Powering the Philippines’ energy transition

 Powering the Philippines’ energy transition

By Bjorn Biel M. Beltran, Special Features Writer

Energy has long been a topic of conversation when it comes to envisioning the society of the future. Advancements in energy have historically led to massive surges in technological progress, with the most notable being the first industrial revolution in which the use of fuel sources like coal and steam power transitioned mankind from an agrarian and handicraft society to one dominated by industry and machine manufacturing.

Many leaders are pushing for a new, similar transition today. In November last year, the United Nations Secretary General António Guterres issued a global road map to achieve a radical transformation of energy access and transition by 2030, while also contributing to net zero emissions by 2050.

“We face a moment of truth,” Mr. Guterres said. “Close to 760 million people still lack access to electricity. Some 2.6 billion people lack access to clean cooking solutions. And how we produce and use energy is the main cause of the climate crisis. We must solve these challenges this decade. And we must start today. With the global road map at hand, we can together realize the potential of energy as a crucial enabler for the achievement of the Sustainable Development Goals and the objectives of the Paris Agreement, ensuring a more prosperous, equitable and sustainable future for people and the planet.”

As the effects of climate change continue to be felt worldwide, exacerbated by the  impact of the COVID-19 pandemic, more people are beginning to realize the critical significance of transitioning to cleaner, more sustainable ways of living.

As a signatory to the Paris Agreement on Climate Change, the Philippines has pledged to cut its greenhouse gas emissions to a 75% reduction by 2030. Among such initiatives towards reaching this goal are the Department of Energy’s (DoE) various programs towards facilitating energy transition, including the National Renewable Energy Program (NREP).

The NREP aims to realize the country’s renewable energy goals by institutionalizing a comprehensive approach to address the challenges and gaps that prevent and/or delay wider application of RE technologies in a sustainable manner; and outlining the action plans necessary to facilitate and encourage greater private sector investments in RE development.

Specifically, the NREP intends to raise the country’s geothermal capacity by 75.0%; hydropower capacity by 160%; deliver additional 277-MW biomass power capacities; attain wind power grid parity with the commissioning of 2,345-MW additional capacities; mainstream an additional 284-MW solar power capacities and work towards achieving the aspirational target of 1,528 MW; and develop the first ocean energy facility for the country.

Other plans such as the 2040 Philippine Energy Plan (PEP) are also made to usher in a new era for Philippine energy. The PEP was designed to increase the production of clean and indigenous sources of energy to meet the growing economic development of the country; decrease the wasteful utilization of energy through the use of energy efficiency tools and strategies; and ensure the balance between the provision of reliable and reasonably priced energy services, support for economic growth, and protection of the environment.

“The Philippine energy sector has witnessed unprecedented times over the past two years mainly due to the impact of the COVID-19 pandemic. The country’s energy woes have intensified due to declining and unstable gas supply from Malampaya field, resulting in a need for an immediate LNG supply solution. This has evidently led to changes in both energy supply mix and consumption patterns across various sectors,” Karthik Sathyamoorthy, president of AG&P LNG Terminals & Logistics, told BusinessWorld in an e-mail.

“With the economy slowly recovering and getting back to its pre-pandemic levels, I expect the DoE 2040 Philippine Energy Plan to go full swing with the country’s aspiration to fast-track clean energy fuels such as Liquefied Natural Gas (LNG) and renewables. DoE forecasts Natural Gas (NG) from LNG imports to account for 40% of the power generation by 2040 that is equivalent to 17 MTPA LNG requirement for power generation in the country.”

With the Malampaya gas field, which supplies 30% of Luzon’s energy, expected to be depleted by 2024 alongside the fact that the country also has a growing population with the highest electricity costs in Southeast Asia, Mr. Sathyamoorthy pointed out that the need to establish energy security, reliability, and affordable power has never been higher.

“In this regard, I foresee continued focus by both public and private sectors for the industry to move away from conventional energy sources to cleaner alternatives such as natural gas and liquefied natural gas that will play a crucial role in energy transition in the country,” Mr. Sathyamoorthy said.

“We at AG&P expect that the Philippines’ energy industry will transform itself into a more robust, globally connected, and clean energy driven segment. Combined with gas power’s ability to stabilize the electric grid, LNG opens the door to more renewables, which are inherently volatile. Thus, LNG in combination with renewables has a net decarbonizing effect. Hence, we are actively pursuing LNG/NG supply initiatives that will also support the growth of renewables and usher in reliable and affordable power supply across the various downstream value chain segments such as transport, commercial and industrial sector,” Mr. Sathyamoorthy added.