Southeast Asia is rising. Across its cities, from Bangkok to Manila, construction cranes fill the skyline, highways stretch further into the countryside, and factories hum with production. This is a region on the move, driven by economic expansion, rapid urbanization, and a growing middle class. But behind the progress is a fundamental truth—none of it happens without power.
Energy fuels growth, and in Southeast Asia, demand is surging. According to ASEAN Center for Energy, the region’s electricity demands have grown 60 percent over the past 15 years and are forecasted to grow by another two-thirds by 2040. With industry and services expanding, transportation networks widening, and millions of households relying on power for daily life, the question isn’t just about generating electricity—it’s about ensuring it is reliable, affordable, and sufficient to meet the ambitions of a growing economy.
The challenge is even more pronounced in the Philippines, where nearly 80% of energy needs are still met by fossil fuels. The country’s economy has grown by an average of 6% annually over the past decade, and cities like Cebu, Davao, Cagayan de Oro, and Zamboanga are emerging as major business hubs outside of Mega Manila. Every new shopping mall, factory, and condominium signals progress, but it also requires more electricity. In fact, research from the Congressional Policy and Budget Research Department shows that a one-billion peso decrease in electricity demand results in a 3.5-billion peso drop in economic output. Energy isn’t just a necessity—it’s a catalyst for prosperity.
But for many Filipinos, energy remains a fragile lifeline. Middle-income families walk a tightrope—not wealthy enough to be unaffected by rising costs but not poor enough to receive full government aid. A father who drives a tricycle to send his children to school, a small business owner struggling with fluctuating electricity bills, or a call center agent relying on stable power for night shifts—these are the faces of an economy that cannot afford instability. A carbon tax, for example, which aims to reduce fossil fuel use, could raise electricity prices and transportation costs, making daily life more expensive and limiting opportunities for millions.
The numbers make this clear. The transportation sector alone generated over 31.5 million tons of CO2 in 2021, and a carbon tax would significantly impact fuel prices. Data from DOE also cites that 90% of the Philippines’ greenhouse gas emissions come from electricity and transportation. Thus, any policy that increases costs in these sectors risks reducing household consumption, slowing business investments, and dampening overall economic growth.
For industries, higher energy prices mean higher production costs. When firms are forced to invest in alternative energy sources or pay additional environmental compliance costs, they may hold back on expansion, hiring fewer workers or delaying wage increases. The result? Slower job creation and fewer opportunities for Filipinos trying to build better lives. If energy demand shrinks, economic activity contracts, setting back hard-earned gains.
Energy transitions must be well-planned, balancing economic realities with sustainability goals. The Philippines’ total carbon dioxide emissions are already far smaller than neighboring Malaysia and Indonesia, underscoring the country’s existing energy challenges. A sudden pivot away from fossil fuels would require massive investments, restructuring the power grid, and decades of sustained effort—steps that cannot be rushed without consequences for millions of Filipinos.
The path forward must be pragmatic. Investing in cleaner technologies while ensuring energy security and affordability is critical. Policymakers, climate extremists, and the masses must consider the economic trade-offs of hasty and aggressive decarbonization efforts, ensuring that the country’s progress is not hindered by policies that disproportionately impact middle-class and working-class Filipinos. Energy poverty is still a reality for many, and a future with less reliable, more expensive power is not an option.
In the end, power is more than electricity—it is the foundation of progress. As Southeast Asia grows, the Philippines must make energy choices that will uplift its people, sustain its economy, and secure a future where no one is left behind. The challenge is complex, but the goal is clear: power the nation, power the people, and power the future.
Sources:
- https://cpbrd.congress.gov.ph/images/PDF%20Attachments/CPBRD%20Policy%20Brief/PB2023-07_Smoke_and_Mirrors_The_Hidden_Costs_of_Carbon_Taxation_final.pdf
- https://aseanenergy.org/news-clipping/aseans-insatiable-demand-for-energy/#:~:text=Southeast%20Asia’s%20energy%20demands%20have,needed%20to%20power%20the%20economy.
- https://psa.gov.ph/content/gdp-expands-63-percent-second-quarter-2024
- https://doe.gov.ph/key-energy-statistics-dashboards/ghg-emissions
- https://www.iea.org/regions/asia-pacific/emissions
