The Makati Business Club (MBC) has urged the government to open the country’s power grid infrastructure to private investment through a build-operate-transfer (BOT) scheme. The call comes as the Philippines faces mounting challenges in achieving full electrification and expanding its renewable energy capacity.
In a statement released today, MBC emphasized the need for policy reforms to address bottlenecks in power transmission. As of June 2023, household electrification levels in the country stood at 91.1%, with the Department of Energy (DOE) aiming for full electrification by 2028. However, the current pace of grid development is proving insufficient to meet the growing demand for electricity, particularly from renewable energy sources.
The Philippine Energy Plan targets a renewable energy share of 35% in the national mix by 2030 and 50% by 2040. Yet, grid investment has lagged behind renewable energy development. According to the International Energy Agency, since 2018, renewable energy investments have exceeded grid spending by an average of $200 billion annually. This funding gap has only widened, with BMI Research, under the Fitch Group, estimating an average shortfall of $328 billion as of 2023.
MBC argues that allowing third-party investors—including private firms and government-owned and controlled corporations—to build and operate power transmission infrastructure could accelerate grid expansion, reduce long-term costs, and improve overall transmission efficiency. Such measures are seen as vital given the Philippines’ growing appeal as an investment destination for renewable energy. The 2024 Climatescope report by BloombergNEF recently ranked the Philippines as the second-most attractive emerging market for renewable energy investment.
Beyond transmission infrastructure, MBC is also pushing for stronger public-private partnerships in off-grid solutions to bring electricity to remote communities. Such efforts, the group believes, will be key to ensuring that the country achieves universal electrification within the DOE’s 2028 target.
As the government considers its next steps, what do you think of MBC’s proposal? Could private investment be the key to a more stable and sustainable power grid? Join the discussion and share your thoughts on how the Philippines can best address its energy challenges.
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