Energy sector still faces major hurdles – expert

THE Marcos administration has shown commendable momentum in opening up the country’s energy sector to foreign investments and expanding renewable energy, but challenges continue to hinder the Philippines’ energy security and affordability, a top energy expert said.

Joey Ocon, co-convenor of the Center for Energy Research and Policy, and a professor of chemical engineering at the University of the Philippines Diliman, gave the administration a score of seven out of 10 in a review of the government’s three-year energy track record.

In an interview with The Manila Times on Saturday, Ocon said the score reflects mixed results, with tangible progress in liberalizing the sector and building an investment pipeline, but lingering “blind spots” in energy access and delivery, especially in remote and tourism-reliant communities.

“There is clearly momentum in terms of opening foreign ownership and encouraging investments in renewables,” Ocon said. “However, reliability remains a critical blind spot, especially in island communities that rely heavily on tourism. These are the most vulnerable to power interruptions.”

Ocon cited the administration’s notable efforts to fast-track grid modernization and support indigenous energy development and energy storage systems. However, he said the government has fallen short in addressing gaps in rural electrification and inclusive governance.

Electrification remains incomplete, with about 4 percent of geographically isolated and disadvantaged communities still lacking access to electricity. While the National Electrification Administration is deploying thousands of solar home systems, these do not provide full household power and are not a substitute for long-term access.

“The last few percent are always the hardest to reach. They are mostly in remote islands and mountainous areas where building conventional infrastructure is prohibitively expensive,” said Ocon.

He noted that grid congestion is a major obstacle. Even as the country adds new capacity from solar and wind sources, the lack of transmission infrastructure delays plant connections and results in curtailed power production.

“If you keep adding renewable plants but the grid isn’t ready to handle the load, it’s like building a highway with no on-ramps,” Ocon explained. “Without improving transmission, our renewable goals will remain out of reach.”

Another issue is the underfunding of rural electrification. Ocon explained that funds drawn from government coffers and the Universal Charge for Missionary Electrification are largely spent on subsidizing diesel generation in off-grid areas. As a result, very little is left for infrastructure that could provide more sustainable and cost-effective energy to unserved communities.

“We need to shift focus and financing toward renewable-based solutions and infrastructure expansion,” he said.

Ocon also warned fast-tracking permitting procedures, such as the green lane for energy projects, can sideline critical consultations with farmers and fisherfolk. Agricultural lands are being converted into solar farms, and offshore wind developments are encroaching on traditional fishing zones, raising concerns over inclusivity and fairness.

“There’s a risk that in the rush to add capacity, we overlook the voices of communities,” he said. “We have to balance rapid energy development with protecting livelihoods. Proper consultation and participatory governance cannot be sacrificed for speed.”

Looking at the Department of Energy’s planning, Ocon said the biggest disconnect between policy and reality lies in implementation. While national plans emphasize renewable energy, the lack of supporting infrastructure and local engagement limits actual impact on the ground. He also highlighted the need for more transparency in how the Philippine Energy Plan is constructed.

“Without transparency, it’s difficult to evaluate how realistic these plans are or to propose necessary adjustments,” he said.

Regarding nuclear energy, Ocon noted that while nuclear energy could potentially help diversify the country’s energy mix, the technology is still unproven at scale. Larger nuclear projects face long construction timelines and high costs.

Ocon emphasized the importance of prioritizing renewable energy generation planning to align new projects with available transmission capacity. He said the government must also reform the way electrification efforts are funded and implemented. Reducing the cost of electricity through more competitive and transparent procurement processes remains another urgent need.

“The three key priorities should be planning renewable capacity in sync with grid readiness, reforming electrification funding to truly reach the unserved and reforming procurement to lower electricity costs,” he said.

Ocon hopes that President Ferdinand Marcos Jr.’s upcoming State of the Nation Address (SONA) would include a strong push for energy reliability and resilience. He also called for de-risking energy investments through streamlined permitting and stronger investor protections.

“We need the administration to address the energy reliability issues head-on,” he said. “Investors also need confidence that projects won’t get stuck in red tape or legal battles.”