Philippines to Allow 5 GW New Coal Capacity Under Energy Transition Policy

The Department of Energy (DoE) is set to introduce a coal transition policy that will accommodate up to 5 gigawatts (GW) of new capacity from coal-fired power plants not covered by the current moratorium, according to Energy Undersecretary Rowena Cristina L. Guevara. This new capacity is intended to fill the gap left by aging and deteriorating coal-fired power plants that can no longer generate electricity at full capacity. "We have to consult with the industry because they are an integral part of the transition plan," Ms. Guevara told reporters, indicating that the policy will also include a work plan governing the development of coal-fired power projects. Coal remains the backbone of the Philippines’ power generation mix, accounting for around 60% of total generation and providing much of the country’s baseload capacity. Simultaneously, the Philippines is pursuing a transition to renewable energy (RE), targeting to increase its share to 35% by 2030 and 50% by 2040. The government imposed a moratorium on the development of new coal-fired power plants in 2020 to make room for more RE and build a more flexible power system. Last year, the DoE clarified that projects exempt from the coal ban include those already committed for expansion, or indicative projects with substantial accomplishments. Ms. Guevara stated that approximately 3 GW to 5 GW of additional coal-fired capacity from these exempted projects could still be brought online. "We have to fulfill our RE targets. But at the same time, energy security has to take priority," Ms. Guevara emphasized, stressing the importance of ensuring that the shift toward cleaner energy does not leave consumers vulnerable to sudden power interruptions. As of August 24, DoE estimates anticipate the entry of 835 megawatts (MW) of capacity from coal-fired power projects through 2028. In May, the DoE had stated that there was no compelling need to suspend or lift the coal moratorium amid concerns over power supply security rising from geopolitical disruptions out of the Middle East.