supply.

Yet, they are not enough. The effects of the crisis brought by the US-Israel war on Iran will be felt long after the situation in the area is resolved, and its lessons must compel us to pursue structural reforms that reduce this perennial vulnerability to global instability and give Filipinos greater control over their energy future.

Our country’s power system was shielded in part from past fuel crises because of early government investments in RE resources such as geothermal and hydropower, which continue to benefit the system today. With the addition of solar, wind, pumped storage hydro, and battery energy storage systems since the enactment of the Renewable Energy Act in 2008, the country is in a stronger position than ever to deploy local solutions and reduce dependence on imported fuels.

To address the energy emergency and transform the system to be more resilient to future shocks and disruptions, action is required across all sectors. The government leads the way through EO 110, adoption of alternative work arrangements, and short-term demand-side measures. These must all be fused into a comprehensive national program on energy efficiency and conservation, and system transformation.

Transport policy must also shift decisively, accelerating electric vehicle adoption for public fleets and expanding mass transit to reduce oil demand.

Short-term interventions to stabilize prices are quick fixes that have unsustainable effects as they leave embedded the structural imbalance: fuel costs which drive electricity price increases are fully and automatically passed on to consumers, instead of risks being shared across the rest of the sector or, more importantly, on those that have the ability to control the risk when fuel is procured. Every external shock is, therefore, transmitted directly to households and businesses, placing sustained pressure on both.

Authorities should review pricing mechanisms to ensure that generators, suppliers, and utilities share in fuel price risks, that efficiency improvements are incentivized, and that consumers are not fully and immediately exposed to sudden price spikes.

The government can help keep electricity costs fair and predictable by sharing risks from fuel price fluctuations and preventing sudden spikes in bills. Consistent, fair and firm oversight of energy markets and enforcement of competition rules will ensure that consumers are adequately protected while the power system remains reliable.

While the country weans itself from its fuel importation dependence, we must also build stronger safeguards against fuel disruptions. This includes expanding strategic petroleum reserves, raising minimum oil inventory levels, and setting clear protocols for energy conservation during emergencies. These measures provide time for orderly market adjustments and reduce the impact of supply disruptions.

Ultimately, the sustainable solution is accelerating the adoption of indigenous and RE solutions. Rooftop solar, in particular, can be deployed quickly and delivers immediate benefits: it lowers electricity bills, reduces demand on the grid, and insulates consumers from global price volatility. Local governments and communities are central to scaling these solutions.

Local government units can aggregate demand, streamline permitting, and deploy solar across schools, hospitals, and barangay halls, while community-based models through cooperatives can expand access and amplify the benefits. National support through concessional financing through government financing institutions, bulk procurement, and the removal of VAT on rooftop solar systems can sustain and accelerate the rollout.

We can choose to view the current energy emergency as a supply problem — but it also presents to us a turning point. The Philippines can continue absorbing external shocks, or it can decisively shift toward a system built on resource abundance, efficiency and shared responsibility. EO 110 provides the urgency and coordination to act. It must now be used to implement reforms that empower people, strengthen local solutions, ensure accountability across the sector, and accelerate renewable energy deployment even beyond the crisis.

ABOUT
The Institute for Climate and Sustainable Cities is a Philippine-based non-governmental organization that advances climate, energy, and low-carbon solutions to enable fair and climate-resilient development at the national and international levels.

The organization also released a statement upon signing of EO 110, reiterating the urgent need for a unified, strategic national approach that prioritizes resilience and long-term development. Read the full statement here.

CONTACT
Sanafe Marcelo, ICSC: media@icsc.ngo, +63 968 886 3466, +63 917 149 5649 

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