LONDON, United Kingdom — The Philippines is a rising economic force in East Asia, with a growth rate second only to China. Following its recent relaxation of laws limiting foreign investment in renewable energy, the U.K. has announced a new green energy partnership with the Philippines. This new agreement to develop renewable energy in the Philippines has the potential to provide economic prosperity in both nations and to achieve a shared humanitarian goal to decrease the number of Filipinos suffering in extreme poverty.
New Renewable Energy in the Philippines
In a visit to the capital, Manila, in late March 2023, the U.K. Minister for Indo-Pacific Anne-Marie Trevelyan announced new British Investment Partnerships (BIP) to finance renewable energy in the Philippines. The BIP is a new strategy from the British Government that promises £8 billion in development funding by 2025, with a core focus on building green infrastructure in low and middle-income countries.
As well as being a rapidly growing economy, the Philippines’ geographical and topographical profile makes it a natural suitor for the BIP. It is already making use of the advantages of being an archipelago nation. In 2021, 21% of its total power generation was from renewables, with a target of 50% set for 2040.
There is the potential for an impressive 246 (GW) of renewable energy production in the Philippines. This includes the world’s third-largest geothermal capacity, with only the U.S. and Indonesia ahead.
The BIP will expand the U.K.’s investment in green energy in the Philippines to help accelerate its transition to renewable energy. The U.K. has already announced a £25m grant to build the nation’s first-ever solar plant on Negros Island.
Impact – Ending Poverty
The BIP is the latest part of the British development strategy that intends to promote stable and prosperous economies that could allow nations to lift themselves out of poverty whilst simultaneously providing economic growth and job creation in the U.K.
In the case of the Philippines, the negative impact of COVID-19 has caused a new urgency to meet sustainable development goals. The pandemic partly reversed an era of progress that reduced poverty by two-thirds from 1985 to 2018, with the poverty rate in 2021 increasing to 18.1%.
The Renewable Energy Act of 2008 that kickstarted the Philippines’ transition towards green energy identified the social-economic development of rural areas as a core focus of the nation’s energy policy. Although this has achieved success there is still some way to go, with many rural Filipinos still relying on “firewood for cooking and heating.”
The transition to renewable energy in the Philippines will also have a considerable health benefit by reducing air pollution levels, which are currently five times worse than the World Health Organisation (WHO) recommendations and cause 32% of all deaths from heart disease and stroke.
Although it is impossible to estimate the precise impact it will have on poverty levels, British investment in renewable energy in the Philippines will help to provide citizens with a cheaper, safer and more reliable source of energy to power their homes.
The complexity and multifaceted nature of extreme poverty means it cannot be solved just at the state level – it also requires localized efforts. As well as the work done by international development bodies, many organizations work locally to end poverty in the Philippines.
Entrepreneurs du Monde, a small French public interest association that focuses on providing solar power for Filipinos living in extreme poverty, is one example. It focused on communities living in the slums of Manila and in rural villages that lack access to electricity. Instead, they rely on kerosene lamps, torches and candles to light their homes, which are dangerous, ineffective and expensive.
This project aims to provide households with solar kits that gave families access to high-quality, unlimited and free lighting for over 240 households. Smaller-scale operations like this illustrate the transformative power that renewable energy in the Philippines has to lift people out of extreme poverty.
The BIP ushers in a new era of energy partnership between the U.K. and the Philippines that will not only provide jobs and prosperity for people in the UK but will also change many Filipino lives for the better.
– Henry Jones