The growing demand for clean energy is reshaping energy markets across the world with calls for innovative and sustainable solutions to ensure energy security and to address climate change.
In the Philippines, given its vast natural resources, renewable energy (RE) has gained prominence as one of the key drivers of a sustainable energy future. As such, industry movers like Manila Electric Company (Meralco), the country’s largest power distributor, have taken serious strides towards the energy transition path.
In a recent energy forum organized by BusinessWorld, Meralco First Vice President and Chief Sustainability Officer Raymond B. Ravelo emphasized the company’s conscious effort to place sustainability at the very core of Meralco’s strategy and operations, and the role of power as a key pillar of its sustainability agenda called Powering the Good Life.
“Power holds our aspiration to provide energy for all, always, as we aim to provide affordable, accessible, reliable, and clean energy to all we serve,” Ravelo said.
Aligned with this thrust, Meralco continuously explores ways to fulfill and secure the country’s current and future energy requirements.
The company continues to proactively pursue energization efforts and as of end-2022, through the Meralco Electrification Program, it achieved 99.98% electrification in its service area, which is home to more than 30 million people.
“As we drive to achieve full electrification, we will be deploying innovative off-grid solutions, including solar home systems and microgrids,” Ravelo said.
“Looking ahead towards a fully electrified archipelago, we need to be very mindful and conscious of the imperatives set forth by UN SDG7, or the push for affordable and clean energy,” he added, referring to one of the United Nations’ Sustainable Development Goals.
Going beyond electrification, Meralco and other Philippine companies have led the way for the utilization of clean energy technologies as a way forward.
The Philippine government aims to increase the share of RE in the country’s energy mix to 35% by 2030 and 50% by 2040 as part of the National Renewable Energy Program.
In line with this, the Department of Energy (DOE), under its Renewable Portfolio Standards (RPS), mandates electricity suppliers to source an increasing portion of their supply portfolio from RE. Currently, the RPS requirement is set at +2.52% per annum.
In compliance with and in support of the DOE’s RPS policy, as of date, the power distributor has contracted 1,880 megawatts (MW) of RE capacity from various suppliers, already breaching its initial target of 1,500 MW.
Through Meralco’s strategic sourcing initiatives, RE is expected to account for 22% of the distribution utility’s supply portfolio by 2030, and 18% of Meralco’s retail electricity supplier, MPower, by 2025.
This will eventually allow the company to reduce its total carbon emissions by 15% vis-à-vis its projected baseline 2030 emissions.
ACCELERATING RENEWABLE ENERGY BUILDOUT
To help the country achieve a sustainable energy future, Meralco, through its power generation arm Meralco PowerGen Corporation (MGen), continues to develop greener capacities in response to the country’s growing energy needs.
MGen has committed to invest at least P18 billion to accelerate its RE buildout in line with One Meralco’s long-term sustainability strategy. The investment will cover RE capacities from solar and wind that the company, along with its partners, aims to build through 2030.
Through its renewable energy unit MGen Renewable Energy, Inc. (MGreen), MGen intends to ramp up its attributable RE capacity to 1,500 MW with investments in more and larger green energy projects.
Currently, MGreen has an RE portfolio that includes BulacanSol’s 55MWac solar plant in San Miguel, Bulacan in partnership with Powersource Energy Holdings Corporation; Nuevo Solar Energy Corporation’s 68MWac solar farm in Currimao, Ilocos Norte with Vena Energy’s Pasuquin Energy Holdings Inc., and PH Renewables, Inc.’s (PHRI) 75MWac solar farm in Baras, Rizal with Mitsui & Co.’s Mit-Renewables Philippine Corporation.
PHRI has completed the commissioning tests for Phase 1 of its project involving 67.5 MWac which is expected to declare commercial operations within Q4 2023. The Phase 2 of the project is targeted to be operational by mid-2024.
With these huge strides towards a more sustainable energy future, MGen is pursuing more projects utilizing RE in line with One Meralco’s target to reduce its direct emissions by 20%.
These include two solar projects – the 49MWac solar plant in Cordon, Isabela; and the 18.75 MWac solar plant in Bongabon, Nueva Ecija, which are among the winning bidders in the DOE’s second round of Green Energy Auction Program (GEAP).
BEYOND THE GRID
Aside from expanding its renewable energy portfolio, Meralco is also one of the leading supporters of the country’s important shift towards sustainable transportation.
Earlier this year, Meralco incorporated Movem Electric, Inc., in line with its plans to be a major player in the growing electric vehicle (EV) industry and to be part of the solution for cleaner and greener transportation.
Through its Green Mobility Program, Meralco also aims to electrify at least a quarter of its entire fleet by 2030. Meralco has been converting its internal combustion engine fleet vehicles into electric-powered cars, vans, pick-up trucks, and motorcycles. To support these EVs, the power distributor has also installed station chargers in strategic locations across its franchise area.
Since the launch of its overarching sustainability agenda in 2019, Meralco has consistently earned recognitions for its sustainability programs and performance.
Meralco has sustained its strong environmental, social, and governance (ESG) performance as it maintained its all-time best ratings in global indices. The power distributor secured a 3.2 ESG score for the third consecutive year from Financial Times Stock Exchange Russell ESG Ratings—performing better than Philippine and energy sector averages. It also received a rating of BBB for two consecutive years from MSCI, driven by strong performance in RE opportunities and water management.
Earlier this year, Meralco also marked the successful planting of over two million trees across the country in time for Earth Day 2023. This significant milestone, under the One for Trees Program led by the One Meralco Foundation, brought One Meralco closer to its target to nurture five million trees by 2026.
All these efforts are a testament to Meralco’s commitment to sustainability as it continues to empower communities with cleaner and greener energy for a brighter future.
“Meralco remains one with the government and the private sector in ensuring long-term energy security, while fully supporting the government’s push to advance the country’s low-carbon energy transition with strengthened policies that include higher RPS requirements, foreign ownership liberalization of RE projects, and priority dispatch of RE plants,” Meralco Chairman and CEO Manuel V. Pangilinan said.
“We also reaffirm our commitment to deeply embed sustainability in our strategy and operations, while embarking on a just, orderly, and affordable transition to clean and earth-friendly energy. Our Long-Term Sustainability Strategy maps out this important decarbonization plan beginning today through 2050,” Mr. Pangilinan added.
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