Untapped Vast Potential of Micro Hydro and Solar Energy

The development of renewable energy in the Philippines is not just a means to mitigate the impact of climate change but can also help solve the pressing problem of energy security. The Government has an energy plan and is encouraging foreign investment. Global Green has three biomass power projects in the Philippines, with an aggregate capacity of 70 megawatts and expected to be on-line by 2012.

From Manila, Philippines by Philstar.com (6 April 2010):

The development of renewable energy in the Philippines is not just a means to mitigate the impact of climate change but can also help solve the pressing problem of energy security.

This is especially crucial now as the El Nino is causing widespread blackouts in Mindanao. The drought spell, which is expected to last until June, reduced water levels, cutting supply in southern Philippines, where more than half of its energy requirement is sourced from hydropower dams.

Philippine Assistant Energy Secretary Mario Marasigan noted in a recent forum that one of the key programs of the twenty-year Philippine Energy Plan (PEP) is to “aggressively develop renewable energy potential such as biomass, solar, wind and ocean resources.”

Under the PEP, the Philippine government is targeting to double the current 5,300 megawatts renewable energy-based installed capacity for power generation by 2030. This is in line with the government’s thrust to ensure energy security while at the same time help in reducing carbon emissions.

The use of the so-called “green power” is at the core of the global climate change debate, as rising greenhouse gas emission is mainly caused by the growing consumption of coal and oil for energy needs.

The Philippines depends on imported oil and coal for most of its energy needs. But the abundance of potential renewable energy resources will help limit such dependence.

Marasigan noted that apart from the “untapped vast potential” of micro hydro and solar energy, the Philippines can further harness its wind, solar and ocean energy potential.

The Philippines in fact has the only wind farm in the Southeast Asian region. The windmills in the northern Philippine province of Ilocos Norte was built via a $40 million loan from the Danish

Development Agency. Wind power supplies about 40 percent of Ilocos Norte’s electricity requirements.

“The Philippines has abundant indigenous sources of renewable energy. Not to utilize this is a crime,” says David De Montaigne, president of British project development firm Global Green Power Corp.

Global Green has three biomass power projects in the Philippines, with an aggregate capacity of 70 megawatts and expected to be on-line by 2012, at the earliest. The company will sink in about $192 million to build plants in the provinces of Nueva Ecija, Iloilo and Bukidnon.

Global Green is one of the foreign investors that the Philippines managed to attract following the passage of the Renewable Energy Act of 2008. The law provides fiscal and non fiscal incentives to investors in renewable energy.

Marasigan said that since the passage of the said bill, the government has awarded 159 new project development contracts. About 61 contracts are pending for review and eventual awarding to project proponents. Combining the awarded and pending contracts can provide an estimated renewable energy capacity of 6,274.37 MW.

By 2030, Marasigan said that the energy department is projecting an additional renewable energy capacity of 10,835 MW. The bulk of which will come from hydro with additional 6,767 MW capacity and geothermal, with 6,767 MW.

Despite the presence of several project proposals and the fact that the government grants attractive incentives for renewable energy investments, Marasigan said that several challenges remain.

For one, “the perceived investment risks are still an issue.” The available technical expertise is still in question given the limited number of engineers and technical consultants. And in some areas, the energy plants, even those that generate green power, are not socially acceptable.

But the biggest challenge that faces those who advocate for renewable energy is its marketability. Coal is perceived to be cheaper than renewable energy sources. So the question remains: would consumers pay more to consume clean energy?

For Ernesto Tan, senior vice president and chief finance officer of pioneering biomass power project developer Asea One Power Corp, the answer is yes.

“The initial investment in renewable energy is usually high. But it’s cheaper to maintain it,” he said.

Asea One is investing about $180 million in the next three years to build biomass power facilities in central Philippine provinces of Aklan, Negros Occidental, Iloilo and Cebu. The projects will generate an additional 72 MW capacity in the Cebu-Negros-Panay grid.

Source: www.philstar.com