Technology group Wärtsilä is calling for urgent action to enable more flexibility in power systems in the Philippines, as we reach a crucial renewable energy tipping point.
In the Philippines, the government published the National Renewable Energy Program (NREP) 2020–2040, providing the strategic building blocks to decarbonise electricity by increasing renewable energy production and investment. The NREP has set a target of 35% renewable energy by 2030 and 50% by 2040 . 

At COP28, the United Nations Framework Convention on Climate Change (UNFCCC) agreed to transition away from fossil fuels and triple renewable power by 2030, which would make this tipping point even more pronounced.

Renewable energy will become the world’s largest electricity source by 2025 , and it is vital that flexible technologies are deployed at scale and pace to support that transition to avoid widespread curtailment, increased prices, greater fluctuations, and higher emissions.

Kari Punnonen, Energy Business Director, Australasia, Wärtsilä Energy, said: “We stand at a tipping point, with unprecedented levels of renewables being added in the Philippines over the next decade and huge volumes of traditional inflexible assets on the cusp of retirement.

“Over the past decade we have transitioned from renewables requiring financial support, to a position where inflexible assets, such as oil, coal, CCGTs (combined-cycle gas turbines) and nuclear are no longer viable without political support.
“This presents us with a unique opportunity: to add more renewable energy than ever before on to our grids, build the right level and right type of flexibility into our power systems and phase out inflexible assets while converting to sustainable fuels. Ultimately this will ensure a transition that fully phases out fossil fuels and is affordable, low carbon and resilient.

“The decisions that we make today in designing our power systems will echo for generations, as we aim to tackle climate change and embed the right technologies to accelerate the deployment of renewables.”

To ensure we address this tipping point, Wärtsilä is calling on policy and decision makers to:

1. Choose the right technologies to accompany renewables, including grid balancing engines and energy storage to enable and accelerate the energy transition.
2. Enable and encourage flexibility through regulations and policies that incentivise investments in flexible generation assets. 
3. Increase or complete removal of the secondary price cap in the Wholesale Electricity Spot Market (WESM) to accurately reflect the true price of power scarcity and provide a proper price signal for investments in flexibility.

Choosing the right technology
According to IEA World Energy Outlook report, gas generation will increase 1% by 2030 and decrease 5% by 2050 (TWh)  , however global utilisation and the emissions from the sector will drop significantly, as we reach an additional energy tipping point. Gas will increasingly shift from providing baseload power to providing flexible and firm capacity for real-time and seasonal renewable balancing. 
To determine the optimal power mix for the Philippines, Wärtsilä conducted advanced power system modelling. The results indicates that Luzon should scale up renewables, while rapidly accelerate the adoption of flexible gas-based balancing plants, with 1.3 GW needed by 2030 . By doing so, the island of Luzon can level up renewable energy, such as solar and wind, to become the main source of energy, enabling the Philippines to reach the goals set by the NREP.

However, not all flexible generating assets are created equal. Inherently wind and solar power is intermittent, so flexible assets are required to manage minute-level, daily and seasonal variations in renewable generation, to ensure the lowest carbon and most cost-effective power systems.

Engines are the optimal flexible power generation technology choice in a five-minute market, as they: 

• Can outperform gas turbines when dispatched in real-time markets (i.e. 5-minute power trading intervals). 
• Can run on sustainable fuels once they are available for the energy sector and can switch seamlessly between different fuels. 
• Can ramp up in two minutes to support or balance intermittent renewables. 
• Have no minimum uptime or downtime and can start / stop as many times as needed with no additional cost or impact on maintenance.
  
• Have high full load efficiency and can maintain it across a wide range of outputs.
  
• Can operate at loads as low as 10%, making them ideal for providing spinning reserve.
  
• Can reduce curtailment.

Kari Punnonen continued: “Grid balancing engines will play a vital role in bridging to higher renewable systems, as they are the most efficient power generation technology to support intermittent wind and solar. In the future they can run on sustainable fuels to create 100% renewable power so there is no chance of stranded assets. Fuel flexibility is vital for ensuring a dependable source of electricity.
“We have all the technologies required to achieve net zero. It is essential that the correct incentives and policies are put in place today, to enable the deployment of flexible technologies and keep costs and emissions low, while shaping the power systems of tomorrow.”


Media contact:

Neelayam Sorte
Marketing & Communications Manager, Middle East & Asia
Wärtsilä Energy
Mob: +91 70 45476881
neelayam.sorte@wartsila.com

All Wärtsilä releases are available at www.wartsila.com/media/news-releases and at news.cision.com/wartsila-corporation where also the images can be downloaded. Use of the image(s) is allowed only in connection with the contents of this press release. Wärtsilä images are available at www.wartsila.com/media/image-bank.

Wärtsilä Energy in brief
Wärtsilä Energy leads the transition towards a 100% renewable energy future. We help our partners to accelerate their decarbonisation journeys through our market-leading technologies and power system modelling expertise. These cover decarbonisation services, future-fuel enabled balancing power plants, hybrid solutions, energy storage and optimisation technology, including the GEMS Digital Energy Platform. Wärtsilä Energy’s lifecycle services are designed to increase efficiency, promote reliability and guarantee operational performance. Our track record comprises 79 GW of power plant capacity and 125 energy storage systems delivered to 180 countries around the world.
www.wartsila.com/energy

Wärtsilä in brief
Wärtsilä is a global leader in innovative technologies and lifecycle solutions for the marine and energy markets. We emphasise innovation in sustainable technology and services to help our customers continuously improve environmental and economic performance. Our dedicated and passionate team of 17,800 professionals in more than 280 locations in 79 countries shape the decarbonisation transformation of our industries across the globe. In 2023, Wärtsilä’s net sales totalled EUR 6.0 billion. Wärtsilä is listed on Nasdaq Helsinki.

www.wartsila.com