A possible energy trade between the U.S. and the Philippines may help address the country’s growing energy needs. U.S. President Donald Trump first broached the idea during the ASEAN summit in November 2017, per a report by BusinessWorld.
The U.S. has the biggest reserves of coal in the world, with a 381 – year supply, in a Reserves/Production (R/P) ratio. Apart from coal, the US is also the world’s biggest oil and natural gas producer.
Also in November, the White House also called for a global “clean coal alliance” including the Philippines.
In a Manila Bulletin report, David Banks, a representative of Washington at the UN climate change conference in Germany, said that the US “wants to help all coal-dependent economies to burn coal efficiently and cleanly.”
“There are 1,600 new coal plants being built around the world, and demand for coal and gas is growing. It’s in the global interest that, if these fuels are going to be used anyway, it must be done as cleanly as possible,” Banks said.
For such a trade to happen, however, Business World columnist Bienvenido Oplas said that U.S. anti-coal policies in the Clean Power Plan (CPP) and CO2 Endangerment Findings should first be reversed. Only then can the US establish coal export facilities, and finally, “Asia will have more options of cheaper and higher-quality coal, aside from what they currently get from Australia, Russia, Indonesia, South Africa, and others.”
According to Oplas, The Philippines is a small player in the global coal market. It also has small reserves, negligible production, and meager consumption.
“Yet many environmentalists seek to further restrict, if not actually prohibit Philippine coal power plants and force us to depend on undependable, unstable, unreliable, erratic, intermittent, and expensive wind-solar energy,” he said.
He said that the government shouldn’t pick through legislation, multiple regulations, taxation, and selected subsidies. “They should allow consumers to realize higher consumer surplus via competition and more choices in energy sources that are cheaper, stable, predictable, and dispatchable”.
In 2017, the Luzon grid experienced multiple yellow alerts and a couple of red alerts because of the insufficient power supply. With the US’ plan to venture into energy trading in Asia, a solution to the Philippines’ growing power demands might be on the horizon.