‘PH needs 10K MW to meet energy demand’


The Philippines needs at least 10,000 megawatts (MW) or at least $20 to $30 billion of investment in the next 15 years is the economy is to grow by 7 percent to 8 percent in gross domestic product.

“We have to build at least 10,000 MW more plants, at least $2M per MW, you’re talking $20 billion to 30 billion of investments needed in the next 15 years or so,” Business magnate Manuel Pangilinan said during the Asian Institute of Management (AIM) media round table with some of the Philippines’ business leaders on Wednesday.

“The question for this country is, you know you have to build power plants, because the economy will grow at 6, 7, 8 percent, whatever it is, and some of these plants, especially some of the oil-fired plants are too old, too expensive to operate,” Pangilinan said.

The industry today has about 16,000 MW of installed capacity. The current demand around 12,000 MW and growing.

“On paper, it looks like we do have sufficient reserves. I just got a text it’s the second day we’re on yellow alert. Which means the actual nameplate capacity in relation to the actual capacity to produce power versus the capacity is much , especially if some plants are on planned or unplanned shutdowns,” Pangilinan said.

He argued that if you project it, say up to 2030, consensus view is demand could, from the current 12,000 MW, rise to as much as 20, 22, 24,000 MW. Clearly, the country needs more capacities to be built in the next 15 years or so, Pangilinan noted.

Issues surrounding the power industry were not raised during the recently concluded forum held in Davao City, with the incoming economic team of President-elect Rodrigo Duterte.

“Unfortunately, it wasnt—the power industry—not to mention the mining industry, but it should have been,” Pangilinan said.

“Question is, What is your fuel mix? Coal, gas, renewables… are your only options. The argument for renewables is that the sun shines everywhere, wind is everywhere, biofuels are everywhere,” Pangilinan said.

“The seduction for renewables is there. But can you build renewable energy to build enough renewables to fill up this 10,000-12,000 MW of additional capacity and more importantly, how much would it cost. You have to address that. It’s not cheap, it’s not going to be cheaper than coal or gas,” he said.

“Remember, there’s always a price you need to protect environment,” he added.
Pangilinan said that energy industry players need policy direction on the appropriate fuel mix. Once it’s decided, businesses will build the plants, whether it is a gas plant, coal plant or renewable, he said.

“If that’s the policy direction, then that’s the policy direction. If the entire 10,000 MW that have to be built in the next 15 years are all renewables, we have to quantify the cost of billing the renewable plants,” he said.

“I’m telling you know, it’s more expensive than coal plants and gas plants. If that’s the policy direction, then there’s a consequence. You just have to tell the people, look, we have to protect your environment and the cost is, in broad terms, is like this. But we have to do this because we need to protect our environment,” he added.

“If that’s accepted, then fine, business will follow that direction. You just have to say, this is what we want,” he said.


Please follow our commenting guidelines.

1 Comment

  1. the best energy mix to meet the current and growing energy demand to support robust economic growth year by year should be 25~30% renewables (including geothermal & hydro) and 70~75% fossil fired (coal, oil & nat gas). fossil fired power plants provide steady base load that is much needed for industries and manufacturing since they operate 24/7 year by year (with 15~20 days shutdown for maintenance) and translates to 80~85% plant capacity factor. renewables like solar & wind will provide augmentation load during peak demand load (daytime) to reduce fossil fuel use (and emissions) on fossil fired power plants.

    perhaps, not very many knows that solar & wind though readily available can only provide 18~25% energy year by year, meaning a 100 MW solar power plant capacity only capable of generating an average 18MWh of energy day by day compared to 85MWh of energy on same capacity for fossil fired power plant. likewise, renewables can not be reliably use to augment loss of generation when one or two of the base load plants are shutdown (forced and unforced). only hydro can provide regulation load during emergency shutdowns.