Renewable energy attractiveness: How we fared?
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Photo source: www.greenpeace.org
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The Philippines is among the
newest entrants in EY’s latest Renewable Energy Attractiveness Index, placing
35th out of 40 countries being monitored for macro, energy market, and
technology-specific drivers. Each parameter is measured using indicators which
include economic and political stability, ease of doing business,
prioritization of renewables, availability of finance, strength of natural
resource and technological maturity. The overall ranking puts the Philippines
ahead of neighboring Indonesia (39th) and even RE heavyweight Finland (36th).
The Philippines was among
those cited in the EY report due to three factors, namely: its “ambitious
renewables targets, stable incentive regime, and high energy demand driven by a
large and growing population.”
For its targets, the
Philippines has set a goal of 15,304 megawatts (MW) of RE capacity by 2030
based on the 2011-2030 Philippine Energy Plan. This is almost triple the
5,438-MW capacity measured in 2010. As of 2012, RE accounted for 32% of the
total installed generating capacity, while coal cornered the largest share at
33%.
This is reflected in the
Philippines’ sub-rankings in the EY index. The Philippines placed highly in
terms of the “technology-specific” performance of geothermal (8th out of 40
countries), marine (8th), hydro (21st), and solar (22nd) resources. These
rankings are based on indicators which take into consideration the abundance of
the natural resource, attractiveness of power offtake, quality of technology,
forecast growth and pipeline, among others.
The geothermal capacity of
the Philippines is said to be the second largest in the world, next only to the
United States. The Philippines has also been reported to place 5th in the world
in terms of annual investment in geothermal power capacity in 2013 according to
REN21, a global RE policy multi-stakeholder network.
Meanwhile, in terms of the
country’s incentives regime and government support, the government includes RE
in the Philippine Energy Plan. Furthermore, incentives abound for RE investors
as provided by the Renewable Energy Act of 2008 (Republic Act 9513).
As the country’s population
and economy grow, an increase in demand for energy follows. It has been
reported that consumers could expect another round of rotating brownouts in
2015 due to low reserves, and expectations that upcoming power plants will not
start operations on time. According to International Energy Consultants, the
energy rate per kWh in the Philippines is currently one of the highest in the
world. In 2012, the Philippines ranked the highest in South East Asia and 2nd
only to Japan in Asia. This could be partly remedied by RE projects. The World
Wide Fund for Nature (WWF) reportedly claims that geothermal energy is the most
economical if all costs were truly considered. Among the eight sources cited,
hydro, which is among the country’s main sources of energy, is ranked 5th
cheapest.
It is hoped that the mention
of these three factors for the Philippines in the EY index will energize and
boost RE investment in the country. The index is a good indicator of the
positive outlook for the local RE sector. Nevertheless, more action is still
needed to fulfill the country’s RE potential. Failing to rise to the challenge
of energy development and the inability to optimize the country’s RE resources
would have dire consequences for our people and economy. The public and private
sectors must unite to unleash the sector’s true capacity in any or all the
areas of biomass, geothermal, hydro, marine, solar, or wind, since the
Philippines is blessed to have them all. (Source: www.bworldonline.com)
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