PHL seen to benefit from falling solar power cost

June 16, 2020 | 12:05 am By Adam J. Ang

https://www.bworldonline.com/phl-seen-to-benefit-from-falling-solar-power-cost/

THE falling cost of solar energy development leading to cheaper electricity may help the Philippines, where the cost of electricity remains to be among the highest in Southeast Asia, to move further away from fossil fuel use, according to renewable energy developers.

With the growing demand for power and the present climate crisis pushing the country to shun coal and gas, there is no doubt that the Philippines need to seek clean and cheap energy sources for energy security, according to leading solar manufacturer Trina Solar Ltd.

“There needs to be more solar farm developments in the Philippines to meet the country’s growing electricity needs and to reduce the country’s dependence on fossil fuels,” Trina Solar Asia Pacific Senior Sales Director Jun Heong Ku told BusinessWorld.

He cited the technical advancements and growing operational efficiencies of industries, which brought down prices of solar equipment, like modules, mounting systems, and inverters.

The renewable energy projects in the country still lag behind the development of coal and gas-fired power facilities, which are expanding at a “faster” pace, United States-based engineering firm Black & Veatch noted.

“The Philippines has enormous potential for renewable energy but the development of coal and gas-fired power stations in the Philippines is growing at a faster pace than the development of renewable energy, such as solar,” Mitesh Patel, director of Black & Veatch Asia’s renewables business, said.

He added that the lowered cost of putting up solar energy infrastructures allows it to be “financially attractive,” even without support from feed-in-tariffs (FiT), a component of power charges that boosts the development of renewable energy.

About 23 solar projects with a total capacity of 526 megawatts (MW) were endorsed by the Department of Energy (DoE) to the Energy Regulatory Commission for FiT eligibility. Among these is the 133-MW Cadiz Solar Power Plant, which is powered by Trina Solar’s modules.

The share of renewables sources in the country’s power generation mix dropped by 20% since it last peaked at 36% in 2006, Trina Solar noted.

Solar farms, Mr. Ku said, are “much quicker” to build than fossil fuel-fired plants. It also creates high-skilled jobs and may help the country power more off-grid communities through solar-powered microgrid systems.

Black & Veatch estimated an additional 3,700 MW in solar installation to power the country by 2024.

The solar business in the country, it said, will stay afloat with recent progress on the implementation of the renewable energy market rules, the DoE’s Green Energy Option Program, and the Bangko Sentral ng Pilipinas’ rules on sustainable finance.

The adoption of net metering, or the billing mechanism which credits solar panel users for contributing excess energy into a grid, as well as the use of energy storage systems or batteries, are yet to be promoted in the country to further secure its energy needs, Mr. Ku said.

Also, solar energy adoption may be bolstered with the recent creation of bifacial modules, which generate electricity from the front-side and the back-side of the module. These are coupled with trackers that help in maximizing the amount of light the modules absorb by moving the module to follow the movement of the sun.

“It is important for the Philippines to develop renewable energy sources, so it can be more energy independent and be less dependent on overseas [sources] for the supply of fossil fuels. This will in turn help to ensure energy security,” the senior official said.

Philippine energy companies are making efforts to cut back on fossil fuel and to roll out more renewables projects.

For example, Ayala-led AC Energy, Inc. has promised to divest from coal by 2030. In the next five years, the energy company aims to add 5,000 MW in its portfolio, with half of the generated power to be coming from renewable sources.

“To meet their sustainability targets, energy companies are tapping on industry leaders with global best practices and regional execution to rebalance their energy portfolio,” Mr. Patel noted.