Notes on the beat: What can the Philippines learn from the Australian energy market?

SYDNEY – If the energy transition is a marathon, Australia is already running with steady confidence, while the Philippines is still finding its footing.

Both countries want to break free from the grip of coal plants, racing toward a cleaner and more secure energy future. Yet only one appears to have embraced a holistic approach.

Although the Philippines has charted a roadmap toward its clean power goals, Australian energy experts believe this alone won’t get the country across the finish line.

“One area that Australia might apply to the Philippines is the planning and enabling of the transmission and energy storage system needed now and into the future,” ACEN Australia executive chairman Jose Maria Zabaleta said in an interview here last week.

ACEN Australia is a subsidiary of the Zobel family’s ACEN Corp., the fifth-largest power producer in the Philippines.

“There can be no successful energy transition and self-sufficiency without new transmission and energy storage capacity,” Zabaleta said.

A battery storage system stores excess electricity generated during low-demand periods and supplies it back to the grid during peak demand, ensuring the stability and reliability of the transmission network.

The technology is expected to reinforce the grid as the country tries to keep up with the influx of variable renewable sources.

Under the Philippine Energy Plan, the country aims to increase the share of renewables in the energy mix to 35 percent by 2030 and 50 percent by 2040, from the current 22 percent.

However, the limited availability of interconnection points continues to pose challenges to developers, as several awarded service contracts are located far from existing transmission lines.

These challenges have caused significant project delays and, in some cases, the unfortunate termination of contracts.

Renewable energy zones

This clear disconnect in how the Philippines is managing its energy transition strategy was exactly what ACEN Australia head of development Killian Wentrup pointed out.

“What we figured out in Australia is that to enable the next phase of the energy transition, you need to do it in a much bigger, more coordinated way,” he said.

For instance, in New South Wales – home to most of ACEN Australia’s projects – large-scale  developments are strategically clustered in renewable energy zones to align with transmission infrastructure.

“The state is coordinating the transmission investment, and the individual private companies are doing their generation development,” Wentrup said.

“We’ve been working together for three or four years now, and the generators have been awarded what we call access rights to the new network.”

This coordinated approach, Wentrup highlighted, gives investors and developers the confidence to build their projects.

“I think what Australia is proving with that model is you can do it in a more coordinated way at a larger scale if you really put your mind to it and you get all the right actors around the table,” he said.

Back home, the National Grid Corp. of the Philippines has called for a “holistic solution” to address challenges across the country’s power supply chain.

The NGCP added that development in all involved sectors within the industry “must be coordinated, with due attention given to each.”

Some 10,260 megawatts (MW) of transmission capacity remain available across the country, most of which is in Luzon, according to latest NGCP data.

Despite this vast available capacity, the key challenge lies in where the service contracts are located, making the grid connection difficult.

“There’s a disconnect. And so it’s always going to be piecemeal,” Wentrup emphasized.

$3 billion  wind project

In Australia, ACEN is powering ahead to further expand its presence in a bid to become a clean energy powerhouse Down Under.

This expansion plan recently received a major boost after ACEN Australia secured government approval for the development of its $3-billion Robbins Island Wind Project in Tasmania.

With a capacity of 900 MW, the wind farm is poised to energize up to 500,000 homes and deliver over $30 million in capital into the Tasmanian economy annually.

A separate approval, meanwhile, is underway for the transmission line that will link the project to the grid, with processing targeted for completion by 2026.

The grid approval, ACEN Australia said, would allow the project to start generating power by 2030.

“The project supports Australia’s climate commitments, providing the lowest-cost clean alternative to fossil fuels in time to meet supply shortages,” ACEN Australia managing director David Pollington said.

Australia aims to achieve a renewable electricity generation of 82 percent by 2030.

Last year, 36 percent of the country’s electricity generation came from renewable sources, according to Australian government data.