Industry Trend Analysis - Coal Power To Drive Energy And Utilities Infrastructure Growth - MAR 2018

BMI View: Sustained investments in coal-fired power plants will be an important driver of growth in the Philippines' energy and utilities infrastructure sector. Although global regulatory and financing conditions continue to undermine coal power, the appeal of coal lies in its low costs, readily available technology and fast implementation period - all of which are essential for meeting the Philippines' growing energy demands.

Coal-fired power plants will continue to form an integral component of the Philippines' power mix, and contribute to strong investment and construction activity in the country's energy and utilities infrastructure sector. Despite international regulatory and financial tides gradually shifting away from coal-fired power sources, coal remains in favour in the Philippines thanks to its low cost and technological requirements and the potential for fast construction timelines to meet rising power demands. According to the Department of Energy's 2009-2030 Power Development Plan, the Philippines will require an additional 12,300MW of generating capacity by 2030, the majority of which will come from coal-fired sources.

Our Key Projects Database records more than 7,300MW worth of power plant capacity currently under, or approved for, construction; nearly 80% of this upcoming capacity comes from coal-fired sources. The rise of coal will be particularly pronounced in the less-developed southern regions of Mindanao and Visayas, which have historically relied on renewable sources but are now facing demand pressures stemming from economic and industrial growth. We forecast that the Philippines' energy and utilities infrastructure sector will grow at an annual average of 8.7% between 2018 and 2027.

Power Dominates Energy and Utilites Value
Philippines - Energy and Utilities Infrastructure Forecasts
e/f = BMI estimate/forecast. Source: National Sources, BMI

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