power and water

No more new coal plant applications under latest PH energy policy

Aika Rey

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'We are also pushing for the transition from fossil fuel-based technology utilization to cleaner energy sources to ensure more sustainable growth for the country,' says Energy Secretary Alfonso Cusi

The Philippines is no longer accepting new applications for greenfield coal power plants, under the latest policy announced by Energy Secretary Alfonso Cusi.

Cusi said the moratorium on endorsements is based on the latest assessment by the Department of Energy (DOE) which highlighted the need to shift to a “more flexible power supply mix” that would help build a more sustainable power system in the country.

“While we have initially embraced a technology-neutral policy, our periodic assessment of our country’s energy requirements is paving the way for innovative adaptations in our policy direction,” Cusi said in a recorded speech at the 2nd Global Ministerial Conference on System Integration of Renewables on Tuesday, October 27.

In September 2019, Cusi had blocked proposals to ban coal unless the Philippines meets its need for energy security.

However, the latest review, according to Cusi, bats for the entry of “new, cleaner, and indigenous” technological innovations.

Cusi also announced a relaxation of foreign ownership for large-scale geothermal projects, strengthening the Philippines’ resolve for renewable energy.

“I am determined to accelerate the development of our country’s indigenous resources. We are also pushing for the transition from fossil fuel-based technology utilization to cleaner energy sources to ensure more sustainable growth for the country,” he said.

It is unclear how many coal power plant applications will be affected by the latest DOE policy. The new policy does not cover applications that have already been endorsed or have secured the needed permits.

In 2019, the country’s power generation mix was dominated by coal with a share of 54.6%. Without changes to the power mix, a Fitch Solutions report estimated that coal would have dominated the mix by 60.2% in 2029.

The new policy also comes as the DOE prepares for the approval of nuclear power in the country’s energy mix. In a previous budget hearing, the energy department said it is expecting a decision from President Rodrigo Duterte in December.

‘DOE cannot stop here’

Energy groups welcomed the new policy that would be instrumental in pushing the Philippines to access clean energy in the long term.

The Center for Energy, Ecology, and Development (CEED) on Tuesday said Cusi’s announcement would block at least 10.7 gigawatts (GW) of coal in the pipeline.

“[T]he DOE cannot stop here. If it is to make up for the years it stood by its so-called ‘technology-neutral’ policy, it has to follow up with phase-out plans for the currently installed 9.8 GW of coal in the country,” CEED added.

“Without this, the suffering of coal-affected communities, soaring electricity prices, and fossil fuel pollution would continue to proliferate.”

The group Power for People (P4P) supports the DOE’s move. However, it said it has reservations on how the new policy would affect power rates nationwide.

“The long-term benefits of coal would be complemented by decisive action on the part of the government to also address the short-term effects of the bill shock which happened during the enhanced community quarantine period,” said P4P. – Rappler.com

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Aika Rey

Aika Rey is a business reporter for Rappler. She covered the Senate of the Philippines before fully diving into numbers and companies. Got tips? Find her on Twitter at @reyaika or shoot her an email at aika.rey@rappler.com.