The Philippines had the fastest-growing economy in 2023 among the Association of Southeast Asian Nations (ASEAN) according to the International Monetary Fund (IMF).
Based on the latest World Economic Outlook, the IMF forecasts a 6.2 % gross domestic product (GDP) growth rate for the Philippines this year, second only to the 6.5% forecast for India. The Philippines experienced a 5.5% growth in its GDP in 2023.
The growth rate forecast for other ASEAN countries for 2024 is as follows: China 5%; Indonesia, 5%; Malaysia, 4.4%; Kazakhstan, 3.5 %; Iran, 3.3 %; Thailand, 2.9 %; Egypt, 2.7 %; South Korea, 2.5 %; Pakistan, 2 %; Saudi Arabia, 1.7 %; and Japan, 0.7 %.
The Department of Energy (DOE) is committed to supporting the Philippines’ economic growth. At a recent energy forum in Makati, DOE Secretary Raphael Lotilla stressed the need to secure baseload capacities to ensure energy security for the country’s growing needs.
“We aim for adequate baseload capacities while boosting renewable energy in the mix,” Lotilla said.
Metro Cebu leads PH growth
Leading the Philippines’ growth is Central Visayas, particularly Metro Cebu. Among the country’s 17 regions, Central Visayas enjoyed the most growth, registering 7.3% GDP in 2023.
Cebu’s growth is attributed to its strategic location and its active construction, tourism and Information Technology and Business Process Management (IT-BPM) industries.
The growth translates to an increase in the national GDP (Gross Domestic Product), regional prosperity, foreign investments, and job creation.
Growing energy needs
In the Visayas, power consumption is centered around Cebu.
Half of the total energy demands of the Visayas is coming from Cebu province. According to projections, Cebu province will require 1,400 MW in the next two years, outpacing supply.
In addition to the province’s growing energy needs, it is worrisome to note that about 60% of the energy that Cebu consumes is sourced outside. Cebu relies on energy imports from Panay Island, Leyte, and Luzon.
Without local and sufficient baseload capacities, Cebu is at the mercy of unstable energy supply. In January of this year, Panay Island suffered a four-day blackout while high peak demands in April raised Red and Yellow alerts for the Visayas and Luzon grids.
Support from the energy sector
Lotilla assured stakeholders that over 6,300 megawatts of capacity is available from coal plants that are not over 10 years of age. But to support the rapid development of the region, the industry should be open to expanding its existing coal power plants.
“Maximizing the use of existing energy infrastructure avoids imposing additional cost burdens on both the economy and consumers,” Lotilla said.
To reduce the country’s dependence on coal and work towards a more sustainable future, the DOE imposed a moratorium on building new coal power plants. But, Lotilla clarified, “while there is an existing moratorium on building coal-fired power plants, there are also exemptions for committed, indicative, and expansion plans.”
At a Cebu Business Month Summit held at the SM Seaside City, acting Cebu City Mayor Alvin Garcia said that the city is working towards energy security.
“We have to invite investments from the private sectors, especially the power generation companies already here. We only have to let them expand their capacity to supply power to Cebu Island,” Garcia said.
At the same forum, Aboitiz Power Corporation, through its subsidiary Therma Visayas Inc. (TVI),
declared its commitment to the city’s energy goals through the generation of an additional 150 megawatts (MW) by 2028.
Ronaldo Ramos, COO for Operated Assets of the AboitizPower Therma Business Group shared that as soon as the required permits are secured, construction of the brownfield expansion plant in Toledo City will begin. The target for the start of construction is the end of 2025.
References:
Department of Energy vows continued support for PH economic growth – Manila Standard
World Economic Outlook, April 2024: Steady but Slow: Resilience amid Divergence (imf.org)
Coal-fired plants can support PHL baseload needs until 2030 — DoE