The coal moratorium enforced in 2020 which sculpted the entry of more renewable energy (RE) investments remains as a non-negotiable policy stance to former Energy Secretary Alfonso G. Cusi if he will have his way, because that had drawn the line in the sand for the country’s greener future.

In a statement to the media, Cusi defended that the halt in coal plant investments was “a well-considered policy move,” as he reproached those who have been labeling that now as a ‘failure.’

“The recent grid alerts should not be hastily attributed to the coal moratorium without solid evidence.,” the former energy chief stressed.

He schooled critics that “it’s crucial to understand that while the moratorium applied to new greenfield coal-fired power projects, existing brownfield and expansion initiatives, including those with secured financial backing, remained unaffected. Therefore, any delays or setbacks in these projects cannot be directly linked to the moratorium.”

Given the parameters set forth in the coal moratorium, Cusi highlighted that there is still room for additional baseload coal capacities that can be built by qualified power project developers – these would apply to coal projects that already started with permitting and other pre-development activities prior to the issuance of the moratorium roughly four years ago – and the best candidates are those opting for capacity expansions.

The former DOE chief reiterated “the rationale behind the moratorium was rooted in the imperative need for a more agile and adaptable power generation landscape,” adding that “at the time of its implementation, the grid boasted sufficient baseload capacities but required greater investments in mid-merit and flexible power generation capabilities.”

While more than 3,000 megawatts of coal capacities can still be implemented amid the coal moratorium’s restraints, it had been apparent that even developers consciously decided to stop building because of intensifying perception that this technology is turning out to be a liability on the balance sheets of investors – and those developments in the investment landscape rendered coal not just a morally questionable choice on environmental perspectives but it has also been turning out to be financially risky for company-sponsors.

As banks and other lending firms have turned their backs on funding new coal plants, a seismic shift on investment preference also shaped for the energy sector globally – with most countries opting for a transition to renewable energy (RE) and other cleaner technologies due to climate change consequences; hence, treating coal ventures as anachronistic or one that will ultimately be doomed for technology obsolescence.

Nevertheless, in the case of the Philippines which is constantly tangled with power supply mess, coal is a solution that some players are re-embracing for capacity additions moving forward.

To date, it is Aboitiz Power that has re-ignited coal capacity expansion in the Visayas grid; while Meralco PowerGen, the power investment arm of Manila Electric Company (Meralco) is similarly sorting out option for a possible greenfield coal plant in Atimonan, Quezon – which is somehow a diversion from the energy transition being pushed under the Marcos administration.

Still, Cusi contended that “the moratorium aimed to align with this transition while upholding the reliability and stability of the grid,” adding that “encouraging inflexible power generation such as coal contradicts this strategic shift.”

He asserted “central to the moratorium's objectives was the enhancement of grid reliability by augmenting the power system's capacity to withstand disruptions while optimizing overall grid operations. It sought to bolster the power system's responsiveness to fluctuations in demand and supply, facilitating the seamless integration of emerging technologies into the grid infrastructure.”

The former energy chief similarly cited recent announcement from the Department of Energy (DOE) on more than 4,000MW of RE and gas-fed power facilities that are coming on commercial stream within this year – a development that will help solve supply predicaments that wobbled Luzon and Visayas grids in this year’s El Niño-stricken summer months.

"These investments underscore the tangible outcomes of policy adjustments made during our tenure, demonstrating a tangible shift towards more sustainable and flexible energy solutions," Cusi noted.