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Cheaper power may lie in RE

Electricity will remain affordable even as the country transitions to using renewable energy as a primary source

Maria Romero

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JOEL NITO/agence france-presse Transmission lines climb above the hills of Bangui Bay to deliver electricity in Ilocos Norte. Wind mills started supplying electricity to 40 percent of the province in May 2005 and are the first local source of clean energy.

The shift to renewable energy (RE) may provide the answer to the perennial problem of high electricity cost as its use will result to cheaper and more reliable source of power for millions of Filipinos.

In an online forum headed by the Philippine Energy Independence Council on Thursday, Department of Energy (DoE) Undersecretary Jesus Cristino Posadas said electricity will remain affordable even as the country transitions to using RE as a primary source.

If the state-run National Power Corp’s Small Power Utilities Group shifts away from subsidized diesel power, the savings could reach $275 million per year.

Posadas underscored that the agency strictly mandates a competitive selection process in determining which entities, whether foreign or local, get the authority to develop local resources.

Posadas said a more stringent selection process ensures that power sources fueled by RE will be cost-effective.

Discard diesel
A recent study by the US-based Institute for Energy Economics and Financial Analysis said the shift to renewables, especially in small and isolated areas in the country, can provide cheap energy to around 50 million people.
The report, which was published last December, pointed out if the state-run National Power Corp’s Small Power Utilities Group shifts away from subsidized diesel power, the savings could reach $275 million per year.

“Ongoing cost and efficiency improvements for renewables will mean that energy cost deflation will enable the government to reach its goal of 100 percent electrification by 2022,” it said.
Early this month, the DoE formally launched the competitive bidding process to develop local RE resources.

Under the third competitive selection process in awarding RE service contract, five pre-determined areas in the geothermal sector and 17 in the hydropower sector are up for bidding.

Flexible power supply
In October last year, the DoE issued a moratorium on the applications of green coal power plants as it leans towards shifting to “a more flexible power supply mix.”
Energy Secretary Alfonso Cusi said the agency will now prioritize the establishment of a more sustainable power system.

Cusi noted that the system should be resilient and should easily adapt to changes in demand. It should also be flexible enough to accommodate the entry of new, cleaner, and indigenous technological innovations.

“While we have initially embraced a technology-neutral policy, our periodic assessment of our country’s energy requirements is paving the way for innovative adaptations in our policy direction,” Cusi said.

“As the Philippine Department of Energy re-evaluates the appropriateness of our current energy mix vis-a-vis our energy goals, I am optimistic that this would lead to more opportunities for Renewable Energy to figure prominently in our country’s energy future,” he added.

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