Moratorium on new coal plants to guide investors into RE

MANILA, Philippines — The recently declared moratorium on endorsements of new coal power plant projects is seen to guide energy investors into the renewable energy sector, an official of the Department of Energy said.

In a webinar, Energy Undersecretary Felix Fuentebella said the discussion on the moratorium of the endorsement of coal plants is not new, emphasizing that this is in line with improving the reliability of the country’s power system.

“It is clear that we need to address the clean energy scenario, but also to look into the reliability of our system for a more flexible generation into the system,”Fuentebella said.

He said coal is not seen as flexible energy source compared to other sources such as a hydro and geothermal, among others.

Fuentebella said that when the pandemic started, there were even more power generators looking at the option to shut down some of their coal plants.

“So we said, instead of many more applying for coal, why not already guide investors that look into flexible generation into renewable energy development because renewable energy development and flexible generation go hand in hand,”Fuentebella said.

Energy Secretary Alfonso Cusi earlier declared the moratorium on the endorsement of new greenfield coal power plants, prompted by the DOE’s periodic assessment of the country’s energy requirements, which revealed the need for the country to shift to a more flexible power supply mix.

The DOE said that a more flexible power supply mix would help build a more sustainable power system that would be resilient in the face of structural changes in demand and would be flexible enough to accommodate the entry of new, cleaner, and indigenous technological innovations.

Data from the DOE shows that in 2019, coal accounted for 54.6 percent of the country’s power generation mix. This was followed by natural gas with a 21.1 percent share.

Renewable energy sources geothermal and hydro accounted for a 10.1 percent and 7.6 percent share, respectively, while other renewable energy accounted for 3.1 percent. Oil had the smallest share at 3.5 percent.

Apart from the moratorium Cusi also announced that the Philippines is now allowing 100 percent foreign ownership in large-scale geothermal exploration, development, and utilization projects.