APEIA, PE2: ESCO and EaaS models work for industrial WTE, biomass power projects in PH
TAGUIG CITY, Philippines, September 16, 2026 — Asia-Pacific ESCO Industry Alliance (APEIA) Chair and Philippine Energy Efficiency Alliance (PE2) President Alexander Ablaza told waste-to-energy (WTE) and biomass power market stakeholders earlier today that innovative capital investment models for industrial WTE and biomass power projects, such as energy service company (ESCO) performance contracts and energy-as-a-service (EaaS) agreements, now exist in the Philippines as alternative means of raising project capital for projects implemented behind-the-meter of industrial establishments. The APEIA and PE2 views were delivered during the back-to-back 10th Waste Management and Waste-to-Energy Summit 2026 and the 10th Biogas Biomass & Bioenergy Asia Summit 2026: The Philippines Focus, both organized by INBC Global as part of the 10th ASEAN Energy Transition and Decarbonization Summit 2026.
Ablaza highlighted the growing importance of energy efficiency as a strategic energy resource. Citing global energy-efficiency developments, Ablaza noted that energy intensity reduction improved by 1.8% in 2025, but emphasized the challenge of accelerating progress toward the global target of 4% annual efficiency improvement by 2030.
For the Philippines, Ablaza pointed to the significant energy-saving potential within the industrial sector, which accounts for approximately 40% of national energy demand. He presented PE2's estimate that PHP 3.66 trillion in capital will need to be mobilized through 2040 to eliminate 32.4 million tons of oil equivalent (Mtoe) of wasted energy in Philippine industries.
A key focus of the presentation was the need to expand financing modalities beyond conventional approaches. Ablaza outlined a range of on-balance-sheet and off-balance-sheet financing models, including self-financing, energy-efficiency loans and leasing, ESCO performance contracting, public-private partnerships, build-operate-transfer and joint-venture arrangements, portfolio investments, utility-led demand-side management programs, government programs, guarantees, and dedicated energy-efficiency and ESCO funds.
Ablaza also highlighted the role of ESCOs in enabling energy-efficiency investments. Under the global ESCO definition cited in his presentation, ESCOs deliver energy services and efficiency improvements while accepting a degree of financial risk linked to project performance, with remuneration based wholly or partly on measured and verified energy-efficiency improvements. He likewise presented the EaaS approach in which industrial facilities can convert on-site process and biomass waste into clean power, cooling, or heating without upfront capital investment. The presentation illustrated different financing structures, including guaranteed-savings and shared-savings models, as well as third-party investment structures in which an investor or project company provides capital through an ESCO. The presentation stressed the emerging role of private investment vehicles in aggregating ESCO project assets and mobilizing equity and debt for energy-management projects in the Philippine commercial and industrial market.
To demonstrate the commercial viability of behind-the-meter investments, Ablaza featured a 6-megawatt ESCO-implemented biomass power project in Ireland for a large industrial equine bedding manufacturer. The project uses waste wood chips from its industrial process as fuel, with a reported capital cost of €2.5 million and estimated annual output of 49,932 megawatt-hours.
APEIA and PE2’s participation in this annual conference underscores their continuing advocacy for innovative financing, ESCO development, and energy efficiency as practical pathways for mobilizing private capital and accelerating the Philippines' energy transition.
By connecting energy efficiency with waste-to-energy, biomass utilization, and alternative investment structures, PE2 is advancing a broader approach to industrial decarbonization—one that seeks to turn energy savings and locally available waste resources into investable opportunities.
