Government bureaucracy should not derail the progress of renewable energy development in the Philippines, according to Eric Francia, president and chief executive of power firm ACEN Corporation, who noted that bottlenecks in doing business are not necessarily “red flags”.
“It can improve in terms of cost efficiencies, because [government bureaucracy] can get expensive, but hardly does the ease of doing business in the Philippines become a showstopper on developing projects,” said Francia, speaking at a forum in Makati on Wednesday about barriers to renewable and grid development in the Philippines.
He noted how bureaucracy is present even in advanced markets like Australia, which have very restrictive laws or policies on environmental protection which can “stunt development”.
Francia believes that the country is doing “more right than wrong” when it comes to red tape, except for specific local government units which are “personality-driven”, whereby the mayors tend not to be business-friendly. However, he noted how over time, such areas are eventually going to be a free market that will be more open to investment.
Long, multi‑agency permitting has been identified by researchers as one of the biggest obstacles to renewable energy deployment in the country, even after government efforts like liberalising foreign ownership, introducing the green energy auction programme, and digitising its permitting process.
Eric Francia, president and chief executive of ACEN is flanked by ClientEarth chief executive Laura Clarke (left) and TransitionZero co-founder and chief executive Matt Gray at a forum in Makati City on 25 March. Image: ClientEarth
Sherwin Gatchalian, senator and former chairman of the Senate Committee on Energy, pointed out that the Philippines has “very strict laws” safeguarding Indigenous peoples’ rights and protecting agricultural land that sometimes hamper renewable energy development.
Such laws include requiring developers to secure free, prior, and informed consent from indigenous communities and ensure that prime agricultural areas are not carelessly converted, which could take one to 10 years to be resolved, he said at the forum.
For instance, Gatchalian cited a hydro project of the National Irrigation Authority in the province of Tarlac that is set to generate 49 watts of power for the community but has been stalled for the past 20 years because of pushback from the community.
Hydropower projects in the Philippines have repeatedly faced strong pushback, mainly over impacts on Indigenous peoples’ rights, as the government approved 99 hydropower projects in the mountainous Cordillera region, part of a broader plan to rely on renewable energy sources for 35 per cent of the country’s power by 2030.
“Anywhere developers build all of these projects, they will encounter Indigenous people’s lands and protecting their rights, and that becomes also a complication. We need to balance their rights also with our [country’s] electricity requirements,” Gatchalian said.
‘A clear national direction’
Clear national leadership is vital to keep Philippine businesses invested in the clean energy transition, according to Laura Clarke, chief executive of legal non-profit ClientEarth.
It is “really critical” to give companies the confidence to commit capital and long-term plans to low‑carbon projects.
Tim Guanzon, acting associate director for Japan and Southeast Asia at ClientEarth, echoed the call, saying the Philippines needs a “united front” across the national government to ensure “everybody chips in” to push forward the clean energy transition.
The presence of several specialised bodies and structures that have been created or elevated in recent years to back the Philippines’ renewable energy ambition shows this effort, Guanzon said.
Key renewable energy bodies formed in the recent years include the Renewable Energy Management Bureau (REMB), under the Department of Energy (DOE), created to implement policies and programmes that accelerate clean energy development as well as the National Renewable Energy Board (NREB), an inter‑sectoral body that recommends policies and monitors implementation of the Renewable Energy Act.
