The Market Monitor Minding the Nation's Business
To say that the Philippines has strong potential in harnessing renewable energy (RE) is an understatement.
It is widely reported that the RE sector is comprised of geothermal resources (14.6%/1,932 MW), solar/wind energy (1.4%; solar at 1,382 MW; wind at 443 MW), hydropower (4.1%/1,161 MW), and biomass (12.6%/759 MW).
The Department of Energy (DOE) has instituted policies that would encourage private domestic and foreign investments to drive growth in the green energy industry and reduce the dependence on expensive energy imports. Policies include RE portfolio standards, net metering, green energy option/auction programs, and the RE market trading system. In November 2022, the Philippine government opened RE projects to 100% foreign ownership to allow faster entry of RE investments.
As this developed, it was reported that some $4 M in initial funding has been pledged for a United Nations-backed program aimed at helping Southeast Asia, including the Philippines, shift to cleaner energy without slowing economic growth.
The UN Economic and Social Commission for Asia and the Pacific (Escap) said the three-year Energy Transition for Green Growth and Prosperity initiative, set to begin in 2026, will be supported by pledges from ClimateWorks Foundation, Sequoia Climate Foundation, Children’s Investment Fund Foundation and Tara Climate Foundation.
Escap said the program will focus on strengthening long-term energy and industrial planning, expanding regional power interconnections and mobilizing more green finance.
It will initially roll out in Southeast Asia, where Escap said it aims to help governments align climate targets with job creation and industrial growth while developing a pipeline of investment-ready clean energy projects.
Escap Executive Secretary Armida Salsiah Alisjahbana said governments in the region are under pressure to cut emissions while keeping economies stable and competitive.
“Countries around the region are considering how to reduce emissions while safeguarding growth, jobs, economic resilience and social inclusion. Governments must navigate this transition under multiple constraints—legacy infrastructure, limited fiscal space, evolving regulatory environments, varying institutional capacity, and persistent financing gaps,” Alisjahbana said.
Data from Escap showed that the Asia-Pacific accounts for about 60 percent of global greenhouse gas emissions and produces roughly 80 percent of the world’s coal.
At the same time, the region’s energy demand is projected to continue rising sharply in the coming decades.
In 2024, the Climate Change Performance Index also noted that renewable energy development in Southeast Asia remains weak, with most countries scoring poorly in terms of the share of renewables in their energy mix.
Only Vietnam and Indonesia received a medium rating, scoring 10.6 and 10.5, respectively. The Philippines scored 6.6 and was rated low, followed by Malaysia at 6.1 and Thailand at 4.7.
Escap said it expects the initiative to improve policy coordination, strengthen investment readiness and expand access to public and private capital for clean energy and related infrastructure.
“Lessons from participating countries will shape regional energy policy dialogue, supporting governments to accelerate energy transitions and strengthen cooperation on clean energy, grids and enabling finance across Asia and the Pacific,” it added.