World Bank, DOE roadmap shows Philippines has over 21GW offshore wind potential by 2040

The World Bank and the Department of Energy (DOE) on Wednesday launched a roadmap for the Philippines’ offshore wind power, showing the country's potential to develop its offshore wind industry and augment the growing demand for electricity.

In Offshore Wind Roadmap for the Philippines, the multilateral lender and the DOE outlined two possible growth scenarios for the country’s offshore wind sector.

“The purpose of these scenarios is not to set installation targets but rather to demonstrate and quantify the potential effect of industry scale on cost, environmental and social risks, and economic impact,” the roadmap read.

The two development scenarios are “low growth” and “high growth.”

The low growth scenario provides a roadmap for installing offshore wind at levels in line with the DOE’s national renewable energy program, and the high growth scenario provides a roadmap for installing much higher levels that could be sufficient to drive competition, investments, and more cost reduction, the World Bank said in an accompanying news release.

Under the low growth scenario, the roadmap suggests that the Philippines has the potential to install 3 GW of offshore wind by 2040, making up 3% of the country’s electricity supply.

For the high growth scenario, the roadmap shows the potential to install over 21 GW of offshore wind power, in which offshore wind supplies 21% of the Philippines’ electricity needs by 2040.

“Both growth scenarios could deliver substantial benefits to the Philippines; however, results indicate that the high growth scenario could deliver disproportionately larger economic benefits with a lower cost of energy,” the roadmap read.

The roadmap said that the high growth would result in the following:

•     Faster cost reductions—32% lower LCOE (lower cost of energy) for offshore wind electricity by 2040, caused by market scale, increased local capabilities, and quicker risk reduction
•     Over 13 times more local jobs and value added to the economy by 2040.

Under the high growth scenario, the roadmap projects that the local gross value added to the economy by 2040 would be $14.4 billion, 13.1 times higher than the $1.1 billion gross value added under the low growth scenario.

Likewise, the local employment under the high growth scenario would be 205,000, compared to the 15,000 jobs to be created under the low growth scenario.

“Provided that clear, long-term targets are set, the larger scale of the high growth scenario would lead to more investment in the local supply chain, thereby increasing the economic benefits and reducing costs,” according to the roadmap.

To achieve these scenarios, the World Bank said the roadmap provides guidance on actions that must be taken by the government, putting in place a long-term plan for offshore wind until 2050 as part of a decarbonized energy mix; establishing offshore wind development zones through further marine spatial planning; investment in transmission, port and other energy infrastructure upgrades; increasing collaboration with industry and other relevant government agencies; among others.

“The Philippines has a rapidly growing demand for power,” said Energy Secretary Alfonso Cusi.

“It is clear from this roadmap that offshore wind can play a major role in meeting our country’s energy demand indigenously, while also accelerating decarbonization,” added Cusi.

“Our analysis of the high growth scenario suggests that offshore wind power could create thousands of jobs by 2040, as well as provide billions in local gross value added to the economy in the Philippines,” said Jie Tang, World Bank energy practice manager for East Asia and Pacific Region.

Ndiamé Diop, World Bank country director for Brunei, Malaysia, Philippines, and Thailand, said that with the roadmap, the Philippines is taking its first step towards building an offshore wind industry and contributing to national energy security and global efforts to mitigate climate change.

“The Philippines’ waters have conditions that are well-suited to offshore wind. This abundant, indigenous energy resource offers an opportunity for the Philippines to boost energy security, reduce greenhouse gas emissions, and increase renewable energy supply,” added Diop.—AOL/VBL, GMA News