IMF says P11 trillion needed to meet Philippine clean energy targets
The Philippines will need to mobilize nearly P11 trillion in public and private investment to meet its clean energy transition goals, the International Monetary Fund (IMF) says, while also warning that structural constraints could slow progress toward those targets.
In a report, the IMF says investment needs for renewable energy projects are set to rise sharply from 2023 to 2050 under all scenarios outlined in the government’s Philippine Energy Plan 2023–2050.
Between 2029 and 2050, required investments could total P7.39 trillion—about 28 percent of gross domestic product (GDP)—under a scenario that assumes the adoption of offshore wind, nuclear power and more efficient new power plants. These will lift the share of renewable energy to 50 percent of the total energy mix by 2050, the fund says.
A more ambitious scenario, which expands offshore wind capacity from 19 gigawatts (GW) to 50 GW and pushes the renewable energy share above 50 percent, will require investments of as much as P10.67 trillion or roughly 40 percent of the country’s 2024 GDP, according to the IMF.
“Meeting these targets requires strong public and private participation, particularly in capital-intensive industries,” the fund explains.
“This will necessitate prompt and comprehensive solutions to key barriers that currently impede project implementation and investor confidence,” it adds.
As it is, the Philippines has substantial potential for renewable energy development. The combined potential of open-field solar, rooftop solar, offshore and onshore wind energy could generate about 1,200 GW of power, according to Climate Analytics 2023.
In addition, the Department of Energy has estimated that the country’s wet season and varied terrain offer multiple opportunities for hydropower development through dams, rivers and waterfalls, with an estimated untapped potential of 13.097 GW.
But the IMF flags key challenges that could hamper clean power development, including limited grid infrastructure, delays in land acquisition, high capital costs and a severe shortage of skilled workers, among others.
