by Myrna Velasco January
4, 2016
A country’s economic
success is, of course, a cause for celebration. Yet it brings some challenges
especially to a sector that provides it the backbone for growth – energy.
The lack of it can
curtail economic activities and would cause extreme inconvenience to people
(read: brownouts); while technology preference may set significant contribution
to virulent greenhouse gas (GHG) emissions that are known in science to be
potent triggers to planet’s warming.
For the Philippines,
the battle line had been drawn: ironically, it is between life (or the need for
survival) and the force of nature.
The year 2015 put the energy sector in sharp
focus – not only domestically but on international affairs. The major events
that had energy in the center of discussions include the: Asia Pacific Economic
Cooperation’s 12th Energy Ministers Meeting (APEC-EMM) in the Philippines; and
the 21st Conference of the Parties (COP 21) of the United Nations Framework
Convention on Climate Change in Paris, France.
It is a known fact
that energy development in the Philippines has been taking a reverse track if
compared to what other countries have been pursuing – that instead of
aggressively advancing to ‘clean energy sources’, its capacity ramping up in
the immediate- to medium-term are generally coming from coal plants.
Alright, some may
argue that renewable energy (RE) installations – with the support of
feed-in-tariffs (FITs) — are also being pursued vigorously and that the country
already had high share of RE on its power mix prior to the entry of the new
coal capacities.
Project developers
reckon that ‘coal’ is the only technology desirable to address its need for
base load capacity – if referenced on the current ‘spending power’ of the
Filipino consumers. They further note that for an emerging economy, it is vital
that it leans on a technology that will be affordable to sustain its expansion.
Up to that point, it
is understandable. But the nagging question rests on the future: how committed
the country is into re-balancing its energy portfolio to a low carbon future
following this new era of ‘king coal’s dominance’?
Energy Secretary
Zenaida Y. Monsada, in several forums, has stated that any fuel mix policy to
be enforced shall be on a ‘voluntary basis’. It entails then that it now lies
upon the conscience of the private investors if they will do something to help
preserve the environment for their children and the children of their children.
As experts have
warned: with the whole world now racing against time in reversing climate
warming that may go beyond the 2.0 degrees Celsius pre-industrial levels
target, governments and markets could no longer afford to slacken on the
‘energy transformation’ pathway.
‘Persuasive call’ in
Paris
In his speech at the
recently concluded COP21, United Kingdom’s Prince Charles has hit the nail on
the head when he said that: “in damaging our climate, we become the architects
of our own destruction … I pray that in pursuing national interest, you will
not lose sight of the international necessity.”
He further stressed
“while the planet can survive the scorching of the earth and the rising of the
waters, the human race cannot…to avoid catastrophe, we must restrict climate
change to less than 2.0 degrees, which requires a dramatic reduction in carbon
emissions.”
In essence, the Paris
climate change diplomacy negotiations set a strong tone on the need for
countries to shift into ‘cleaner energy systems’ and be more cognizant of
energy efficiency initiatives and ventures. To many, clean energy is generally
equated to RE and technology-linked advancements such as battery storage – plus
the other lower or zero carbon-emitting technologies such as nuclear and
gas. In the discussions, it had been the coal facilities thrown in ‘a
very bad light’ as they are known to have the highest carbon dioxide (CO2)
emissions triggering climate change risks.
Moving past the
so-called ‘dirty phase of development’ had been the resounding call on
government leaders and the investing community – and so far, 186 countries
lodged their Intended Nationally-Determined Contributions (INDCs) to reducing
their respective carbon footprints.
The good news had
been: the world’s biggest CO2 emitters – primarily China and the United
States – joined the bandwagon. Plus, the developed nations have doubled funding
commitments that must be channeled to their ‘least developed’ and developing
counterparts to aid them on mitigation and adaptation – and with the intent
also to build their capacity on technology transfer.
As emphasized, what
will eventually entice technology transfer is the marketplace — it’s the price
coming down and for it to come into the markets of the developing world. In
time, consumers will be paying for these technologies without the
feed-in-tariffs and subsidies.
US President Barack
Obama somehow set the record straight when he averred that “as the leader of
the world’s largest economy and the second largest emitter…the United States of
America not only recognizes our role in creating this problem, we embrace our
responsibility to do something about it.”
He stressed that the
role of governments would be to “show businesses and investors that the global
economy is on a firm path towards low-carbon future,” noting further that “if
we put the right rules and incentives in place, we’ll unleash the creative
power of our best scientists and engineers and entrepreneurs to deploy clean
energy technologies and the new jobs and new opportunities that they create all
around the world.”
The aim of the Paris
accord, Mr. Obama said is “not simply an agreement to roll back the
pollution we put into our skies, but an agreement that helps us lift people
from poverty without condemning the next generation to a planet that’s beyond
its capacity to repair.” The US trumpeted its achievements on carbon emissions
reduction, mainly leaning on its massive rollout of RE projects; and the
retrofitting as well as retirement of coal plants that have been replaced by
gas facilities. But Mr. Obama has admitted they need to do much, much more to
achieve their set targets.
Other countries –
such as India and Africa – have also scaled up deployment of RE to electrify
their remote villages – with them noting that rollout can be accelerated with
anticipated further drop in the cost of solar photovoltaics (PVs) and wind
turbines in the coming years. This is also seen an ideal solution to the
off-grid areas in the Philippines. And just as the aspiration of similarly
situated countries, battery energy storage, they said, will be the
transformative phase that could advance these goals.
The power industry is
not the only recognized culprit assaulting the environment. Co-sharing in the
‘evil billing’ is the transport sector. United Nations Environment Programme
Executive Director Achim Steiner has noted that “the transport sector is
responsible for a quarter of all energy-related CO2…and this will grow to a
third by 2050, faster than any other sector.” The UNEP places its bet on
electric mobility – being one of the viable shifts that could help pare the
carbon emissions of the transport sector.
‘Energy resiliency’
in the equation
At the APEC-EMM
meeting in Cebu, resiliency of energy systems and infrastructures had been the
focal point of discussion.
Secretary Monsada who
chaired the sessions had highlighted the ‘brunt of disasters’ on energy
infrastructures and how such can disrupt the entire value chain if both
developments and response-mechanisms are not resilient. “We have seen how
communities are paralyzed during disasters when infrastructures are affected
and damaged,” she said.
On the sphere of
cataclysms, closest and most nightmarish to every Filipino had been
super-typhoon Yolanda’s (international code name: Haiyan) devastation in
November 2013. Past the human drama because of the magnitude of lives and
properties that vanished plus the economic setback this disaster triggered, the
resiliency of the country’s energy infrastructure had also been placed under
stringent scrutiny.
The Energy Ministers
during the APEC meeting have noted that the nuances and dilemmas posed by
natural and man-made disasters on energy facilities and systems must not be
neglected – and that knowledge-sharing as well as technology reinforcements are
necessary to make them resilient to calamities and viable in sustaining the
supply chain.
Yet another dilemma
taking its core in the intensifying debate is the food-water-energy nexus or
the so-called multi-dimensional puzzle of a thirsty triangle.
Michel Jarraud, chair
of UN-Water, has opined that “water and energy are among the world’s
pre-eminent development challenges and must feature prominently in the
post-2015 agenda.” He added “strategic choices made in one domain have
repercussions on the other … droughts make energy shortages, while lack of
electricity reduces farmers’ ability to irrigate their fields. Pricing policies
also highlight the interdependence between water and energy.”
And water, once it
turns into a scarce resource, could become a “destabilizing factor” and may
likely replace oil as the next trigger of global conflicts, as security
specialists had assessed so. Severe water strains are being anticipated in
North Africa, Central and South Asia; while lingering trans-boundary uses of
water, including in many Asian jurisdictions, are already igniting tension
among neighboring countries.
Policy and regulatory
gaps
In the Philippines,
major gaps still exist in policies and regulatory frameworks to support its
ambitions toward cleaner energy future as well as on technological advancements
and innovations – and it will be a tough call of action on the part of the DOE
and ERC.
Energy regulation, as
perceived in particular, had and could always be the source of pain and hope
for consumers. If regulators will do the right thing, it will bear benefits for
the consumers, but if they fail, the repercussions could be perilous — not just
to an industry but to a country in general.
Note that the country
is not alone in these kinds of energy dilemmas, thus, the regulators and
policymakers can draw lessons and references from global peers. Should they
need to be ‘the terrorists at the table” to arm-twist investors on setting
forth clean energy investments? Strategy and rules crafting will be up to them
to decide on. The only stern reminder is that: viable policy planning and
regulatory enforcements by governments must lead the way for future
investments.
Diversification of
energy sources as well as best practices and technology advancements must be
integrated in the policy-crafting menu. Just a reiteration: “any shift must not
be expensive for the individual consumers; and that it shall bear no negative
effects on competitiveness of modern economies.”
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