QUEZON CITY, November 26, 2022 – As renewable energy (RE) technologies have become more efficient and affordable, the reality of energy storage systems (ESS) fills the gap that constrains the increase of RE’s share in the power generation mix of the Philippines. With ESS, the variability of RE becomes a non-issue and 24/7 power with renewables is now possible.

This was the clarion call issued yesterday by leading business analysts tracking energy trends in the country and Southeast Asia.

“Developers recognize that they have to place their bets today. Coal is out of the picture in the next five to 10 years because of this whole eye-opening event of the volatile fossil fuel costs, so it makes sense to have power sources that you can rely on. As long as your projections are correct and you are putting your assets in the right place, you can place your bets accordingly and provide consistent 24/7 power from renewable energy,” said Matthew Carpio, transaction advisory head of Climate Smart Ventures, in the third and final installment of the “Pilipinas: Aspire, Rise, Sustain” webinar series this year.

Power sector players ACEN and Aboitiz Power have already been leading in solar ESS deployment, said Carpio. He added, ESS is critical to retiring coal and crucial to ensuring the Philippine grid can absorb more renewable energy sources, which happen to be more affordable, secure, and reliable compared to fossil fuels such as coal, bunker, and diesel. As an archipelagic country, this is true for unserved or underserved small island grids and off-grid areas, as well as main island grids.

Carpio explained, “Renewable energy and ESS applications in small island grids are already very competitive, and it is also projected that, with the right policies in place, RE and ESS will also be cost competitive for 24/7 operations in on-grid areas by as early as 2027 or sooner. If you’re looking to grow your capital, ESS and RE are the right investment landing zones.”

In 2021, the Department of Energy (DOE) pushed to increase the share of RE in the country’s power generation mix by 35 percent in 2030, and 50 percent in 2040. To achieve this target, the DOE said it must increase the annual minimum increment of its Renewable Portfolio Standards (RPS) from 1 percent to 2.52 percent beginning 2023, said Jonathan Teodosio, senior science research specialist of the DOE.

Teodosio added, “The increase in the annual RPS percentage opens more opportunities for developers to invest in RE power projects through the Competitive Selection Process (CSP), Green Energy Option Program (GEOP), and the Green Energy Auction Program (GEAP).”

Apart from renewable energy developments, energy efficiency methods are also crucial in future-proofing national and global economies. Citing the International Energy Agency, Carbon Trust senior associate Kalyani Basu said energy efficiency accounts for 38 percent cumulative emissions reductions by 2050 and has the potential to reach USD 550 billion worth of annual investments in the 2030s.

Fast-tracking the energy transition is vital in the climate agenda of the Philippines and Southeast Asia. This was highlighted in the discussion by The Climate Reality Project Philippines branch manager Nazrin Castro and Institute for Climate and Sustainable Cities (ICSC) project coordinator for Clean, Affordable and Secure Energy for Southeast Asia (CASE) Angelika Marie David.

In addition, they stressed the urgent need to shift the country’s climate agenda towards building robust community ownership for climate action anchored on sustainable development and long-term resilience. “While we are prioritizing climate adaptation, mitigation efforts must arise and decarbonization will become a co-benefit,” said Castro.

Since 2019, the “Pilipinas: Aspire, Rise, Sustain” webinar series has supported corporate directors and industry leaders in creating sustainable and inclusive development practices, said Atty. Pedro Maniego Jr., trustee of the Institute of Corporate Directors (ICD) and senior policy advisor of ICSC.

“The private sector, especially us corporate directors and executives, must play important roles in addressing climate change and accelerating the country’s transition to reliable, efficient, secure, and affordable power,” Maniego added.

 

NOTE TO THE EDITOR

“Pilipinas: Aspire, Rise, Sustain” is a three-part webinar series organized by ICD, with ICSC and The Climate Reality Project Philippines. It is certified by the Securities and Exchange Commission (SEC), as participation in this webinar meets the recommended best practices for continuing directors’ education prescribed by the commission. For more information, visit https://www.icd.ph/webinars-15/pilipinas-aspire-rise-sustain-webinar-series. 

ABOUT

The Institute of Corporate Directors, is a non-stock, not-for-profit organization dedicated to the professionalization of Philippine corporate directorship by raising the level of corporate governance policy and practice to world-class standards.

The Institute for Climate and Sustainable Cities is an international climate and energy policy think tank group based in Quezon City promoting climate resilience and low carbon development.

The Climate Reality Project Philippines is the country chapter of The Climate Reality Project, an organization that aims to catalyze a global solution to the climate crisis by making urgent action a necessity across every sector of society.

CONTACT

AC Dimatatac: media@icsc.ngo, +63 998 546 9788, +63 917 149 5649
ICD: communications@icd.ph

###