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III. Electric Industry & Philippine Economy

Economic growth has been impeded in the Philippines by the unreliability

and high cost of the power (Anonymous, 2011). According to (Rivera, 2016),

the countrys power demand could double in the next 15 years as the

economy continues to grow by at least six percent per year. Reliable and

secure electricity services at competitive rates are essential to improving the

investment climate in a country that has limited fossil fuel reserves and

therefore is highly dependent on renewable and imported energy

(Anonymous, 2016). The Philippines has some of the most expensive

electricity in Southeast Asia, averaging $0.18 per kilowatt-hour in 2009

because (i) archipelagic geography makes electricity costly in some areas;

(ii) generation, transmission, and distribution systems are inefficient; and (iii)

investment in the sector is low, coupled with the high cost of investments

made during the countrys power crisis in the 1990s (Anonymous, 2011). The

challenge in the energy sector is to ensure sustainable and reliable supply at

reasonable cost. The Philippines will have nearly 68% of its population living

in cities by 2030. Total household consumption is expected to more than

double under current energy policies, while adopting energy-efficiency

standards could shave as much as 9.5% off residential power demand. In its

20092030 Philippine Energy Plan (Anonymous, 2006), the Department of

Energy (DOE) forecasts average annual electricity demand growth of 4.6%,

Egbus, Glimada, Gregorio, Wacan, Almoite, Altubar

which means that the country will need to add 16,550 MW of generation

capacity from 2009 to 2030 (Anonymous, 2011).

The Philippines has several possibilities to get clean and cheap energy. The

tropical climate and geological circumstances are responsible for three

different energy resources; (i) solar energy which is cheap and inexhaustible,

(ii) natural gas which an enormous mass can be found in Palawan and (iii)

relatively cheap geothermal energy.

Solar Energy is perhaps the most recognized renewable energy source.

Energy from the sun is captured using cells made from special materials

(silicon is quite popular right now) and then converted into electricity. The

biggest factor in solar cell production is cost. However, with technological

advancements solar is becoming more cost efficient, and high efficiency

solar cells are being developed. This is important, since high efficiency cells

are hard to come by. New materials are providing solar cells that are easier

to transport and install (Marquit, 2009).

Geothermal energy is created below Earth's surface, and efforts are being

made to extract and use this power (Marquit, 2009). Likewise, the Philippines

is located in a relatively active seismic area. Geothermal energy allows the

country to use this to its advantage. Currently, the Philippines is the second

highest producer of geothermal energy. The government has set a goal to

surpass the United States as the highest producer in the world (White, 2016).
Egbus, Glimada, Gregorio, Wacan, Almoite, Altubar

Lastly, natural gas deposits in the Philippines are located offshore, above the

country's deep-sea oil reserves. The Philippines possesses 3.9 trillion cubic

feet of natural gas reserves. Although extraction only began in 2000,

production has been able to meet demand every year without imports. Even

larger natural gas deposits may be held in another offshore location (White,

2016).