THE PHILIPPINES must build an additional 20 gigawatts (GW) of renewable energy (RE) facilities within a decade to hit its target of 35% clean energy in the power generation mix, according to listed power firm AC Energy Corp.
In a briefing Tuesday, AC Energy President and Chief Executive Officer Eric T. Francia said the company projects that the Philippines can hit 35% RE at that level of new construction, a major step up from the 2019 level of 7.4 GW.
Mr. Francia said the target is achievable if the government increases its yearly renewable portfolio standards (RPS) increment to 2.52% from the current 1%. The RPS requires distribution utilities and retail electricity providers to source an agreed portion of their power supply from eligible RE facilities.
The new construction will require investment of over $20 billion, excluding those related to battery energy storage, he added.
“Assuming that we really get to that 20 GW of renewable build-out over the next decade (and consider that) 1 MW of renewables averages around 1 million dollars… the rough estimate here is we should be seeing well over $20 billion worth of investment on renewables alone — not including storage — and create over 50,000 jobs in direct employment,” he said.
He also believes that solar technology will likely be the main driver of renewables growth in the Philippines over the period since it is cost competitive compared to coal and gas and can produce power during peak demand.
In 2020, RE sources comprised 29% of the installed capacity mix, down from 34% in 2009, a year after the Renewable Energy Act was signed into law, according to the Department of Energy’s Electric Power Industry Management Bureau.
Mr. Francia said the government’s RE policies such as the revised RPS, RE certificate market, green energy option program and reserve market will support the 35% target, which the DoE previously called “aspirational.”
AC Energy, the listed energy platform of the Ayala group, hopes to be the largest listed renewables group in Southeast Asia, with a target of 5,000 MW in renewables capacity by 2025. The company, which also operates in Vietnam, Indonesia, India, and Australia, currently has attributable capacity of around 2,600 MW. — Angelica Y. Yang