<p>Once an exception in the story of miraculous economic growth in East Asia, the Philippines is still an outlier in terms of its export volume and manufacturing production despite the impressive economic growth in the twenty-first century. Some may attribute the exceptional situation to the weak state with crony capitalism, while others may highlight the missing opportunity after the Plaza Accord of 1985, prompting Japanese firms to invest in neighboring Southeast Asian economies. Against this backdrop, we argue that the energy policy reform, entangled with the previous policy choices and regional contingencies, prevented investors from boosting the Philippine economy. To advance the argument, we scrutinize the policymaking and implementation amid the governance crises (i.e., corruption), energy shortage, and the government-wide fiscal crisis caused by the Asian Financial Crisis. The process-tracing reveals a series of crises prompting the policymakers to prioritize punishing the corruption-prone institutions, increasing supply, and reducing the government’s financial burden over electricity price reduction, resulting in prohibitively high electricity prices. Thanks to privatization, private businesses in the energy sector have thrived, but are not free from regional contingency. Private sector-led resource exploration in the South China Sea, which had once found a rich energy source, faced another regional contingency created by China’s assertive actions at sea. The story of the entangled energy policy reform sheds light on the roles of the institutional arrangements and regional contingencies, which are often neglected in the dominant discourse in the Philippine political economy.</p>