The Philippines Department of Energy (DOE) will require developers of new renewable energy projects with a capacity of at least 10 megawatts (MW) to integrate energy storage systems in their plants to strengthen the grid’s capability to absorb more renewables and increase the country’s share of clean energy.
In a department circular, the DOE said all upcoming variable renewable energy facilities with an installed capacity of 10 MW or more must include battery storage capable of handling at least 20 per cent of the plant’s capacity.
Although the move will help variable renewable energy become reliable capacity, where electricity will be delivered as scheduled, it could result in “fragmented, sub-scale storage units” that could become more expensive, warned Ping Mendoza, president and board member of industry association Philippine Solar and Storage Energy Alliance (PSSEA).
“When you force every 10MW plant to have its own battery, you end up with fragmented, sub-scale storage units. It’s often more expensive and less efficient than large, centralised stand-alone batteries,” Mendoza told Eco-Business.
“It significantly hikes up the initial investment. Without a clear tariff for ‘stored’ energy, some projects may become unbankable. It will be required a new round of educating bankers and the financial community on technical variables and offtake contracts,” he added.
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When you force every 10MW plant to have its own battery, you end up with fragmented, sub-scale storage units. It’s often more expensive and less efficient than large, centralised stand-alone batteries.
Ping Mendoza, president and board member, Philippine Solar and Storage Energy Alliance (PSSEA)
Mendoza, also the Philippne country manager of Gurīn Energy, a Singapore-based renewable energy developer, instead recommended “value stacking” – that is, using one battery system to deliver several services at the same time. This would mean earning multiple revenue streams instead of just one.
With its new policy, he said the DOE might be limiting a battery’s ability to “stack” different revenue streams, noting the need for more flexible, merchant-based storage market where batteries can serve the entire grid, not just one project.
The Philippines is rapidly scaling up its renewable energy pipeline, supported by green energy auctions and more liberal foreign ownership rules.
The country now leads Southeast Asia in committed renewable projects, ahead of Vietnam’s 73 GW target and Thailand’s roughly 5 GW of planned capacity.
Together with Vietnam, it has accounted for the region’s largest portfolio of utility-scale wind and solar, with more than 185 GW – about 80 per cent of Southeast Asia’s announced, pre-construction, and construction-stage capacity.
The Philippines aims to raise renewables’ share in the power mix to at least 35 per cent by 2030 and 50 per cent by 2040 under its National Renewable Energy Programme, even as it continues to develop new gas capacity to secure near-term supply.
