As the Philippines pursues energy transformation, we must prioritize what matters most: ensuring a reliable and secure power supply for our nation.
While the country has committed to ambitious renewable energy targets—35% by 2030 and 50% by 2040—these goals must be pursued within a framework that places energy security at its core. The transition to renewable energy carries substantial hidden costs that must be carefully weighed against our development priorities.
As we at the Center for Energy Research and Policy (CERP) consistently emphasize, a nation’s development and resilience depend first and foremost on its ability to maintain a stable and dependable power supply.
The first major hidden cost stems from the inherent variability of our primary renewable options. Solar and wind power, despite their promise, cannot yet guarantee the consistent power supply our economy demands. When clouds gather or winds fall still, power generation fluctuates, potentially compromising the baseload power essential for our industries, hospitals, and daily lives. This intermittency requires substantial backup power investments, adding significant system costs that ultimately affect consumer prices. While battery storage systems offer a potential solution, their implementation costs run into billions of pesos, requiring substantial investment and technological expertise that must be weighed against immediate energy security needs.
Our grid infrastructure demands equally costly upgrades. The National Grid Corporation of the Philippines must undertake extensive modernization to accommodate renewable energy sources without compromising system stability. These essential upgrades are estimated to cost hundreds of billions of pesos over the next decade. Without these crucial upgrades, the integration of variable renewable energy sources could lead to increased power outages—a direct threat to energy security. More concerning still, some of our most promising renewable energy sites lack basic transmission infrastructure, requiring additional billions in investment to connect these resources to the grid.
The territorial aspects of renewable energy projects introduce significant compensation and social costs. These installations require vast tracts of land, often leading to conflicts with local communities and indigenous peoples. Such conflicts can delay or derail energy projects, potentially impacting our ability to maintain a secure power supply and adding substantial risk premiums to project financing. As we pursue environmental sustainability, we must ensure that our energy security isn’t compromised by protracted land-use disputes.
The environmental and social costs of renewable technology production translate into real financial burden. The mining operations required for solar panels and wind turbines raise important questions about resource security and environmental impact. The projected demand for silver alone—estimated to exceed 50% of global reserves by 2050—will drive up equipment costs significantly. Additionally, end-of-life disposal and recycling of renewable energy equipment represents a future cost that is often overlooked in current planning.
This doesn’t mean we should abandon our renewable energy aspirations. Rather, we must pursue them within a hierarchy of energy priorities: security first, followed by affordability and sustainability. A balanced strategy must invest in grid modernization and energy storage solutions while ensuring robust protections for indigenous rights and local communities. This approach should encompass responsible mining practices and create an energy framework that prioritizes security while advancing sustainability goals.
As CERP advocates, the path to a resilient energy future requires careful consideration of all these factors. The true cost of renewable energy transition extends far beyond the headline equipment prices, encompassing grid upgrades, land acquisition, community support, and system reliability investments. Our renewable energy goals are achievable, but their pursuit must not compromise the fundamental requirement of energy security. Only through methodical planning, inclusive dialogue, and responsible implementation—with energy security as our guiding principle—can we create an energy landscape that truly serves all Filipinos.
(Noel Baga is the convenor of the think tank Center for Energy Research and Policy.)