Cebu faces power supply gap as demand outpaces capacity

CEBU, Philippines — Cebu’s economic ascent is colliding with an aging power grid, as recurring supply alerts across the Visayas expose a widening gap between electricity demand and available capacity — a mismatch that risks denting one of the Philippines’ fastest-growing regional economies.

The region’s operating reserves fell to roughly 183 megawatts during recent grid alerts, a razor-thin buffer that leaves little room to absorb a plant trip, transmission fault, or unexpected demand spike.

The strain intensified in May, when transmission bottlenecks and tight supply in Luzon curbed the power transfers the Visayas has come to rely on — exposing the risks of a system built to import shortfalls rather than generate its own baseload.

“We need more baseload supply,” Anthony Almeda, president and chief executive officer of the National Grid Corp. of the Philippines (NGCP) told lawmakers at a House hearing on May 26. “Otherwise, red alerts will continue to be a regular occurrence.”

Almeda called on policymakers to adopt a nationwide, resource-adequacy approach to power planning — one that diversifies generation technologies geographically and weans the Visayas off its dependence on Luzon and Mindanao imports, which he said should function as backup, not backbone.

Renewables Outpace Firm Capacity

The imbalance is stark in the project pipeline. The Department of Energy’s (DOE) May 2026 tally shows more than 3,880 megawatts of committed renewable projects in the Visayas, dwarfing about 312 megawatts of committed conventional capacity and roughly 420 megawatts of planned storage.

Yet committed capacity is not operating capacity: permitting delays, financing gaps, land disputes and grid-connection bottlenecks routinely push projects behind schedule, leaving the region’s reserve margins exposed in the interim.

Analysts say the fix isn’t a binary choice between clean and conventional power, but a coordination problem — ensuring generation, storage and transmission investments arrive in step with demand growth, rather than lagging it.

Local Governments step In

With Manila-led planning still catching up, Cebu is drafting its own roadmap.

Governor Pamela Baricuatro earlier said the province will craft a Provincial Energy Master Plan folding in national policy, local priorities and private-sector proposals, aiming to make Cebu “energy-secure, climate-resilient and future-ready.”

The stakes are commercial as much as technical. Cebu’s growth has been powered by manufacturing, tourism, business-process outsourcing, logistics and real estate — sectors highly sensitive to outages.

Carl Cabusas, president of the Talisay Chamber of Commerce and Industry, said the private sector wants execution, not more diagnosis. “We already know the challenge before us: demand is growing faster than available power supply,” he said, urging faster buildout of generation and transmission alongside tighter public-private coordination.

For investors weighing the Visayas against other Southeast Asian manufacturing bases, reliability is becoming as decisive a factor as labor costs or logistics access. Whether the region closes its capacity gap — or continues to lean on strained inter-island transfers — will shape how much of that investment case holds up. — (FREEMAN)