Philippines urged to scale up energy investments
The Philippines needs to scale up investments in the energy sector to meet rising Asean sustainability standards and long-term demand, according to the Philippine Institute for Development Studies (PIDS).
In its report on the Asean Economic Community (AEC), the state-run think tank said that the country has shown a “steady but moderated level” of renewable energy investments over the past two decades. This has amounted to $20 billion.
This comes as members of the Association of Southeast Asian Nations ramped up clean energy spending. Vietnam alone has racked up 32 billion in 2023. This highlights a widening gap in the pace of investment.
“The [Philippines’] consistent efforts suggest a maintained focus on renewable energy projects, although there is no significant surge in investment,” PIDS said.
As a response, PIDS said the country’s Public-Private Partnership (PPP) Center and the Board of Investments (BOI) should coordinate to develop a unified sustainability scorecard, a tool to track and measure the environmental, social and governance (ESG) performance of public and private investments.
“Public and private investments should be required to assess climate risk exposure and green growth multipliers,” PIDS said.
The think tank also recommended that the Philippines introduce stronger measures to align with Asean green standards. These include carbon border measures and ESG incentives for exporters.
“Investment in renewables, green infrastructure and climate-smart agriculture not only serves domestic sustainability goals but can also reposition the country as a supplier of green services and products,” PIDS said.
In turn, this would allow the country to “proactively engage” in Asean-level climate finance mechanisms and classification of sustainable finance.
The call for increased investment comes as the Marcos administration moves to channel more resources into the energy sector.
Earlier, Finance Secretary Frederick Go told reporters that the Maharlika Investment Corp. (MIC), which manages the country’s sovereign wealth fund, should prioritize energy projects.
“Energy is certainly one sector in the Philippines that could be developed further, with the main objective of reducing power costs. This necessitates increasing energy supply and making it more predictable, consistent and stable,” he said.
In August, the MIC signed a memorandum of understanding with Saudi developer ACWA Power to explore renewable energy projects in the country’s off-grid islands.
MIC also made its first investment last January through a 20-percent stake in the National Grid Corp. of the Philippines. In addition, it recently signed a memorandum of agreement for a long-term initiative to modernize and strengthen Palawan’s power transmission backbone.
The Department of Energy has been pursuing programs aimed at expanding renewable energy. The 2026 agenda is anchored on cleaner energy and energy security.
So far, renewable energy accounts for about 32 percent of the total energy mix, approaching the 35-percent target by 2030. Meanwhile, island grids make up only around 7 percent.
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