PUERTO PRINCESA CITY, Palawan – While Palawan civil society organizations (CSOs) consider the Renewable Portfolio Standard (RPS) as long overdue, they say it gives them a glimmer of hope as it will compel the power distributor Palawan Electric Cooperative to finally tap the province’s rich renewable energy (RE) potential.
Cynthia Sumagaysay-Del Rosario, one of the lead conveners of the Palawan Alliance for Clean Energy (PACE), said the green groups have long been waiting for the Philippine RPS Rules for Off-grid Areas to be created and eventually implemented.
“We are so excited with this because it’s long due,” Sumagaysay-Del Rosario said during the open forum held as part of the public consultation for the final draft of the said rules in Puerto Princesa City Thursday, October 5.
RPS, as provided under the Renewable Energy Act of 2008, is a policy mechanism that obliges the power industry participants to source a percentage or all of their energy requirements or supply from eligible RE resources.
“Until now, the RPS has yet to be implemented,” said Atty. Jose Layug, Jr., National Renewable Energy Board (NREB) chairman.
The NREB, along with the Department of Energy RE Management Bureau (DOE REMB), are doing public consultations for the Philippine RPS Rules for Off-grid Areas, with its final draft up for endorsement to DOE Secretary Alfonso Cusi next week.
“In fact, to be very candid, as early as March 2011 when I took the position at the DOE, we already finished the [draft of] RPS,” said Layug. “I submitted that to Secretary [Jose Rene] Almendras, [however] it was never signed. But now I’m very hopeful with Secretary Cusi.”
Once approved and implemented starting January 2018, Paleco and other distribution utilities (DUs) operating in island provinces will be mandated to source power from eligible RE resources, such as biomass, waste to energy technology, wind, solar, hydro, geothermal, among other emerging RE technologies.
“Palawan has a lot of land, so there is definitely [a] potential to put up renewable energy here. Ironically, I’ve not seen any… With all those rules, we hope Paleco will start contracting because it will become a mandate,” Layug said.
The PACE, meanwhile, sees the RPS would help the Philippines in achieving its goal of 70% reduction in carbon emissions by 2030 and hitting the 15.3GW renewable energy target, the country’s commitment under the Paris Climate Agreement.
According to Layug, the plummeting costs of RE technologies, as developers confirmed, makes it more viable than before. “It’s high time that we protect our environment. There’s no reason for the high cost of electricity,” he said.
For instance, he added, the solar power is now “much more competitive” with its current pricing that ranges from P8/kWh to P11/kWh, way cheaper than Paleco’s current P12/kWh diesel-produced power.
“This is what we hope for, especially in Palawan,” he said.
The NREB chair said that the power problem besetting this ecologically important province for years is an enough reason to shift to RE. “Now it’s the right time to go for renewable energy. It’s cheaper, it’s cleaner,” he said.
In case RE is not available in an off-grid area, he added that the RPS directs the mandated participants to connect with the RE market and buy RE-produced electricity for compliance purposes, without passing on the additional cost to the consumers.
Layug said the RPS gives a three-year transition to mandated players, with full compliance expected starting 2019. This period allows the mandated participants to prepare, specifically in procuring and commissioning of required RE sources through competitive selection process.
“The transition period is there because we know that it takes time to contract and build the power plant,” he said, adding, for instance, run-of-the-river power facility takes more or less two years to finish.
Sanctions are laid down in the RPS rules to ensure the compliance among mandated power industry players in off-grid areas.
“It’s a matter of enforcement and we can assure you if we see somebody not complying, we at the NREB will raise that concern for the DOE to file the appropriate administrative, civil and criminal cases,” Layug said.
Violating key officials of distributor utilities may face administrative liability, entailing a penalty ranging from reprimand to revocation of license with corresponding fine ranging from a minimum of P50,000 to P500,000, depending on the gravity of the offense.
They may also be criminally liable for violating the RE Act, and suffer the penalty of one-to-five-year imprisonment, and/or a fine ranging from a minimum of P100,000 to P1-million upon the court discretion.
Paying the fines, however, cannot be passed on to the consumers, Layug added.
Grizelda Mayo-Anda, executive director of Puerto Princesa-based Environmental Legal Assistance Center, however said that more engagement with Paleco has to be done, since the power distributor until now has yet to begin its competitive selection process for RE companies.
“On the positive side, it gives us a little hope because somehow we can have the DOE pushed for RE implementation in Palawan,” Mayo-Anda, also one of PACE’s lead conveners, told the media.
“But how do we make sure that the Paleco, which is supposed to be mandated under the law to ensure that 1% of its energy source comes from RE? That is an area of work where we need to plan for.”
In a previous interview, Paleco Board Chairman Jeffrey Tan Endriga said they would “release terms of reference to invite potential investors to engage in a bidding process for RE.”
However, Endriga said Paleco could not solely rely on renewables, which he believes to be intermittent. And if Paleco is going to harness at least one, say solar energy, he added that it should be hybrid or a combination of renewables and base-load fuel like diesel
On top of this concern, Mayo-Anda said the lack of political will remains a challenge in the province, considering the Palawan Island Power Development Plan (PIPDP) 2015-2035 has been kept on shelf for four years now.
“It remains to be a paper plan because we can’t see how it is being articulated on the ground,” she said.
The ELAC chief has urged the decision makers to revisit the RE Act and the PIPDP.
“It takes political will, leadership and fortitude to actually mobilize the whole of Palawan to address our power problem and encourage renewable energy players,” she said.
The creation of PIPDP was jointly led by the provincial and city governments, with the help of DOE, USAID and CSOs. It points to RE as the cheapest source of power for the province, and has identified potential run-of-the-river hydropower projects in Palawan with an estimated capacity of 182.47 megawatts, which can provide energy supply of up to 959 gigawatt hours.
“The least cost option there is not coal. It’s actually run-of-the-river hydro mixed with diesel and bunker,” said Mayo-Anda, who’s one of the key voices in the fight versus the proposed coal-fired power plant in the province since 2012.
“We want the leadership of Paleco, including our provincial and city government officials to really be enlightened,” she added, citing especially the key officials who have been vocal in supporting for the fiercely opposed coal project.
Since only Paleco representatives and not its top-ranking officials were able to attend the public consultation, Layug said he will do the same presentation at the power distributor’s office. He also vows to meet with Palawan’s key government officials to orient them about the RPS rules.
“The most important party for the RPS off-grid is the DU or the cooperative because without them how will we implement this?” Layug said.
Tasked to implement the mechanisms set under the nearly a decade-old RE Act, the NREB will help Paleco and other off-grid power utilities in ensuring its readiness in incorporating RE in its energy mix.
“When you do some planning for renewable energy, the coops and [other] DUs need to make sure that their transmission lines, distribution lines are also ready,” Layug said.
“Let’s make sure that can be addressed before you start signing up PSAs (power supply agreements).”
The public consultation is first in the series of consultations, which will also be held in Oriental Mindoro (Oct. 12), Cebu (Oct. 19) and Cagayan de Oro (November 9).