Philippines to save P10 B yearly on shift to renewable energy

Philippines to save P10 B yearly on shift to renewable energy

The Philippines stands to save over P10 billion a year if it replaces diesel
generation in off-grid areas with renewables, the Institute for Energy
Economics and Financial Analysis (IEEFA) and Institute for Climate and
Sustainable Cities (ICSC) said.

A report done by IEEFA titled "Electricity-Sector Opportunities in the
Philippines: The Case for Wind- and Solar-Powered Small Island Grids-" calls
for prudent reforms that will require electric cooperatives and private
distribution utilities alike to optimize procurement, to help level the
playing field for renewable power generators and reduce taxpayer costs by
phasing out subsidies for imported diesel fuel.

"Small islands in the Philippines are placed perfectly to benefit from
dramatically reduced costs of renewable energy. Simple reforms can pave the
way for cleaner, cheaper and more reliable energy for more than 800,000 of
the poorest Filipinos," IEEFA analyst Sara Jane Ahmed said.

Under the current system, there are no incentives for electric cooperatives
to procure cheaper sources and reduce costs.

"The Department of Energy should direct the National Power Corp.'s Small
Power Utilities Group to speed up the hybridization of its plants and
install as much renewable energy-powered plants in new sites identified for
electrification," Ahmed said.

"Moreover, the National Electrification Administration should direct
electric cooperatives to be technology-neutral in the procurement of power,"
she added.

According to the report, investment opportunities in small island renewables
are worth at least $1 billion to private developers in the country.

At present, the country's small islands are served by mini-grids powered by
generators fueled by imported diesel and bunker oil. As a result of grid
instability, inadequate generation capacity and lack of subsidized fuel,
these islands suffer from blackouts and unplanned power outages.

Power for the islands costs over P60 billion in subsidies despite only
accounting for six percent of total energy demand and 0.49 percent of total
generation, based on the report.

Moreover, not all islands have 24/7 electricity service even with expensive
subsidies. Only 22 of 233 areas in question have 24/7 electricity, with over
70 percent having less than eight hours per day of electricity.

"Currently, Philippine taxpayers are footing a huge bill by subsidizing
expensive imported diesel to provide dirty and unreliable power for the
small islands," Ahmed said.

With solar-powered electricity costs falling by 99 percent since 1976 and 90
percent since 2009, and with the cost of wind-powered generation declining
by 50 percent since 2009, the economics of renewable energy make it
particularly suitable for small islands, which are unable to link to
mainland electricity grids, the ICSC said.

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Link to Original Article:
http://www.philstar.com/business/2017/05/15/1699990/philippines-save-p10-b-y
early-shift-renewable-energy

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com