ASIDE from upgrading the country’s transmission grid, the administration of President Ferdinand R. Marcos Jr. must also address its energy security capabilities to ensure investors will park funds in the Philippines
Stratbase ADR Institute President Victor Andres C. Manhit pointed out last Sunday that the government should work hand-in-hand with the private sector in pursuing a long-term energy exploration and transition objective, and open itself to domestic and foreign investments in infrastructure.
“This includes building more power plants, modernizing the electricity distribution system, expanding transmission networks, and enhancing energy storage,” Manhit was quoted in a statement as saying.
“Energy cost and stability are a significant determinant of the level of interest of businesses to set up shop in the country. Investments mean jobs, income, spending power, technology transfer, and, ultimately, economic activity and growth,” he added.
Manhit emphasized that investment-driven growth will minimize the country’s vulnerability to external developments and enable itself to better assure Filipinos of a better quality of life.
“But this type of growth can only take place with energy security already in place. Thus, it is important that we address costs, stability, accessibility, and reliability of power anywhere in the Philippines at the soonest possible time,” the analyst said.
Meanwhile, the country’s energy security roadmap received a huge boost when Manila and Washington signed on November 16 several agreements on nuclear energy cooperation that is quite important for the Philippines in pursuing lower energy costs. Right now, power rates in the Philippines are the highest in Asia next only to Japan, according to Manhit.
“President Marcos has set an ambitious goal: cutting the Philippines greenhouse gas emissions by 75 percent by 2030 and increasing the production of clean energy so that 50 percent comes from renewable sources by the year 2040. The United States is committed to working with the Philippines so that it can meet those targets—using platforms like the very first US-Philippines Energy Policy Dialogue, which we hosted in Seattle back in August,” US State Secretary Antony Blinken said during the signing ceremony held in San Francisco, California.
Meanwhile, InfraWatch PH Convenor Terry Ridon stressed the important role of the Energy Regulatory Commission (ERC) in crafting and implementing pro-consumer policies.
“The ERC should tighten oversight on the completion of these critical infrastructure projects, which would hopefully strengthen the electricity value chain and prevent higher electricity cost for consumers,” Ridon said during a forum organized by the Stratbase ADR Institute.
Ridon has enumerated various ways to address the critical issues surrounding the Philippine energy grid.
These include ensuring the independence of regulatory agencies, developing clear and specific standards and performance metrics for energy companies to follow, and harsher penalties for non-compliance to these standards.
“This will serve as a strong deterrent for companies considering cutting corners or violating regulations. To further promote accountability, compliance data should be publicly accessible to promote transparency. This will allow the public to be informed about the operations of energy companies and their adherence to regulations,” Ridon explained.
The InfraWatch PH Convenor emphasized that the commitment of the National Grid Corporation of the Philippines (NGCP) to invest P300 billion in grid improvements is a step in the right direction.
“However, juxtaposed with the delayed implementation of projects critical to the integration of renewable energy, this figure is not as reassuring as it might initially appear,” Ridon said. “As the country moves toward renewable energy sources, the speed and efficiency with which the NGCP operates will be crucial in determining the success of this transition.”
Philippine Business for Environmental Stewardship Secretary-General Felix Jose M. Vitangcol concurred with Ridon saying upgrading the grid infrastructure to accommodate the increasing penetration of renewable energy would allow it to become “more agile, adaptive, and robust.”
“It will boost economic development and promote a conducive investment-led sustainable environment for businesses and the like. This then results in job creation and better public services for industries like telecommunication and digital services,” he explained.
The Department of Energy earlier said that it aims to increase the share of renewable energy in the power generation mix to at least 35 percent by 2030 and 50 percent by 2040.