Advocates stress huge savings, job opportunities from renewable energy
Despite the mounting opposition to the government’s renewable energy plan, advocates from the government and industry have again stressed the benefits and opportunities that the Philippines might miss should it not pursue and implement the Renewable Energy Law.
The proposed 830 megawatts to be generated from renewable energy sources (biomass, ocean, hydro, solar and wind) alone will save the Philippines from importing as much as 2.06 million barrels of oil annually, equivalent to monetary savings of $118.79 million (roughly P5 billion) every year.
Based on a price of $100 a barrel, these savings can run up to as much as $4.07 billion (about P175 billion) over a 20-year period, according to documents from the Energy Regulatory Commission.
For the national and local governments, the 830 MW of renewable energy capacity will likewise redound to payments of as much as P1.67 billion a year in the form of government share, real property and local business taxes, among others. Over a 20-year period, the amount is expected to balloon to P35.4 billion.
These estimates approximated the benefits that can be derived from an installation target of 830 MW that had been set over the next three years. The Department of Energy, however, lowered this installation target last June to only 760 MW and the new estimates have yet to be disclosed.
Based on the industry players’ estimates, a 760-MW installation target could generate at least 20,000 in direct and indirect jobs, apart from the expected monetary savings and additional revenue stream for the government. When the installation target rises up to 2,500 MW, some 50,000 new direct and indirect jobs could be generated.
Based on the 760-MW installation target, the additional burden to be imposed on all power consumers or also known as feed-in-tariff allowance (FIT-All), has gone down to 10.50 centavos a kilowatt-hour from the previous 12.57 centavos a kWh
Since opposition to the use of renewable energy was centered on the FIT-All, sources clarified that the imposition of such a mechanism would not increase the cost of electricity in the country, but even lower it over the long term, once the projects go online.
As the feed-in-tariff for each resource is locked for 20 years, this means that customers are insulated from sudden and unnecessary spikes in global prices as seen in the case of oil and coal over the past years.
“Fossil fuel prices have shown continual increases throughout the years. Being a depletable resource, this is inevitable. The Philippines has very limited fossil fuel resources, but is blessed with abundant supply of renewable energy resources,” another source said.
Sources explained that while the FIT is fixed, the FIT-All is not. FIT-All is the difference between the feed-in-tariffs granted to each renewable energy source and the computed “avoided cost” from fuel and coal-fired power generation, currently estimated at P4.50 a kWh.
