The recent conflict in the Persian Gulf has prompted renewed interest in green energy development, as countries seek to reduce their reliance on volatile fossil fuel supplies. Following a U.S. and Israeli attack on Iran, energy officials in the Philippines reached out to infrastructure investor Actis, which is overseeing one of the nation’s largest renewable energy projects, a solar-and-battery farm north of Manila. The project, known as MTerra Solar, is designed to power approximately 2.4 million households and span nearly 14 square miles. With just 10% currently operational, the Philippine government has expedited approvals for additional green energy facilities amid concerns over fuel shortages caused by disruptions in the Strait of Hormuz, a critical shipping route for Asian oil imports.

According to Actis executive Rahul Agrawal, permits for grid connections that normally take months were granted within days, underscoring a shift toward faster deployment of renewable projects in response to the energy disruption. Although the current cease-fire may stabilize energy markets temporarily, the crisis has already accelerated efforts by governments worldwide, including the United Kingdom and South Korea, to increase clean energy capacity. These long-term initiatives often coexist with short-term emergency responses such as expanded coal use and fuel rationing.

Historical energy crises have sometimes stimulated changes in energy policy, as seen with the nuclear power surge following the 1970s Middle East oil embargo. However, more recent shocks have yielded mixed impacts; for instance, Europe’s 2022 energy crisis did not significantly alter wind and solar growth trajectories despite numerous policy statements. Yet for countries like the Philippines, where imported liquefied natural gas (LNG) prices have surged and supplies have become uncertain, the economic case for renewables is strengthening. The falling costs of Chinese-manufactured solar panels and battery storage systems have improved the viability of clean energy projects, easing some of the complexities involved in reducing industrial emissions.

Before LNG prices escalated in March, the MTerra Solar facility was already expected to provide about 13 hours of daily electricity at costs slightly below those of LNG-generated power—an outcome considered unlikely just a few years ago. Agrawal noted that as recently as 2022, combined solar-and-battery energy was more expensive than LNG-based power, but rapid declines in battery costs over the past three years have significantly shifted this calculation. As geopolitical tensions continue to disrupt fossil fuel markets, the drive toward renewable energy appears to be gaining unprecedented momentum.