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In 2024, the Philippine Department of Energy (DOE) issued the revised and updated Philippine Energy Plan (PEP) 2023-2050, a comprehensive blueprint of its transformative vision of a clean energy future. The Marcos administration has set its sights on an efficient transition ensuring that every Filipino will enjoy a more reliable and equitable energy ecosystem.

While previous PEPs appeared to pay only lip service to the shift to renewables, the current DOE leadership has declared the critical role that renewable energy (RE) plays by formulating policies that incentivise innovation and facilitate investment. The DOE has targeted increasing RE¡¯s share of the power generation mix to 35% by 2030, 50% by 2040, and more than 50% by 2050.

These aggressive targets set the Philippines¡¯ increase in RE for 2021-2040 to 52,826 megawatts (MW) of new RE capacity, broken down into 364MW for new biomass, 2,500MW for new geothermal, 27,162MW for new solar, 6,150MW for new hydro, and 16,650MW for new wind. To meet its objectives, the Philippines has implemented various policy reforms, foremost of which is the opening up of RE to 100% investment by foreign nationals through a Department of Justice confirmatory opinion.

At the centre of its aggressive transition is the push for offshore wind (OSW), with the Philippines having conditions that are well suited to such development. In 2020, the World Bank completed the Offshore Wind Roadmap, estimating the Philippines¡¯ total potential OSW to be 178 gigawatts (GW), a significant number compared to the country¡¯s total generation capacity of around 28GW in 2022. The roadmap identified six potential offshore wind development zones around the country¡¯s coast that have technically extractable wind resources. The World Bank study has spawned numerous applications leading to 92 wind energy service contracts being awarded, with a total capacity of 68GW as of 2024.

Executive issuances

To support the push for OSW development, various Philippine government agencies issued necessary regulations. On 19 April 2023, Executive Order 21 (EO 21), entitled Directing the Establishment of the Policy and Administrative Framework for Offshore Wind Development, was signed by the president, directing the DOE to issue a policy and administrative framework for the development of OSW.

The ultimate goal of EO 21 is the integration of all permit requirements for OSW development. As a response to EO 21, the DOE issued department circular No. DC2023-05-0013 on 18 May 2023, which promulgates the implementing guidelines of EO 21. On 18 January 2024, the Department of Environment and Natural Resources (DENR) issued administrative order No. 2024-02 provided the Interim Guidelines for Environmental Compliance Certificate (ECC) under the Philippine Environmental Impact Statement System for OSW Energy Projects, which aims to ensure that OSW development is done in the most environmentally sustainable manner.

In October 2024, the DOE and DENR signed a memorandum of agreement (MOA) granting rights to use offshore areas covered by offshore wind energy service contracts, including auxiliary areas to accelerate the development of OSW projects. The MOA specifically allows access to both offshore and auxiliary areas during the pre-development, exploration, development and commercial development phases, subject to necessary DENR requirements. This landmark agreement streamlines the process of exploring and developing offshore wind projects, while ensuring that environmental safeguards are in place at every stage.

Multilateral support

In 2024, the Asian Development Bank (ADB) completed a study into the repurposing of 10 ports as infrastructure for OSW development, and the DOE partnered with the Philippine Ports Authority to pursue the upgrading of port facilities. The ADB also supported the Energy Regulatory Commission in its study into the appropriate level of auction price for OSW projects.

Meanwhile, the UN Office for Project Services, with support from the Southeast Asia Energy Transition Partnership, and through a consortium of advisers, completed the Marine Spatial Plan to accelerate responsible development of offshore wind and the wider marine RE sector in the Philippines.

Capping push with auctions

The DOE has already announced Green Energy Auction (GEA) 5 exclusively for OSW projects by the third quarter of 2025. This demonstrates the Philippine government¡¯s commitment to large-scale RE projects. As investors await the issuance of the notice of auction and terms of reference for bidding, GEA 5 will hopefully catalyse the development of OSW and cement the Philippines¡¯ position as an RE champion and leader in the Asean region.

Jose M Layug Jr is a senior partner at DivinaLaw in Metro Manila