For AboitizPower, A Diversified Strategy is Crucial for Energy Security

At a recent event entitled “Advancing Energy Security: Fueling Sustainable Progress with Liquefied Natural Gas”, organized by the Stratbase ADR Institute and CitizenWatch Philippines, AboitizPower’s Chief Corporate Services Officer, Carlos Aboitiz, advocated for an “all-options-on-the-table” approach to the country’s energy transition.

This diversified strategy maximizes existing traditional capacities, integrates emerging technologies, and combines dispatchable and variable renewable energy, along with battery storage. Striking a balance between sustainable and conventional energy source reliance ensures grid stability and meets electricity demand while gradually reducing carbon emissions.

The Gap Between Energy Insecurity and Independence

Aboitiz emphasized the complexity of the energy sector. “We provide value to society by providing energy when it’s needed at a reasonable cost and with the least adverse environmental impact,” he shared, adding “Sometimes, achieving one objective means compromising on another, making this a supremely difficult job.”

Aboitiz also pointed out the Philippines’ unique challenges, such as an erratic power supply, unsubsidized rates, and the nation’s ambitions to become an upper-middle-income economy.

“In the Philippines, we’re experiencing energy insecurity as evidenced by the many red and yellow alerts. This is the result of demand growing faster than expected, constrained supply growth, and an inadequate transmission and distribution infrastructure,” he explained. 

Aboitiz ventured, “Given our context of energy insecurity, higher than average power prices, and lower than average emissions per capita, we believe that our priority should be to secure our energy system at the lowest possible cost to the consumer.”

The Bridge to Energy Self-Sufficiency

For him, liquefied natural gas (LNG) plays a vital role as a bridge fuel in the energy transition, allowing more local, variable renewable energy sources to be integrated into the grid. It also serves as a bridge to help impoverished Filipinos access modern society.

“Gas is flexible, able to easily ramp up or down as needed, and therefore is a more cost-efficient alternative for mid-merit energy needs and for some ancillary services. It’s also dispatchable, unlike renewable energy, which means it is there when we need it,” Aboitiz said. “It [also] helps us to diversify our upstream fuel supply from coal, allowing for some balance to manage discrete risks to coal supply.”

Only recently, AboitizPower acquired a stake in Chromite Gas Holdings, which plans to obtain a majority interest in two gas power plants with a combined capacity exceeding 2,500 megawatts (MW), as well as an LNG import terminal. Aboitiz emphasizes that while the company is investing in LNG to secure the Philippines’ energy future, it remains committed to developing renewable energy sources to strike a balance between energy security, affordability, and sustainability.

Aboitiz acknowledges, “But it’s also really important to understand that, while we’re focused on LNG today, not one technology is going to solve all these problems to achieve all those objectives. So we have to look at it within the context of a larger energy mix and specific country context.” 

Philippine legislators have also been eyeing LNG as a bridge, proposing a law to accelerate investments in LNG.

More Diversification in the Pipeline

AboitizPower joins other energy experts in advocating for a diversified approach to the country’s energy security.

Aligned with the Philippine government’s renewable energy targets of a 35% share of renewable energy in the country’s energy mix by 2030, and 50% by 2040, AboitizPower aims to build 3,700 MW of new renewable energy capacity, eventually reaching 4,600 MW by 2030. This includes projects in solar, wind, geothermal, hydro, and battery energy storage systems or BESS.

“Everything we do must first be with the consumer in mind — the Filipino in mind, fundamentally — and with that I think we will be successful in both advancing the human transition and the energy transition,” Aboitiz stated.

Source: “All-options-on-the-table” action needed for energy security