The Philippine energy sector remains a magnet for local and foreign investors despite lingering multibillion-peso corruption in infrastructure, particularly in flood-control projects, according to top energy officials.
‘I’m still very bullish about investments in energy in the Philippines, as shown by the oversubscription in GEA (green energy auction),’ Energy Secretary Sharon Garin said in an interview.
Garin, who engaged in high-level forums in Singapore last week, said ‘many investors from all over the world’ expressed strong interest in pouring capital into the Philippines.
‘So I think it’s still very positive, and I don’t think it’s anything to worry about as far as energy is concerned,’ she said, brushing off concerns over the corruption issues in the country.
Garin said the ongoing probe into flood-control projects, spotlighted by President Marcos during his July State of the Nation Address, has signaled to investors the administration’s serious stance against corruption.
Citing an initial report from the Department of Public Works and Highways, Marcos revealed in August that P545 billion in public funds has been allocated to flood-control projects nationwide since July 2022.
Notably, 15 contractors secured 20 percent or around P100 billion of these projects over the past three years.
Faced with rising public outrage, Malacañang established the Independent Commission for Infrastructure to investigate alleged corruption, irregularities and misuse of funds in government projects within the decade.
‘So I think for our investors, that should be an assurance that the current administration is being very transparent,’ Garin said.
Unlike other industries in the Philippines, energy is largely privatized, with the Electric Power Industry Reform Act unbundling it into four distinct segments – generation, transmission, distribution and supply.
In 2022, the government opened the country’s renewable energy (RE) sector to full foreign ownership, which was previously subject to a 40-percent cap.
Latest Department of Energy (DOE) data showed that fully foreign-owned companies already bagged around 20 gigawatts of RE projects.
Beyond renewables, Energy Undersecretary Felix William Fuentebella said foreign investors are also exploring opportunities in the Philippines’ upstream energy sector.
‘As far as policies are concerned, they (investors) also told us that the policies in the Philippines and fundamentals are in place. So it’s very predictable,’ Fuentebella said.
Just last month, the government awarded $207 million worth of petroleum service contracts in a bid to ramp up local production and reduce the country’s oil import dependence.
The contracts cover exploration areas across Cagayan, Cebu, Palawan, Central Luzon and the Sulu Sea.
According to Garin, the DOE is also in talks with Abu Dhabi regarding potential investments in the Philippine upstream sector.
‘So I think they are aware it’s private-driven, and it’s not about corruption per se. So it’s more like we’re just establishing ourselves as good policy makers as far as energy is concerned,’ she added.