RE law delay barred PHL from tapping clean-energy fund

Business Mirror
02 Jun 2014 Written by Cai U. Ordinario

The Asian Development Bank (ADB) has disclosed that delay in the implementation of the Philippines’s Renewable Energy Act 2008 prevented the Philippines from tapping the bank’s Clean Technology Fund (CTF) for solar power-related projects.

In a report ADB and the Climate Investment Funds: Climate Change Innovation and Action in Asia and the Pacific, the Manila-based multilateral development bank said this has led the country to only tap the CTF for the e-trike project.

Under the initial plan, ADB said, the Philippine government intended to tap the CTF to finance solar-power projects.

“Slow implementation of the Renewable Energy Act 2008 constrained the investment environment for solar energy,” the ADB said. “Given the increasingly volatile oil prices and positive in-country developments in electronic-vehicle technology, the government therefore suggested a shift in CTF funding to include a major electronic-vehicle project and a more strategic approach to solar development.”

The CTF and the Strategic Climate Fund (SCF) comprise the ADB’s Climate Investment Funds (CIFs). The CTF is worth $5.5 billion and SCF is around $2.5 billion.

The ADB explained that the CTF finances the scaled-up demonstration, deployment and transfer of low-carbon technologies, while the SCF finances the pilot-testing of adaptation and mitigation approaches with the potential for scale-up.

The Philippines was only able to tap into the CTF for the Energy-Efficient Electric vehicles in the Philippines project or simply, the e-trike project which has a total cost of $504 million.

Around $105 million of this amount will be obtained from the CTF and another $300 million will be obtained from the ADB. The remaining $99 million will be coughed up by the national government.

The project will pioneer 100,000 e-trikes as a first step in the electrification of the public vehicle fleet. It will also initiate the creation of a lithium-ion battery supply chain by procuring at least 300 MWh of lithium-ion batteries.

“The project is pioneering the adoption of new battery and charging technologies. Lithium-ion battery technology is clean and proven, fits the purpose, and, through widespread use, is expected to drive up local safety and environmental standards for battery handling and disposal,” the ADB said.

Since the inception of the CIF, ADB has participated in the preparation of 16 investment plans in 14 countries. Under these plans, ADB is administering $1.6 billion in funding for 37 projects across the region.

CIF funding is centered on investment, and the funds provide a unique opportunity to blend resources from the CIFs, MDBs, the government and the private sector to address climate- change mitigation and adaptation in developing countries. So far, 14 donor countries have pledged $8 billion for programs in 48 countries worldwide. source