II. The Philippine Energy Plan (PEP)

1. EXECUTIVE SUMMARY (Volume 1: National Energy Plan)

1.1.1 Energy Demand and Supply Outlook

1.1.1.1 Sectoral Demand Projections

Consistent with the 6.6 percent average annual GDP growth target provided by NEDA, it is projected that the national aggregate demand will rise from 216.4 MMBFOE in 2005 to 335 MMBFOE in 2014, for a ten-year average increase of 4.7 percent. Households, transport, industry, commercial entities and agriculture, will drive the energy demand on an uptrend.

Petroleum products used mainly by the transport sector will comprise the bulk of the total final energy demand with an average share of 39.4 percent for the entire planning period. Biomass consumed mostly by the residential sector will follow next with an average share of 38.4 percent. Electricity, coal and natural gas will post an average share of 15.1 percent, 2.7 percent and 2.2 percent, respectively. Alternative fuels such as coconut methyl ester (CME) and ethanol will jointly comprise 2.2 percent.

1.1.1.2 Energy Supply Mix

Targets are set to achieve indicative capacity additions from indigenous energy resources during the ten-year planning period. These include natural gas (1,500 MW), geothermal (220 MW), hydropower (1,212 MW), coal (300 MW), biomass (55 MW) and wind (245 MW).

The country’s indigenous resources are projected to contribute 163.3 MMBFOE, translating to an energy self-sufficiency level of 57.1 percent in 2005. In 2010, the self sufficiency level is targeted to increase to 61.5 percent, translating to a contribution of 229.0 MMBFOE from domestic energy resources. By 2014, energy supply from indigenous resources will reach 261.9 MMBFOE. On the other hand, the country’s dependence on energy imports will continue on a more restrained level at an average annual growth rate of 3.9 percent over the ten-year planning period. Imported energy supply will account for about 42.9 percent of the total energy mix in 2005 corresponding to a volume of 122.5 MMBFOE. By 2010, this will grow to 143.3 MMBFOE and further to 191.1 MMBFOE by 2014.

1.1.2 Sectoral Plans and Programs

1.1.2.1 Power Development Program

The 2005 Power Development Plan (PDP) outlines the country’s indicative supply expansion plan in the next ten years under the EPIRA framework. It aims to provide an integrated roadmap for the industry participants to attain the EPIRA’s overall goal of ensuring reliable and sustainable electricity supply at reasonable prices for the country’s growing electricity demand. The program hopes to invigorate the electric power industry with the infusion of private sector capital and managerial expertise in realizing the installation of new generation capacities and in developing a robust transmission system.