MANILA – Fitch Solutions forecasts that the country’s power consumption between 2020 and 2029 will average at 4.6 percent despite the near-term headwinds due to coronavirus disease 2019 (Covid-19) pandemic.
In a commentary released Tuesday, Fitch Solutions said it expects power demand in the country to continue increasing with the macroeconomic and demographic growth in the coming years, as well as the government’s 100-percent electrification rate by 2022.
Fitch Solutions said nuclear power will offer an effective solution to the country’s rising power demand and it sees an upside risk to the Philippines’ nuclear sector as it recently gained traction when President Rodrigo Duterte issued an executive order to study the feasibility of nuclear energy in the country’s power mix.
“Increasing traction on plans to develop nuclear power in the Philippines will pose an upside risk to our bearish forecasts,” the report said.
However, Fitch Solutions expects no nuclear capacity to come online in the country over the coming decade due to high capital costs and safety risks.
It said delays could be between 10 to 15 years.
According to the Rosatom State Atomic Energy Corporation that reported visiting the Bataan Nuclear Power Plant (BNPP) in 2017, it requires USD3 billion to USD4 billion to repair and start the operation of the facility.
“It would hence require strong long-term government subsidies to prevent the cost being passed to consumers,” Fitch Solutions said.
It added safety risks will remain a challenge to revive the nuclear sector, as the country is prone to typhoons and natural disasters.
But Fitch Solutions said the reintroduction of nuclear power will be attractive as coal-fired power faces increasing environmental oppositions.
“Should nuclear be successfully introduced in the power mix, coal-fired power will face the highest risk of being displaced,” it added. (PNA)
