By:
Reman A. Chua - Philippine Daily Inquirer / 05:10 AM July 12, 2018
Our country is at the
cusp of a revolution that is sweeping the world today, with many powerful
vectors converging to transform the energy industry. If we are able to ride the
wave, we have a golden opportunity to build a power industry that is truly for
the 21st century—one that does not only address inclusive economic development
but also adopts exponential technological advances and mitigates climate
change.
Serving as a backdrop
is the undeniable environmental changes we are experiencing. Citing the
National Oceanic and Atmospheric Administration’s (Noaa) monthly global climate
report, CNN reported that for 400 consecutive months or more than 33 years, the
Earth’s temperature had risen to above average.
While natural factors
can account for some of those anomalies, Noaa scientists say the overall
pattern can be attributed to anthropogenic or human factors.
What we need to
understand is that the Philippines is at the center of this issue. Based on the
Global Climate Risk Index, the Philippines is the number one country in the
world most affected by climate-related disasters over the last 20 years. This
is not surprising given that over 50 percent of municipalities and almost all
major cities are coastal in nature, and that 62 percent of Filipinos live in
these areas.
Even more disturbing is
how climate change primarily affects children. According to a paper published
in the medical journal Pediatrics, children will bear 88 percent of the burden
of diseases related to climate change. Extreme heat waves have caused emerging
infectious pathogens such as the Zika virus and increased incidence of
waterborne bacterial infections. Extreme weather events are also damaging
crops, impacting the food supply and thus childhood nutrition.
Given the adverse
impact on the youth, it is no surprise that calls for cleaner sources of energy
come from millennials. Rooted from the demands of their customers, companies
like Google, Facebook, Apple, AT&T, Walmart and Unilever Philippines have
started to adopt renewable energy sources.
Indeed, global energy
revolution is underway.
Yet, the Philippines
continues to track a different route. Coal plants continue to dominate. Coal
accounts for 50 percent of our country’s power generation, feeding 21 existing
plants and 27 more in the coming years. Conscious decisions need to be made to
start moving away from coal.
We at the Energy
Development Corporation (EDC) have already made a categorical announcement that
our group of companies under our parent firm First Philippine Holdings
Corporation would not invest, build, develop any coal-fired power plants.
Thus far, we are the
only large energy company in the Philippines to declare unconditionally that we
would not do coal-fired power.
It wasn’t always that
way; we were actively bidding for power plants, which included coal, during the
government’s privatization program. Being among the three largest power
companies in the country, we definitely had the organizational capability and
resources to develop coal-fired plants.
Operating in a
deregulated power market in the Philippines means staying competitive and
having the cheapest generation sources in order to keep winning customers.
Coal, given its abundance in the world, was traditionally among the cheapest
fuels.
That stance changed
immensely in November 2013, when our largest geothermal plant in Leyte,
Southern Philippines was directly hit by one of the most powerful typhoons in
history.
Witnessing the enormous
suffering of communities around us, we knew it can no longer be “business as
usual.”
However, we still face
quite a number of challenges. Price competition is intense and retail
competition and open access is underway. Low price is still the main driver of
electricity consumers, thus affecting profit margins of all power producers.
But we’re driving down costs in our geothermal business, both the old-fashioned
way and through the use of new technology.
Another challenge is
the government’s ambivalence on climate change issues. Because there’s so much
political pressure to provide everything at the lowest possible cost, employing
historically more expensive sustainable methods of production has never been
encouraged.
You might wonder what
keeps us committed to the green road despite all the obstacles? There are more
and more companies that are conscious about greening their footprints and
supply chains.
Another reason for the
optimism is that the forces of technology are moving very fast. Solar, wind and
battery storage have experienced exponential cost reductions over the last few
years. In recent years, prices of coal and other fossil fuels have also gone
up, debunking the government’s earlier argument.
When someone tells you
that renewable energy is intermittent and makes power grids unstable, know that
there are many technically and economically feasible ways to handle these
issues, and progressive grids are already incorporating them into their
day-to-day operations.
The world is now moving
toward cleaner energy, including China and Europe. It’s time for the
Philippines to join the bandwagon.
The Green Energy Option
that was improved under the Renewable Energy Law 10 years ago should be
implemented soon. Incentives must be implemented to encourage the use of
geothermal power. Consumers should be given a choice—full retail open access
should be allowed.
Filipinos are some of
the most innovative people on Earth. We should lead the country and the region
toward a future of clean energy.
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