The Philippines is gearing up to meet its renewable energy goals by tapping into offshore wind power through a green energy auction programme, but the transition will be costly, cautioned energy secretary Sharon Garin.
Speaking on a panel at the Net Zero Carbon Alliance conference on Thursday, Garin said the country’s ramping up of its offshore wind capacity would require a massive buildout of port facilities, given that there are only two operating ports now across the archipelago. Proper port facilities ensure the smooth transporting, installation and maintenance of offshore wind turbines or wind farms.
“We will need more [ports] in the future, so that will cost us. Transition is expensive. It’s not free,” Garin told the audience of about 500 representatives from the government and corporate sector.
The fifth round of the Green Energy Auction Programme (GEAP) set for the end of the year will be dedicated to offshore wind, and is estimated to add 3.3 gigawatts (GW) of new capacity to the country’s energy mix, with energy delivery slated to begin between 2028 and 2030.
The GEAP was kickstarted in 2022 to make the procurement of renewable energy supply in the Philippines a competitive process. It is one of the policies put in place to help the country achieve the goals set under its renewable energy plan which aims to achieve a 50 per cent renewable energy target by 2040.
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We will need more [ports] in the future, so that will cost us. Transition is expensive. It’s not free.
Sharon Garin, secretary, Department of Energy
In June, the Department of Energy (DOE) also released a roadmap for offshore wind projects to ensure that permit bottlenecks do not stall the country’s push to realise more than 178GW of its potential capacity.
Philippine offshore wind capacity is expected to grow from the current early-stage 67GW pipeline toward operational capacities ranging from around 8.5 GW by 2034 and to as much as 50GW by mid-century, according to latest estimates by international trade association Global Wind Energy Council (GWEC).
Financing offshore wind in the country may be done by sharing the risk of funding, suggested a new report by GWEC. It highlighted risk-sharing mechanism examples such as adjusting tariffs to inflation to protect investors from price fluctuations that could affect revenue, gaining more government support to lessen political and regulatory risk, as well as obtaining concessional financing from development banks.
Other Asia Pacific governments are also helping to curb risks for investors in offshore wind. South Korea has passed a bill aiming to create a “one-stop shop” for offshore wind projects to simplify site selection and permitting and licence procedures. Last year, Japan began issuing climate transition bonds and set a target of providing 20 trillion yen (US$140 billion) worth of support for the green transformation, while Vietnam has ramped up its offshore wind ambitions through its updated national power plan.
‘Not yet ready for export’
Despite the potential of offshore wind in the country, it is “too early” for it to contribute to the regional power grid, said Garin on the same panel.
Ports in areas like Mindoro, Panay, Batangas are being studied so that they can be repurposed to support the offshore wind energy industry. However, until these upgrades are completed, excess renewable energy cannot yet be exported to neighbouring countries through the Asean Power Grid.
The Port of Batangas in Sta. Clara, Batangas City is one of the ports being studied to advance the development of the country’s offshore wind energy projects by modernising its infrastructure. Image: Yodisphere
Garin noted that the DOE has received “many proposals” for it to export its offshore wind energy, including from Singapore.
Singapore is part of the first multilateral cross-border electricity trade involving Asean countries established in 2022. The Lao PDR-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP) showed that cross-border trade was technically and commercially feasible, with about 100 megawatts (MW) of renewable hydropower imported from Laos to Singapore through Thailand and Malaysia using existing interconnections.
“There are too many geopolitical complications but there is potential [to export energy to Singapore]. We need legislation and policies [in place],” said Garin.
