MANILA (Reuters), The Philippines can install 21 gigawatts of off-shore wind power by 2040. That would be equivalent to roughly a fifth of their electricity supply, according to a Wednesday study by the Department of Energy of the World Bank.

Government data shows that more wind power can help reduce dependence on fossil fuels. This was 79% in 2020.

The 2020 energy mix saw renewable energy make up 21%, a decrease of 34% from 2008. In 2008, it was at 34%. Solar, wind, biomass and biomass together made up a mere 4%.

Nearly 60% of 2020’s mix was made up by coal because many energy producers chose to use the fuel for their projects.

According to the government, renewable energy will be increased to 35% by 2030 and then to 50% by 2040.

This comes after the Philippines pledged to reduce its greenhouse gas emissions by 75% in the 2030s under the Paris Agreement on Climate Change.

“The Philippines’ waters have conditions that are well-suited to offshore wind,” said Ndiamé Diop, World Bank country director for Brunei, Malaysia, the Philippines and Thailand.

However, there are many obstacles to establishing an industry of wind power in the Philippines on a large-scale, including cost, transmission and financing issues. Officials at World Bank acknowledged these challenges.

Offshore wind energy is generally more costly than other types of renewable power. They stated that transmission grid upgrades will be necessary to link large-scale projects. This is to lower costs. However, there are additional risks in gaining investment and foreign ownership being limited to 40 percent.