The promise of renewable energy amid the multiple crises Filipinos are enduring as a result of the Middle East conflict remains fraught with challenges. It cannot be solved simply by replacement.

In yesterday’s Straight Talk online program of the DAILY TRIBUNE, MGen Renewable Energy Inc. president Dennis Jordan said a “chicken-and-egg” dilemma exists in the sector, in which limitations hinder RE production in the transmission grid.

Concessionaire of the transmission grid, National Grid Corporation of the Philippines (NGCP), however, obtained approval from the Energy Regulatory Commission for additional charges to recoup P32 billion in investments needed for the upgrade.

The petition, of course, is for a pass-through collection, which will be reflected in consumers’ monthly bills through staggered collections, adding to the rise in power costs.

Last May, two key transmission projects totaling approximately P32.02 billion were authorized for recovery from consumers over time through regulated transmission charges which, under EPIRA, fall under the “cost recovery” mechanism.

The projects will have to keep pace with the trend towards indigenous and renewable sources, since apprehensions about the network’s ability to absorb renewables persist.

“As we add more renewable energy, the grid must become more stable and resilient,” according to Jordan.

He added that the transmission system must be capable of absorbing additional capacity, which means continued investment in grid infrastructure, including more substations.

In more developed countries, transmission is often the bottleneck for renewable expansion.

Several countries pursuing aggressive transitions to renewable energy, primarily solar and wind, have encountered significant challenges as their power grids, designed for centralized, dispatchable electricity generation, proved ill-equipped to handle the variable, often decentralized influx of electricity from these sources.

The mismatch leads to grid congestion, renewable energy curtailment where excess generation is deliberately reduced or shut off, system instability and economic inefficiencies.

The core issue was the legacy infrastructure’s inability to absorb, transmit, and balance RE reliably in real time.

Solar energy projects need assured buyers through government auctions, in addition to the grid’s capacity.

The issue with renewables is storage to address intermittency. “That’s why battery systems are important. Battery costs have significantly gone down,” according to Jordan.

“For example, when I started, installing one megawatt of solar cost about $1.2 million. Now it’s around $400,000 to $500,000 per megawatt,” he indicated.

Storage capacity and charging capabilities have also improved, which is where the energy sector is heading.

The combination of photovoltaic panels and batteries extends the generation period up to 13 hours.

“The future is really solar and battery. In other countries, it’s solar, battery, and wind,” he added.

The situation in Iran highlights the importance of RE and battery systems. With LNG prices increasing, costs are rising significantly, affecting coal as well. It is worth considering that LNG is considered the bridge towards RE.

Renewable energy sourced from sunlight and wind, which the country is blessed with in abundance, can help stabilize supply.

The Covid-19 pandemic accelerated the development of remote technology that is now helping increase the pace of business all over.

The Middle East discord, in turn, may become the catalyst for disengaging from imported fuel.