PMCJ on DOE’s Japan METI partnership:The Philippines needs a strategic and aggressive shift to renewables, not another debt-driven fossil fuel deal

Quezon City, Philippines — The Philippine Movement for Climate Justice (PMCJ) raises a red flag to the joint statement of the Department of Energy (DOE) and the Ministry of Economy, Trade and Industry (METI) of Japan to establish a strategic petroleum reserve program in the Philippines and joint stockpiling efforts within ASEAN. 

The US-Israel war in West Asia compounded the problem of an existing energy crisis that has long been waiting to explode. The country’s alarming reliance on imported fossil fuels made it extremely vulnerable to geopolitical conflicts and global supply chain disruptions.

Filipinos are already at the receiving end of fossil fuel dependence. Power outages are cutting across cities and off-grid communities. The increasing costs of input and fuel put more farmers and fisherfolk at risk of losing their livelihoods. The aggressive price increases, as the inflation rate has gone up to 7.2%, are shrinking household budgets already bleeding from electricity bill shocks and a measly wage increase. All of these, combined, are among the results of a heavily privatized oil and power industry and a government that fails to provide relief and recovery for Filipinos already in survival mode.

The cooperation between the Philippines and Japan will operate under the framework of Partnership on Wide Energy and Resources Resilience (POWERR) Asia. For the Philippines, the development of new stockpiling facilities would be done as part of establishing a strategic petroleum reserve. Japan will provide feasibility studies, capacity building, and participation by Japanese government institutions and private companies in the construction and financing of relevant projects. Such a national stockpiling system in the Philippines will drain public funds. 

The Philippine Institute of Petroleum (PIP) estimated that a 90-day reserve for the Philippines would cost PhP 176 billion for the crude oil alone. On top of this, the construction and maintenance of a strategic petroleum reserve infrastructure will be more expensive. The POWERR Asia framework would provide over $10 billion in financial support to countries in Asia to assist with projects addressing fuel supply shortages and supply chain disruptions. But mobilizing that support involves loans from the Japan Bank for International Cooperation (JBIC) and the Japan International Cooperation Agency (JICA), export credit insurance, and multilateral co-financing from the Asian Development Bank (ADB). This means that joint cooperation between Japan and the Philippines would result in deeper outstanding debt in the country, already at PhP 18.49 trillion as of the end of March 2026. Even more striking, it will conflict with countries' efforts to diversify their energy sources, as POWERR Asia will expand into liquefied natural gas, nuclear power, and critical minerals.

This agreement is a fossil fuel entrenchment deal dressed up as an energy security measure.  At a time when oil, gas, and coal are at historic highs while the country is among the world’s most vulnerable nations, a strategic petroleum reserve is not the answer. It is a trap. Filipinos would end up paying for the resources needed to build the petroleum storage infrastructure while locking the country into the same long-term fossil fuel investment. It reveals the hidden cost of systemic dependence on fossil fuels, in which a country is structurally wired to rely on solving an energy crisis with more of the same dependency that created it. 

PMCJ reiterates that the only path forward is to break this cycle of dependence and achieve a just energy transition. It calls for rejecting this fossil-fuel lock-in deal and instead focusing on a strategic, aggressive shift towards 100% renewable energy (RE). International cooperation must not come at the expense of destroying the people and the future. It must be anchored in genuine climate justice and demonstrate the urgent need to phase out fossil fuels.

Grants-based, unconditional, and scaled financing support must be redirected toward what the Philippines actually needs: a rapid, just, and equitable shift to RE that reduces import dependence, stabilizes energy costs, and puts power back in the hands of the Filipino people. ###

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FOR INQUIRIES:

Elle Bartolome

Senior Executive Officer on Policy, Campaigns, & Communications

Philippine Movement for Climate Justice

seo@climatejustice.ph