PPP for irrigation projects coming soon
The National Irrigation Administration (NIA) aims to jump-start irrigation projects using the public-private partnership (PPP) framework within the first 12 months of Marcos administration.
The NIA has so far received investment pledges amounting to more than P1 trillion. It did not identify potential private partners, but noted that most of them were Filipino entities.
The agency announced in June it would use the PPP model to accelerate the development of 50 potential irrigation projects nationwide. Majority of these are big-ticket multipurpose projects with hydropower component, such as small river irrigation with reservoirs that can be utilized for floating solar power farm and/or mini-hydroelectric power plant.
The Balog-Balog Multipurpose Project (hydropower component) in Tarlac, Ilocos Sur-Ilocos Norte-Abra Irrigation Project in Region I, Panay River Basin Integrated Development Project in Capiz, Ilaguen Multipurpose Irrigation and Power Project in Isabela and Balintingon Multipurpose Project in Nueva Ecija are among the projects identified for PPP.
NIA administrator Benny Antiporda said, “what we’re looking at is we can roll it out before the second year of the Marcos administration begins.”
List of opportunities
Likewise, the NIA will list possible investment opportunities, including aquaculture farming, hydroelectric power generation and floating solar panels. It is also looking at covering irrigation canals with solar panels to generate power and minimize water evaporation at the same time. It also raised the possibility of bulk water distribution being integrated to each NIA project.
Undertaking irrigation facilities have been difficult for NIA due to funding constraints. It initially pegged the cost of constructing large-scale projects at P594 billion, but because of the uptick in cost of materials, the amount has increased to P800 billion.
It also pinpointed right-of-way and site acquisition, as well as issues on indigenous people’s rights as among the major factors delaying implementation of irrigation projects.
Addressing bottlenecks
Hoping to address these issues, the NIA will form a Right of Way and Site Acquisition Committee for PPP projects, while strengthening inter-agency cooperation with the concerned government agencies and local governments.
“NIA is faced with the issue of the low economic viability of its projects, considering that the primary purpose of NIA projects is the irrigation of our farmers’ agricultural lands for a nominal fee, which necessarily entails a low profit margin that is not attractive to potential private partners,” its briefer read.
“NIA is thus presently exploring the addition of investment opportunities that may improve the financial aspect of NIA projects potentially to be applied in PPP projects to provide a reasonable return of investment to the partner-investors,” it added.
There are 964,000 hectares of agricultural land without irrigation in the country. Assuming that 95 percent of these would be used for palay (unhusked rice) production, NIA estimated they could produce about 8.24 billion kilograms of palay or P4.12 billion kg of rice annually.
Currently, 2.49 million hectares of irrigated lands are capable of producing 11.28 billion kg of palay, equivalent to 6.77 billion kg of rice a year.
“The potential additional yield would not only cover the shortage of 550 million kilos of rice but would also afford an opportunity for rice export of up to 3.38 million kilos of rice per year,” the NIA said. INQ
