THIS is in response to the column titled “The reliability double standard” written by Mr. Ben Kritz, published on Jan. 27, 2026. While Mr. Kritz raises legitimate concerns about energy security, the piece conflates reliability with baseload capacity and misrepresents how the Philippine power system actually operates. More importantly, it overlooks the structural causes of today’s reliability challenges baseload overcapacity, inflexible contracts and poor risk allocation — while unfairly placing blame on renewable energy.
1. For decades, Philippine power planning assumed electricity demand to be largely constant, justifying heavy investment in baseload generation. In reality, electricity demand varies significantly by hour and season, peaking between 9 a.m. and 9 p.m. Analysis of the 2024 Luzon load profile shows off-peak demand, which is the basis of baseload capacity requirements, ranges from 6,000 to 9,000 megawatts (MW) while dependable baseload capacity exceeds 12,300 MW. This dependable baseload capacity is nearly equal to the system’s peak demand of about 13,700 MW, representing baseload overcapacity. This forces coal plants to ramp up and down daily, operating outside their optimal design parameters, which can result in accelerated wear and tear, degraded performance and increased forced outages, even exceeding the Energy Regulatory Commission allowable outage limit.
2. Coal and other thermal plants face additional pressures from global fuel price volatility and geopolitical risks. Yet inflexible power supply agreements (PSAs) often guarantee payments regardless of actual delivery, while penalties for nonperformance remain weak. This shifts both price and operational risk from generators to consumers. The Calaca coal power plants illustrate this problem. Despite Unit 2 being offline for nearly 10 months each in both 2021 and 2022, company disclosures still showed profitability. This points to a deeper flaw in contract design: PSAs that reward capacity ownership rather than dependable performance. Such arrangements weaken accountability and undermine incentives for reliability.
3. A pro-consumer regulatory regime is paramount to bring about meaningful change in the energy sector. Automatic fuel pass-through for coal should be removed as it allows cost spikes to be passed directly to consumers, weakens incentives for efficiency and discourages prudent fuel risk management. PSAs must also be transparent, enabling the public to see the true cost of power and ensuring that payments reflect performance rather than guaranteed returns.
System reliability does not depend on any individual generator operating continuously for 24 hours. Instead, it depends on the grid’s ability, as a whole, to meet demand at all times despite these sources of variability. Thus, reliability today will not be achieved by adding more inflexible capacity, but by building a system that can respond to variable demand patterns through a balanced mix of baseload, intermediate and peaking resources. This is obviously not the case in the Philippines, where baseload overcapacity leads to unplanned shutdowns and eventual grid alerts, which then result in higher electricity bills and the risk of power supply interruptions despite paying for “reliable” capacity.
Solar and wind plants are paid only for the electricity they actually generate during expected periods. Their variability is predictable, priced and planned into system operations. This is fundamentally different from unplanned outages of large thermal plants, which remove capacity unexpectedly and destabilize the grid.
Critics frequently argue that renewable energy is unreliable because it is intermittent, and that coal plants are therefore indispensable for grid stability. This argument confuses variability with unpredictability. Renewable output varies, but it does so in patterns that are forecastable, scheduled and explicitly accounted for in dispatch and contracts. Coal plant failures, by contrast, are unplanned, abrupt and remove large blocks of capacity without warning — precisely the events that trigger grid alerts. A system built around resources whose behavior is known and planned is inherently more reliable than one that is dependent on large, inflexible units that fail unexpectedly.
Energy security ultimately depends on getting the energy mix right. For an archipelago like the Philippines, reliability comes from flexibility and diversity. Indigenous renewable resources — solar, wind, hydro, geothermal and biomass — combined with energy storage, demand-side management and a modernized grid, provide the ability to meet peak demand and improve system resilience. Renewable energy is not a liability — it is a predictable, strategically essential and resilient component of the Philippine power system.
Angelo Kairos de la Cruz
Executive Director
Institute for Climate and Sustainable Cities