The Department of Energy (DoE) will no longer accept new endorsement applications for the construction of greenfield coal power plants, pending a review of the country’s energy needs. In a statement on Tuesday, Energy Secretary Alfonso Cusi said the DoE’s the periodic assessment of the country’s energy requirements prompted them to declare a moratorium on endorsements for greenfield coal power plants. Greenfield coal plants refer to those power facilities that are yet to be constructed.
In a message to reporters, Energy Undersecretary Felix William Fuentebella said the moratorium covers new applications and the ban will last until such a time the Energy department determines the need for additional supply from baseload plants or plants that provide uninterrupted power supply.
“Actually, we are guiding our investors in advance. As the DoE makes periodic assessments, we can see the balanced way forward,” Fuentebella said, adding a detailed discussion will follow.
According to Cusi, the agency’s most recent assessment revealed the need for the country to shift to a more flexible power supply mix. “This would help build a more sustainable power system that will be resilient in the face of structural changes in demand and will be flexible enough to accommodate the entry of new, cleaner and indigenous technological innovations,” he said.
At the same time, the DoE chief announced the Philippines is now allowing 100-percent foreign ownership in large-scale geothermal exploration, development and utilization projects. Large-scale geothermal projects are those with an initial investment cost of about $50 million capitalization through Financial and Technical Assistance Agreements (FTAAs).
FTAAs may be entered into between foreign contractors and the Philippine government for the large-scale exploration, development and utilization of natural resources, and are signed by the President. “We need to prepare for the influx of RE (renewable energy) under the recent policies issued by the DoE. Hence the need for more flexibility,” Fuentebella told reporters. But Laban Konsyumer Inc. President Victorio Mario Dimagiba it was the Energy Regulatory Commission that made renewables “too expensive” in the country.
“We have a competitive selection process approved by the Supreme Court. Let that policy mature and to enable power plants and distribution utilities to provide least cost to consumers. Renewable energy was made too expensive by no less than ERC,” he said in a message. Cusi said he signed last October 20 a department circular providing the guidelines for the third Open and Competitive Selection Process (OCSP3) in the awarding of RE Service Contracts.
“From an investment perspective, OCSP3 allows for 100-percent foreign ownership in large-scale geothermal exploration, development, and utilization projects,” he said. Cusi also reiterated his commitment to promote RE, as he expressed hope that in time, renewables will figure prominently in the country’s energy future.
“As the Philippine Department of Energy reevaluates the appropriateness of our current energy mix vis-a-vis our energy goals, I am optimistic that this would lead to more opportunities for RE to figure prominently in our country’s energy future,” he said.
Cusi noted that as of 2019, the Philippines still had the highest RE share in the total primary energy supply from among countries within Southeast Asia. “Despite this, 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 added.