DoE to review basis for 70% Paris emissions cut pledge

Posted on July 27, 2016
http://www.bworldonline.com/content.php?section=Economy&title=doe-to-review-basis-for-70%-paris-emissions-cut-pledge&id=131027

THE Department of Energy (DoE) is calling for a review on how the previous administration came up with the 70% target reduction in greenhouse gas emissions from a business-as-usual scenario, as talks continue among government agencies to come up with a unified stand on climate change.

Felix William B. Fuentebella, DoE spokesperson, said that the department is looking at the country’s commitment to the United Nations Framework Convention on Climate Change as he described the pledge as “too general.”

“What is business as usual as far as numbers are concerned and what is 70% of that,” he said in a press conference on Tuesday at the agency’s head office in Taguig City. DoE Secretary Alfonso G. Cusi was absent during the briefing.

The country late last year said its planned emissions reduction would come from energy, transport, waste, forestry and industry sectors ahead of the adoption of an agreement to keep the rise in global temperature under two degrees Celsius at the 21st Conference of the Parties (Cop21) in Paris in December 2015.

Mr. Fuentebella said the department was gathering the needed data that it would submit to the Climate Change Commission, the Department of Environment and Natural Resources, and the National Economic and Development Authority.

Along with the DoE, the government agencies agreed by yearend to come up with a sustainable national energy policy that will decide on the future of coal power projects in the country.

Mr. Fuentebella said the DoE’s direction would be based on what President Rodrigo R. Duterte said during his State of the Nation Address on Monday that the country’s energy needs would depend on what is called for by its move towards industrialization.

“We will follow the President,” he said, although adding that the country’s Cop21 pledge would also be considered.

Between now and 2020, about 4,792 megawatts (MW) of new power capacity will come from proposed coal-fired power plants. They account for about 70% of all the new power sources in the next four years, DoE data show.

Of the additional power from coal power plants, 2,762 MW will come from Luzon, 420 MW from the Visayas and 1,610 MW from Mindanao.

Other projects are also awaiting “financial closing” or funding from loans and investments that could move their proposed plants forward. These indicative projects are the ones most likely to be hit should the government come up with a stricter policy on coal-fired power plants, or if indeed these will be replaced by renewables.

In Luzon, nine such projects are in the pipeline with an estimated capacity of 5,600 MW. Visayas has about 900 MW while Mindanao has five projects with 1,400 MW. They still outpace the future capacity coming from renewable energy.

As it stands now, the country has about 16,451 MW of dependable capacity, which looks sufficient to meet an estimated demand of 12,000 MW.

“The president also directed... the concerned regulatory agencies to prioritize the issuance of required permits for power development,” Mr. Fuentebella said, quoting the president. “The heavy machineries could come in and even the power, the cheapest is coal.”

“It’s a matter of talking and explaining to them, you’re using the state-of-the-art technology. I’ve seen it several times in other power plants in this country. If it’s really a good one, then we will consider it. I said because we need energy to power our industrialization,” he quoted Mr. Duterte as saying.

He said Mr. Cusi had instructed DoE bureaus to list the permitting process that power plant developers go through to start their projects.

“He emphasized that the priority is power,” he said, adding the department was looking at each step of the development phase for all types of plants from traditional energy to renewables.

“When we face the inter-agency meeting where there will be an accounting of how many signatures are required from each department, the DoE should have already streamlined the maximum number to hasten the process],” he said.

In the same press conference, Petronilo L. Ilagan, the other DoE spokesperson, said that the department had talks with the country’s biggest distribution utility Manila Electric Co. (Meralco) and electric cooperatives to exercise their corporate social responsibility by making direct connections to relocation sites and depressed areas.

“There is a sense of urgency on the situation where some sectors of the community or the nation are deprived of electricity,” he said.

Mr. Ilagan said it would be up to the Energy Regulatory Commission (ERC) to ensure that the costs incurred by the utilities are not passed on as “recoveries” from consumers.

“We have the confidence that ERC would be applying this as a non-allowable expenses,” he said.

In a statement released after the briefing, the DoE said that between July 8 and 24, Meralco had connected power to a total of 2,082 households via a combined regular service and prepaid electricity service schemes.

During yesterday’s briefing, the DoE spokespersons also gave a timeline for the privatization of the country’s remaining power generation assets that are under the management of Power Sector Assets and Liabilities Management Corp. (PSALM).

The first plant scheduled for auction is the decommissioned 850-MW Sucat thermal power plant in Muntinlupa City, with the bid and award date set in the second half of 2016.

Next year, the DoE is looking at selling the hydroelectric power plants along Agus and Pulangi rivers in Mindanao, but “subject to consultation with Congress as provided under EPIRA [Republic Act No. 9136, or the Electric Power Industry Reform Act of 2001].”

The Malaya thermal plant is scheduled to be bid out in the first semester of 2018, and turned over to the winning bidder in the second half. The Bataan thermal plant as well as gas turbines will be sold “subject to the resolution of court cases.”

Mr. Fuentebella also said that a “technical audit team” at the DoE will look at whether there is a need for a third round of feed-in-tariff rate for renewable energy technologies such as solar and wind power. The audit would include factors such as the areas where more power is needed, the type of plant and the capacity of the grid.