Manya Rathore
Research expert covering India
Energy sector in the Philippines - statistics & facts
The energy sector in the Philippines is confronted with a significant challenge arising from the escalating peak power demand owing to population growth, rapid economic expansion, and a strong emphasis on digitalization. Despite efforts to increase the utilization of renewable energy sources, fossil fuels, primarily coal, continue to take up the majority of the power generation mix. Changes in energy supply and the high risk of natural disasters are expected to continue to hinder the country's ability to fulfill its energy needs.
The digitalization of various services, alongside population growth, and economic expansion can be expected to fuel energy demand in the Philippines. While the current power generation mix is driven by fossil fuels, particularly coal, the gross power generation of renewable energy sources have also slowly increased in recent periods.
Coal dominates the power generation mix
Fossil fuels such as coal, oil, and natural gas have been powering the Philippines for years, supplying about 80 percent of the country鈥檚 energy needs. The country is abundant with indigenous energy sources, particularly geothermal and biomass. However, they are not fully utilized due to a lack of financial investments. Instead, the energy mix is dominated primarily by coal imported mainly from Indonesia. In 2023, coal accounted for more than 60 percent of the power generation mix, followed by natural gas. Meanwhile, the country's oil refining capacity remained at 180,000 barrels per day since 2020, after the permanent closure of one refinery plant. Natural gas supply, primarily sourced domestically, is also facing supply depletion in 2027, forcing dependency on LNG imports. In addition, the energy department has initiated plans to revive the Bataan Nuclear Power Plant (BNPP) to supplement energy supply. Despite foreseen challenges in energy security, the country aims to be energy self-sufficient in 2030.Status of renewable energy
With its abundant renewable energy (RE) sources, the Philippines aims to transition to sustainable energy as it faces challenges in fossil fuel supply and volatile gasoline prices. RE sources had a total power generation capacity of about 26,300 gigawatt-hours in 2023, bringing its electricity capacity to 30 percent. The country aims to increase capacity in the coming years by expanding its commercial renewable energy projects and easing foreign ownership limits to boost investment. Between 2009 and 2022, solar energy projects generated the highest share of investments, followed by wind projects.Understanding the Philippines鈥 energy landscape
The Philippine electricity sector underwent privatization upon implementing the Electric Power Industry Reform Act 2001 (鈥淓PIRA鈥). As a result, electricity generation, transmission, and distribution were transferred to the private sector to liberalize and unbundle the power sector and promote competition. The largest distribution franchise in the country is owned by the Manila Electric Company (Meralco), which provides electricity across Metro Manila as well as nearby provinces like Bulacan, Cavite, and Laguna. The electrification rate reached roughly 93 percent in 2023, with BARMM recording the lowest electrification rate across the country.The digitalization of various services, alongside population growth, and economic expansion can be expected to fuel energy demand in the Philippines. While the current power generation mix is driven by fossil fuels, particularly coal, the gross power generation of renewable energy sources have also slowly increased in recent periods.
