More about the Philippines and Energy

It’s no accident that Charles Darwin found so much of interest in the Galapagos Islands. Islands are natural laboratories and experimentation is frequent and vivid in isolated environments.

It’s true for human energy consumption as well. Many islands have to import all their fuel, such as Hawaii. There are a lucky few like the Dutch Antilles, where per capita energy consumption is double that of America–731 mbtus per person per year, mostly because they were fortunate enough to find oil and build an oil refinery on Curacao. There are some, like New Zealand, with low populations on the Ring of Fire that might find a fortunate combination of environmentally friendly fuels to serve their needs. And some, like Madagascar, that will be so constrained by poverty as to leave one perplexed on how they will meet their current, let alone their future energy needs.

The Philippine Islands (there are 7,000 of them comprising a land area a bit larger than Arizona) are home to 101 million people.  It is considered close to a middle income country, with a GDP of $4,000 per person, but in fact many of the metrics found in the CIA’s World Factbook look more like those of a poor country–maternal mortality, infant mortality–all the aspects of poverty found worldwide in the absence of access to energy. (That’s a concept I’ll be turning to over time, not that it’s something I invented.)

One of their primary natural resources is timber. One of the threats to their environment is deforestation. The Philippines imports 310,000 barrels of oil every day. Oil is expensive, the Filipinos are not rich, the wood gets burned. But the Philippines are also lucky enough to have access to geo-thermal power resources, and 15% of their electricity comes from hydropower.

However, islands have it tough in modern times. Although the Philippines are expected to grow in population from 100 to 140 million by 2030, their GDP is not expected to take off like some of the other countries in Asia. Per capita growth is expected to only have a CAGR of 2.6%.

From the outside, it looks as though a major constraint to development in the Philippines is lack of access to energy. Too much of their money goes to oil imports, they are too poor to really build a renewable infrastructure, every penny they spend on energy is a penny not spent improving the health of their citizens. It’s a trap other islands and isolated communities face, and the partial solution that the Philippines is adopting–a diaspora of workers to countries who need the labor–is a stopgap measure at best.

For the purposes of this blog, the important thing is to note what looks very much like a latent demand for energy–cheap energy–that, if available would trigger a massive spike in energy usage as it powered the Philippines to a rapid development that would catch them up to world standards in a hot heartbeat. I wrote yesterday that the Philippines had a per capita energy consumption of 14 mbtus annually, a scandalously low figure. But the people are too intelligent, literate, active and ambitious to be satisfied with that.

Whether that energy is provided by hydro, solar, geothermal, ocean thermal, wind or fossil fuels, they will get the energy they need.