The World Bank said the thriving big-ticket offshore wind (OSW) projects in the Philippines should attract major investments in manufacturing, especially for products and equipment that will support deployment of technology installations in the renewable energy (RE) space.

Mark Leybourne, Offshore Wind Program Lead of the World Bank, said in an interview that the interest of investors for manufacturing will largely depend on how the country could eventually concretize the capacity-installations targeted for offshore wind ventures.

“It all depends on how big the industry is going to be – that will determine investments into local manufacturing; and whether it will make sense to come here and make factories,” he said; adding that if the eventual capacity reaching commercial operations would just be marginal, “then it’s very hard to build factories.”

He expounded “if there’s a large vision and we’ve put that in the roadmap for the Philippines, then you would get more jobs and you can get investors setting up factories.”

Leybourne emphasized that even if offshore wind investments would not reach a scale that will justify the entry of manufacturing facilities, it would still be a job generating proposition for the country, primarily for those involved in operation and maintenance (O&M), project developments and construction, project financiers and other facets of employment needed in advancing a project to commercial operations.

Within Southeast Asia, he said Vietnam is Philippines "tough competitor" when it comes to cornering investors and capital for offshore wind investments because is a market pursuing parallel developments on this RE technology domain.

“The two big markets here would be Vietnam and Philippines. I wouldn’t say one is ahead, they have their merits and challenges,” he stressed.

For the Philippine market, he said, there have been positive developments in the identification of sites for massive OSW potential, as well as the recent declaration of the Department of Energy (DOE) on streamlining project permitting in the sector.

“We’ve had set of recommendations in the roadmap with actions the government and the other stakeholders need to undertake to deliver offshore wind. Some of those are being addressed now and it’s really important to see dialogue happening, because it’s involving every single part in government, from fishing to aviation to natural resources to the electric grid and the creation of jobs,” Leybourne said.

In mapping out offshore wind development prospects in the Philippines, the World Bank Group specified at least six major challenges that the government and the interested investors would need to address, including those on: energy costs; transmission or wheeling of generated electricity; environmental and social (E&S) impacts; limited local supply chain; financing and bankability of projects; as well as project ownership barriers.

When it comes to ownership restriction, that has already been resolved with the recent issuance of a DOE Circular allowing 100-percent foreign equity on RE projects and that served as an amendment to the policy which was first instituted in the implementing rules and regulations (IRR) of the Renewable Energy Act.

On project funding, the World Bank executive stated “there’s a need for de-risking investments” but that is a concern that shall be addressed by policymakers and regulators of the country’s energy sector.