Balancing Act: Here’s How AboitizPower is Pushing for a Cleaner, More Sustainable Energy Future
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Unlocking all available power sources and embracing technological diversity could fortify the nation's energy security and ensure the Philippines’ continued economic growth.
Embracing a flexible and inclusive approach to energy generation is the soundest possible solution to meet the escalating demand for power across short, mid, and long-term horizons–all while progressively minimizing adverse environmental impact.
AboitizPower President and CEO Emmanuel “Manny” Rubio believes that with global uncertainties and the projected increase in electricity demand, the Philippine energy sector has to look into all available sources of power and be open to all technologies.
Given the country’s current growth trajectory, the Philippines will require an additional 600 megawatts (MW) to 700 MW of new power generation capacity per year over the next decade or so. And to effectively meet this demand, Rubio is strongly advocating the diversification of power sources, one that will ensure energy security and—hopefully—reduce energy poverty in the country.
“We recognize the importance of exploring all power sources, both traditional and renewable energy (RE), and even energy storage, each having unique advantages and disadvantages and specific roles to fulfill in a more diverse, more reliable, and cleaner energy system that can power the economic progress of the country,” Rubio told Esquire Philippines.
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Cleaner, more affordable energy future
Central to AboitizPower's vision is the diversification of energy sources–especially during the energy transition. Rubio said liquefied natural gas (LNG), hailed as a pragmatic bridge fuel towards a cleaner future, stands to complement solar, wind, and other renewable technologies to collectively propel the Philippines towards energy independence and sustainability.
“Our investment in natural gas will further diversify our portfolio, allowing us to contribute to the energy security of the country,” Rubio said. “Natural gas is a complement to the influx of more variable renewable energy in the country’s energy mix, due to its ability to ramp up quickly, in response to the generation intermittency of solar and wind, when the sun does not shine, or the wind does not blow.”
AboitizPower, together with Meralco Power Gen Corp. and San Miguel Global Power Holdings Corp., invested $3.3 billion or about P185 billion in the Philippines’ first integrated LNG facility in Batangas.
This investment, which leverages advanced LNG storage and regasification capabilities, aims to boost the country’s power generation capacity by another 2,500 MW.
Rubio explained that AboitizPower’s foray into LNG-to-power is rooted in its reduced carbon dioxide emissions—around half versus coal—and its innate flexibility and reliability as an energy source.
“LNG’s role in AboitizPower’s portfolio helps add reliable and stable capacity needed by our country’s growing economy,” he said. “Since power generation entirely from renewable energy sources is still not yet possible and commercially viable in the Philippines, LNG has to be embraced as a bridge toward that future energy system.”
The consortium’s LNG facility will help in providing more competitively priced and affordable access to power for Filipino consumers.
“An important aspect of this investment is size and scale, to gain economies of scale and thus help drive power prices down. Energy investments of this size and complexity require a lot of capital and expertise, and corresponding risks, which are best shared and distributed among the top energy companies that have the experience and capacity to deliver,” Rubio explained.
According to the Department of Energy's (DOE) Philippine Energy Plan, LNG will play a critical role in ensuring energy sustainability and security. It is, in fact, aiming to boost LNG’s share in the country’s energy mix to 26 percent by 2040.
RE projects taking shape
Aside from its investment in LNG, AboitizPower is also beefing up its RE portfolio, aiming to contribute to the country’s ambition to add more renewable capacity in the energy mix and also the overall power generation growth needs of the country.
“Our 50/50 goal by 2030 is very much aligned with the Philippine Energy Plan, where the DOE has indicated a 35 percent RE energy mix share for the total country by 2030 and a 50 percent RE share by 2040,” Rubio said.
Together with its partners, AboitizPower has the most RE in the country based on installed generation capacity.
“And we aim to add 3,700 MW of new RE generation capacity, tripling our generation capacity by the end of this decade,” he said. “All our renewable projects are envisioned to contribute to our goal of increasing our RE capacity to 4,600 MW by 2030.”
Some of the company’s RE projects are expected to be commercially operational this month and in May.
The Laoag Solar project, with a peak capacity of 159 MW, and the 17-MW Tiwi Binary Geothermal Power Plant are expected to be energized within April.
AboitizPower is also anticipating obtaining its commercial operation date for the 94-MW Cayanga Solar Project in May.
Furthermore, AboitizPower signed a joint venture agreement with Singapore-based Vena Energy for a 102-MW wind project in Rizal and Laguna. The wind power project is expected to reach financial close and commercial operations in 2024 and 2025, respectively. The company also signed a memorandum of understanding with the Japan Bank for International Cooperation to aid the Philippines in improving its energy system, with a strong focus on RE, emission reduction, and LNG development.
Lastly, AboitizPower is looking at expanding its clean energy portfolio through possible investments in offshore wind, using ammonia and hydrogen to co-fire its thermal power plants, and is exploring the potential of nuclear energy.
Addressing the needs
For Rubio, RE and traditional energy sources go hand in hand in addressing the current and future needs of the Filipino people. The Philippines, he said, needs to significantly increase its infrastructure initiatives, expand the grid to ensure that power reaches demand centers, and improve the services, reach, and efficiency of electric cooperatives and distribution units.
He also highlighted the need for sufficient transmission capacity to support the influx of new generation capacity.
The company believes that sound policies and the improved implementation of regulations and laws, such as the Ease of Doing Business Act and the Energy Virtual One-Stop Shop, will substantially enable the industry to flourish.
“Regardless of whether or not any power project is renewable, our priority is to address the needs of our fellow Filipinos, help our country progress, and facilitate a balanced and well-planned energy transition that will suit the needs of our country and help attain the fullest development potential of Filipinos,” Rubio said. “The Philippines will need all forms of energy to fuel its progress.”
