The Philippines’ Department of Energy (DoE) is aggressively pursuing on- and off-shore wind power projects. As investment portfolios, contracts and memoranda of understanding have been signed or deployed towards the end of March and the first week of April, energy analysts are in agreement that the archipelago will benefit from promoting wind power side by side with solar, wave, and geothermal energy sources.
Four new projects have been aligned and are ready for implementation starting the second half of this year.
Last October, the DoE issued forty wind energy service contracts (WESC) with estimated total power output of 10 GW. To date, an additional 17 WESCs were sent out, adding another 42,000 MW to the total potential capacity. There is an estimated 178 GW offshore wind power potential in the Philippines, according to Energy Tracker Asia.
Given the track the investments are coming in, the country has the potential to install 21 GW of offshore wind power by 2040. This is can produce about a fifth of its electricity need by that time and meet the expected power demands by then, according to a joint study by the DoE and the World Bank.
The DoE said that it had inked three contracts with a Danish fund manager, Copenhagen Infrastructure New Markets Fund (CINMF), which is the first foreign firm allowed to have a 100% interest in Philippine offshore wind energy. This project, with a total capacity of 2,000 megawatts, will be located in the areas of the country where the winds can produce the highest capacity factors.
These CINMF projects are located in the South Luzon provinces of Camarines Norte and Camarines Sur in the Bicol Region, some 479 kilometers (297 miles) from the capital Manila, in Northern Samar in the Visayas Region (820 kilometers or 490 miles from Manila) and in Pangasinan (210 kilometers or 130 miles) and La Union (266 kilometers or 160 miles) in North Luzon.
There, CINMF service contracts have a 25-year operating period. The three projects are expected to offset about 2.9 million tons of CO2 emissions per year, and power about a million households, the DOE said.
Aboitiz Power Projects
Aboitiz Power Corporation, a large “techconglomerate” in the Philippines, announced that continues to look for partners to develop 3 gigawatts of power from offshore wind projects. The company bagged several WESC spots alongside companies like the Shell and Altenergy joint venture, Alternergy Ltd., the Ayala Group’s AC Energy Inc., General Electric Company, PetroEnergy Resources Corporation, and Vestas Wind Systems via other joint ventures.
Aboitiz partnered with Norwegian Scatec ASA to take a portion of the 178 GWh WESC pie and is keen on developing 2,400 megawatts of wind energy projects in the Philippines in the next 10 to 20 years.
Torbjorn Elliot Kirkeby-Garstad, Scatec general manager for Southeast Asia, said the projects, worth “billions of dollars,” were already secured.
“We have five sites. One is onshore, the rest are offshore… The plan there is to do those projects together with, my preference is with Aboitiz having worked with them for 15 years,” Garstad said.
In October 2022, the Embassy held “Creating Currents Together,” a maritime and energy conference where the Norwegian Ambassador-Designate to the Philippines Christian Halaas Lyster highlighted the consulate’s role in the Philippines’ carbon neutral ambitions.
“Norwegian companies and investors can play a very crucial role delivering renewable energy solutions to the Philippines. This for example includes developing offshore wind and floating solar, in addition to LNG as a transitional source of energy,” Lyster says.
Norway has been involved in the Philippine energy market for over years. Scatec and Aboitiz Energy owns and operates four hydropower plant. SN Aboitiz Power has installed floating solar technology at the 11.2 sq. km (4.32 sq. miles) Magat Dam in 2019. Ocean Sun, another Norwegian company provided the floating solar technology.
“We are working more wind projects as we speak, we are putting met masts, one of the key things so you can get your own data, make sure that with months and hopefully years on that wind data, that becomes a robust platform on how to take this project forward. That’s the stage we are at right now,” Garstad added.
Met masts are equipment used in developing wind power projects to precisely record wind speed in an area to estimate the amount of energy that can be produced and whether turbines can safely operate.
Under a collaboration with Singapore-based investment firm Clime Capital Management, the Rocky Mountain Institute of the US and the United States Trade and Development Agency (USTDA), AboitizPower started a feasibility study last August 11 and is expected to be completed by the middle of 2023. USTDA is partly funding the initiative.
Philippine Offshore Ambitions
Currently, the Philippines has 443 MW of onshore wind farms in operation.
The biggest ones are the Bangui Windmills in North Luzon and the Pililia Wind Farm in the mountains of Rizal, in the east of Luzon. Offshore wind deployment, however, promises even greater power potential. It is estimated that the Philippines is capable of growing its installed wind turbine capacity to 3 GW by 2040 and 6 GW by 2050, while the national government aims for 12 GW by 2040.
To achieve these goals, the Philippine government has made investments in renewable energy exempt from its 40% limit on foreign ownership, pushing also to increase the share of renewable energy sources in its energy mix to 35% by 2030 and to 50% by 2040, from the current 22%. At the same time this is happening, the energy department seeks to phase out coal-fired power plants and transition to low-carbon fuels.
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