Philippines may be frontrunner in wind energy development in Asia

MANILA, Philippines — The Philippines has the potential to be a frontrunner in wind energy development in Asia if it fully commits to renewable energy, improve permitting and leasing process, and boost its transmission system, according to the Global Wind Energy Council (GWEC).

GWEC said the country is well positioned to be a regional leader in wind energy since it “has an appropriate permitting and auctioning infrastructure in place, and was on track a decade ago to rely primarily on renewable energy.”

However, becoming a leader in wind energy development is hindered by a lack of strong policy commitment, drawn-out permitting and leasing process, and transmission bottlenecks.

These were the findings of GWEC, in collaboration with BVG Associates, in their latest report “Capturing Green Recovery Opportunities from Wind Power in Developing Economies.”

The report pointed out that while the current government publicly supports the push for renewables, it has historically promoted development of nuclear and liquefied natural gas (LNG) projects as alternatives to coal.

“Auctions are technology-neutral and biased towards baseload technologies, which has made it difficult for renewable energy projects to win contracts,” GWEC said, noting this process has contributed to the energy mix pattern skewed to coal.

It also pointed to the passive approach of the Department of Energy (DOE) towards wind energy expansion, “refraining from any significant steps to improve the wind energy pipeline and not actively promoting renewables as a necessary energy source.”

As for permits, the country’s current permitting system for renewable energy is lengthy, complex, and bureaucratic.

The report cited that wind developers need to secure permits from around 15 different national agencies, as well as the local government.

“Currently the online platform set up for permitting and bidding documents, EVOSS, only includes the DOE,” GWEC said.

Enacted in March 2019, Republic Act 11234, otherwise known as the Energy Virtual One Stop-Shop Act (EVOSS), aims to cut back on lengthy government processes and generate more energy investments in the country.

It created the EVOSS system, an online platform where prospective energy project developers can apply, submit documentary requirements, pay corresponding fees, and monitor the status of their application.

In terms of leasing, GWEC said the current leasing mechanism, service contracts, are viewed favorably by developers, but the terms and conditions could benefit from simplification.

“Additionally, the bidding process is seen to have excessive conditions attached to it, putting off prospective developers as they have to jump through multiple hoops to meet all the conditions,” it said.

Lastly, GWEC said the availability of grid connections and transmission network bottlenecks “present a considerable challenge, delaying projects and reducing investor confidence.”

To expand the use of wind energy that will help accelerate the country’s green recovery, Philippine policymakers are urged to commit to supporting renewable energy as the country’s preferred energy resource.

“This could include higher capacity targets for wind and renewable energy within the Philippines Energy Plan, as well as updated feasibility studies and measurement campaigns to explore wind energy potential using the latest technology,” GWEC said.

The country should also consider holding technology-specific auctions or pots within auctions to help the wind industry regain a footing.

“More transparency on the design and implementation of the Green Energy Auction Program (GEAP) will clarify the prioritization of renewable energy,” GWEC said.

GEAP provides additional market options for RE developers and generators and will promote a competitive setting of rates for RE supply in the country.

Last month, the DOE launched a notice of auction for 2,000 megawatts of renewable energy capacity under GEAP.

To address permitting challenges, the government should also expand the EVOSS beyond DOE.

“This should include formalizing a mechanism for regular industry input to the EVOSS task group, to provide ground- level perspectives of technical, operational, and administrative barriers which could slow down project development,” GWEC said.