The Philippines' Department of Energy (DOE) is drafting a policy to compel developers that are exempt from the coal moratorium to build stalled coal plants, aiming to unlock up to 5 GW of delayed generation capacity as aging facilities suffer frequent outages, local media reported on August 30.

Energy Undersecretary Rowena Guevara said the directive targets projects that received exemptions from the 2020 moratorium on new coal-fired power but have not broken ground. The DOE aims to impose strict work plans and binding execution schedules, forcing firms to proceed with construction or abandon their projects to free up space for alternative capacity.

Guevara said renewable energy contracts include clear milestones and automatic termination clauses, but fossil fuel developments have operated without similar enforcement. "You can see our existing coal plants break down, some are derated, they won't be able to produce 100%," she noted.

The country faces urgent supply buffer challenges as aging coal stations suffer unscheduled outages, squeezing reserve margins on the main Luzon grid. The DOE originally planned to issue the guidelines in June but postponed the rollout for further industry consultations.

The policy will not lift or weaken the coal ban, Guevara said, but will tighten oversight of pre-approved legacy assets considered critical for near-term grid reliability. "We have to fulfil our Nationally Determined Contributions, we have to fulfil our renewable energy targets. At the end of the day, we cannot have sudden brownouts," she said.

Philippine power producers face growing pressure to deliver promised infrastructure as industrial demand outpaces baseload deployment, threatening the economic outlook. The country relies heavily on coal for power generation, with Indonesia supplying most of its imported fuel.