MAP Insights

In a breakfast meeting packed with ambition and determination, Energy Secretary Raphael “Popo” Lotilla and Energy Regulatory Commission (ERC) Chairperson Monalisa “Mona” Dimalanta showcased their unwavering dedication to transforming the Philippine energy sector. With just one year in office, the dynamic duo has achieved remarkable milestones and set ambitious goals.

One of the key achievements highlighted in the meeting was Mr. Lotilla’s swift action to increase the renewable portfolio standards from a meager 1% to an impressive 2.52%. This bold move positions the power system to effectively increase the share of renewable energy (RE) in the supply mix to 35% by 2030 and an astounding 50% by 2040.

He also knew that to significantly increase the power supply in our system, we needed to open up the RE sector to foreign investment. Within four months of assuming office, Mr. Lotilla, armed with a legal opinion from the Department of Justice, unlocked for 100% foreign investment the use of solar energy, wind and hydropower energy for power generation.

Ms. Lotilla’s collaboration with Chairperson Dimalanta and the ERC has resulted in the development of policies and regulations that prioritize transparency in the energy sector. This fruitful partnership has given rise to initiatives such as market monitoring indices and a revamped ERC website, making it easier for consumers to file complaints and ensuring the affordability of electricity.

Ms. Dimalanta, leading the ERC, unveiled their ambitious goals for 2024, which include increasing sector transparency, pursuing affordable power prices and reinforcing accountability. Through innovative regulatory programs focused on offshore grids, electric vehicles (EVs) and micro-grids, the Department of Energy and ERC aim to satisfy stakeholders’ needs in terms of price affordability.

During the breakfast dialogue hosted by BDB Law and Management Association of the Philippines (MAP) on Aug. 14 at the Shangri-La The Fort, Secretary Lotilla emphasized the importance of self-sufficiency and security in the field of renewable energy. To achieve the goal of 50% RE capacity by 2040, the DoE recognizes the role of liquefied natural gas (LNG) as transition fuel. The country’s offshore wind potential will also be nurtured not only for energy security but also to increase private sector involvement in providing job opportunities to local workers and for skilled, technical Filipino workers abroad to return home.

The equally important aspect or pillar of DoE’s energy program is the effective implementation of energy efficiency and conservation measures to bring down overall energy consumption, lower greenhouse gas emissions and reduce intensity in the production of goods and services. This is not just simply a gut-feel reaction to high fuel prices, but the direction that the energy end-use market must take as a society. Sustainable development goals require a change in lifestyle, and it requires a change in consumption patterns.

These are the things that we need to undertake in order for our energy programs to succeed. Secretary Lotilla emphasized that DoE will have to work closely with designated establishments to reduce specific energy consumption across various commercial, industrial and transport end-users. The Inter-Agency Energy Efficiency and Conservation Committee will also have to aggressively stretch the energy saving impacts of the Government Energy Management Program.

Under the Electric Vehicle Industry Development Act or EVIDA, which promotes the development and use of alternative fuels and technologies, the Comprehensive Roadmap for the Electric Vehicle Industry sets a minimum 10% EV share in the vehicle fleet by 2040. DoE’s more ambitious target is to refleet 50% of all vehicle fleets by 2040 under a clean energy scenario. We look forward to 2028 when we expect all registered EV charging stations to get and use a percentage of their consumption from renewable energy sources. So shifting to electric vehicles does not by itself make sense if we cannot get the power for electric vehicles from renewables.

The ERC, in its efforts to boost flexibility in power supply contracting for off-grid areas, is actively transitioning from fossil fuels to renewables through hybrid programs. It is also addressing voltage challenges and improving backbone facilities in electric cooperatives.

Acknowledging the need to enhance competitiveness, the DoE understands that power costs in the Philippines cannot be subsidized to the same extent as neighboring countries. However, through renewable energy shifts and access to additional resources and technology, Mr. Lotilla and Ms. Dimalanta remain optimistic about achieving their ambitious RE targets.

Collaboration with MAP was mentioned for energy efficiency solutions, tax matter coordination and involvement in crafting the Philippine Energy Plan. The industry was encouraged to be open to different fuel sources like nuclear energy and offshore wind.

With their shared vision of a sustainable and efficient energy sector, Mr. Lotilla and Ms. Dimalanta prove to be a formidable force in driving change. Through their tireless efforts, they are reshaping the Philippine energy landscape, setting a promising path toward a greener and more prosperous future for all. What an exciting time it is for the energy sector!

Ruth Yu Owen is the chairperson of the Management Association of the Philippines (MAP) Energy Committee. She is the president of Upgrade Energy Philippines, Inc.

map@map.org.ph