The real drivers behind coal's decline in the Philippines are expansion of renewable energy and outage of fossil fuel plants according to a new analytical commentary released by the Institute for Energy Economics and Financial Analysis (IEEFA).
The new commentary Clean Energy is Driving Coal’s Decline in the Philippines, Not LNG authored by IEEFA LNG/Gas research lead Sam Reynolds suggests that renewable energy, particularly solar and hydro — not liquefied natural gas (LNG) — are leading the shift, while outages at aging coal plants and cost dynamics further undermine the LNG storyline.
Recent media reports in the Philippines have credited LNG with the country’s first significant drop in coal generation in decades. However, IEEFA’s new analysis shows that LNG has played a limited role in displacing coal and that the real drivers behind coal’s decline are renewable expansion and fossil fuel plant outages.
According to IEEFA, data from the department of energy (DOE) shows that no new greenfield LNG or gas-fired power capacity was commissioned between 2017 and 2024. The last recorded increase in gas capacity occurred in 2022 and was limited to uprating existing facilities, not through the addition of new LNG infrastructure.
The new analysis also reveals that coal-fired power generation in the Philippines fell in the first half of 2025, putting the country on track for its first annual decline in coal generation in decades. In the first half of 2025, the Philippines also saw greater increases in generation and capacity from renewables than from LNG. Moreover, eight coal plants in the Philippines faced extended outages in the first quarter of 2025, which provides a better explanation for the drop in coal than the rise of LNG.