The Department of Energy (DOE) is pitching nuclear energy as a potential investment for the Maharlika Investment Fund, the country’s first sovereign wealth fund, as the latter intends to venture into the power sector.
DOE director Patrick Aquino said the agency would submit all the information gathered from the maiden Philippine International Nuclear Supply Chain Summit, hoping to guide the Maharlika Investment Corp. (MIC) in making a sound investment decision.
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“We leave it up to the sound judgment of Maharlika whether they come in at whatever stake, Aquino said on the sidelines of the nuclear forum held on Wednesday in Quezon City.
“We’ll be providing them the information from this event and from all of the things that we are doing so that they can make an informed decision on to what extent, if ever they will invest in nuclear,” he told reporters.
MIC is the fund manager of the Maharlika fund, which is mandated to advance the country’s long-term development goals through effective intergenerational management of government financial assets.
Breaking the ice
According to the state-run firm, the first investment could materialize by the fourth quarter of this year.
The firm had indicated that its initial investment would focus on the development of transmission and distribution infrastructure in remote areas to lower electricity costs in these areas. Finance Secretary Ralph Recto wants the first big-ticket item to be a stake in electricity superhighway National Grid Corporation of the Philippines.
Noting that the MIC’s charter mandates development, Aquino said, “For a country like us and our aspirations, electricity power is a big component.”
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Energy Secretary Raphael Lotilla said the DOE has commissioned the MIC to study the costing and possible financing mechanisms to achieve the Marcos administration’s goal of tapping nuclear energy.
“ … As the President pointed out, this is one area [that] needs to be studied further by the Philippines on what are the modes of financing available and how to go about financing,” Lotilla said.
Although the DOE did not provide a specific timeline as to when the study would be completed, Lotilla said the due diligence would look into alternative forms of financing for nuclear energy.
“But we won’t know what the cost is until after we shall have settled all the issues of what will be the technologies that we will be using … where’s the site, what are the particular needs of the site and so on,” he added.
President Ferdinand Marcos Jr. is giving his late father’s nuclear aspirations another go, studying the inclusion of nuclear energy into the power generation mix still dominated by coal.
The DOE said that nuclear energy could be tapped as early as 2032, a few years after the end of the Marcos administration, which wants to tap other sources of energy to meet the growing demand.
In his speech during the event, Lotilla cited an initial nuclear energy capacity of 1,200 megawatts (MW) in 2032, expanding to 2,400 MW by 2035 and further to 4,800 MW by 2050.
The three-day nuclear forum in Quezon City came a few months after the signing of the breakthrough 123 agreement on nuclear energy cooperation between the Philippines and the United States.
Entered into force in July, the deal seeks to enhance cooperation on clean energy and energy security, while strengthening their long-term bilateral diplomatic and economic relationships.
United States Ambassador to the Philippines Marykay Carlson said 16 American companies from the nuclear supply chain were participating in the event, “eager to explore trade and investment opportunities that support Philippine energy needs.”