Gov’t tells power firms: Voluntarily retire coal-fired plants

MANILA  -The Department of Energy (DOE) has formally called on power generation companies to voluntarily retire their coal-fired power plants early to facilitate the entry of new renewable energy technologies in the country in a bid to address the global climate emergency and meet growing demand.

Addressing stakeholders present in the 28th United Nations Climate Change Conference (COP28) in the United Arab Emirates on Tuesday, Energy Undersecretary Felix William Fuentebella recognized that “overburdened” Filipino power consumers risk having to shoulder the costs of energy transition if industry players did not find “strategic ways to shift the burden.”

“In line with its energy transition program, the Philippine government is encouraging a voluntary early and orderly decommissioning or repurposing of existing coal-fired power plants, while securing a stable supply and addressing the climate emergency by ramping up our renewable energy target of 50 percent by 2040,” he said in his statement of support.

This came after ACEN Corp., the listed energy platform of the Ayala group, launched its partnership with The Rockefeller Foundation and the Monetary Authority of Singapore to pilot a “coal-to-clean” project.

READ: ACEN partners with Rockefeller Foundation, MAS to-push-coal-to-clean-project

Fuentebella had also lauded ACEN for initiating the project and for being the first local company to voluntarily divest its stake in a coal-fired power plant in 2022 as part of its commitment to pursue more renewables.

“We also encourage every effort to incentivize the business owners and institutions that will participate in similar undertakings and work toward energy transition,” the DOE official said.

At present, the Philippines’ power mix is composed of nearly 60-percent coal, while renewables account for only 22 percent.

READ: Retirement of 10 out of PH’s 28 coal-fired power plants pushed

The country’s current demand stands at around 17,000 MW—versus 28,300 MW in supply—and this is expected to climb to 25,000 MW by 2028. Energy Secretary Raphael Lotilla had said the majority of the 8,000-MW required capacity addition would come from renewables.

READ: Philippine power reserves thin in 2023; but no red alert just yet

But while the Philippines was recently recognized for its “strong” energy transition commitments, Lotilla himself previously admitted that the country could not retire its coal plants overnight.

For his part, Fuentebella said power accessibility must come in tandem with coal retirement, especially in far-flung areas.

“We must also emphasize that our energy transition is beyond coal retirement. It also entails expanding our people’s access to electricity in remote islands, building a smart and green grid and improving the distribution systems, putting up more energy storage systems, and making energy affordable for all,” he said.