The Philippines is implementing energy-conservation directives, including measures that could lead to greater reliance on coal-fired generation, as part of a broader energy conservation drive after the country declared a state of emergency on 25 March following supply disruptions caused by the US-Iran war.
President Ferdinand Marcos launched a 20bn Philippine peso ($33.2mn) emergency fund on 26 March to strengthen fuel security in times of volatility in the global energy and freight markets caused by the war. The Philippines is a net importer of coal, oil and LNG.
The P20bn emergency fund, managed under the department of energy's (DOE) emergency energy security programme, will support the stockpiling of up to 2mn bl of fuel to meet domestic requirements and reduce the impact of supply disruptions. This includes the procurement of refined petroleum products such as LPG to build inventories. The DOE will also ensure stable fuel inventories at utilities to support electricity generation.
The DOE also seeks to minimize external supply shocks for utilities and ensure full capacity utilisation at power plants in line with its goal of boosting power system efficiency. An increase in coal-fired generation within the overall power mix could cushion an increase in wholesale electricity spot market (WESM) prices and help in saving up to P2/kWh, the DOE said. This comes as an initial projection by the independent electricity market operator (IEMOP) indicate that average power prices in the WESM could exceed P9/kWh, from an average of up to P5/kWh before the onset of the US-Iran war. Coal accounted for 54.6pc of power generation in February, IEMOP data show.
The DOE's emergency measures to secure power supply could increase utility demand for both domestic and imported coal, although it was not immediately clear if the directives would curb coal exports from the country.
"As a net importer of oil, coal and LNG, we are acting with heightened discipline to preserve power system reliability in the face of escalating global fuel market volatility," the country's energy secretary Sharon Garin said today.
"This is a decisive intervention to protect the grid, manage fuel use responsibly and ensure that essential electricity services remain uninterrupted," she added.
The DOE has ordered power generators to closely monitor fuel inventories and comply with the 15-day supply requirements. Utilities have also been instructed to explore fuel alternatives to reduce costs and ensure adequate supplies. Potential steps include using higher biodiesel blends in oil-based power plants, blending different coal grades, and increasing co-firing of biomass where possible at coal units.
The country will rely more heavily on coal-fired output, Garin had said during a press briefing on 24 March.
Most of the Philippines' power generation depends on seaborne imports from Indonesia. Nearly all of Philippines' coal imports in 2025 were from Indonesia, with shipments reaching 37.4mn t, according to the customs data.
The country's reliance on Indonesia also exposes it to supply uncertainty, as Jakarta has yet to confirm mining production quotas for 2026 at the time of writing. Garin met Indonesia's ambassador earlier to seek assurance of steady supply, saying on 24 March that there are "no restrictions on imports of coal from Indonesia at this moment."
