The Philippines will be able to save $9 billion annually by transitioning to a net zero system by 2050, according to Wärtsilä’s global power system modelling, published in the Crossroads to Net Zero report.
“A holistic system-level approach is essential now more than ever to accelerate the Philippines’ energy transition and unlock the potential savings and emissions reductions,” said Frederic Carron, vice president for Middle East and Asia at Wärtsilä Energy.
“By deploying balancing power technologies alongside renewables and energy storage, we can ensure a stable, cost-effective power grid for the country as well as contribute to the global energy transition,” he said.
The report compares two pathways from the year 2025 to 2050 with the aim to reduce greenhouse gas emissions and limit global warming, as per the Paris Agreement targets. In the first pathway, only renewables, such as wind and solar power and energy storage are added to the power mix.
In the second pathway, balancing power generation technologies, that can be ramped up quickly when needed to support intermittent renewables, are also added to the system.
The report said that for the Philippines, which currently relies heavily on fossil fuels for its electricity generation, the transition represents a significant opportunity to enhance energy independence, stimulate economic growth through green job creation and mitigate the impacts of climate change.
The results from Wärtsilä’s global modelling report are in line with findings from the previous modeling for the Philippines in the Rethinking Energy in Southeast Asia report of significant savings from a net zero system.
The report said that with the right mix of renewable generation and balancing technology, Luzon can double its clean energy generation by 2040. For each gigawatt of renewable capacity, around 150 megawatts of flexible balancing power plants are necessary to ensure stability.
The modelling shows that a power system including balancing power has significant advantages when it comes to both cost and carbon dioxide reductions.
The model reveals that this pathway would generate cumulative savings of 65 trillion euros by 2050 compared to a renewables-only pathway, due to less renewable capacity needed. This would average EUR 2,5 trillion per year — an equivalent to over 2 percent of 2024’s global GDP.
The Wärtsilä report outlines that the effectiveness of renewables can be maximized if supported by balancing power plants, which are key in scaling up renewable energy.
Wärtsilä is a global leader in innovative technologies and lifecycle solutions for the marine and energy markets.
