P41.8 Billion Reasons Why We must Distinguish Clean Energy from Renewable Energy

David Celestra Tan, MSK

12 October 2016

Solar lobby groups continue to push for the Philippines to adopt Renewable Energy as a national energy policy target. Many Legislators and policy makers automatically mouth Renewable Energy as a sacred goal for the country.

Do they really mean Renewable Energy or it is Clean Energy and Climate Change that they are trying to address?

Are they one and the same? Why is there a need to distinguish Renewable Energy from Clean Energy? There is a 41.8 billion reason.

Technically, Renewable energy is generally defined as energy that is collected from resources which are naturally replenished on a human timescale, such as sunlight, wind, rain, tides, waves, and geothermal heat.

 In many countries including the USA, Renewable Energy is used interchangeably with Clean Energy. But in the Philippines it is important to distinguish Renewable Energy from Clean Energy in establishing energy mix policy.

The RE lobby groups including some senators have been pushing for as much as 30% of the country’s energy mix to come from RE. And many other senators and congressmen including some business leaders and policy makers are jumping on an RE bandwagon in the name of climate change. If we don’t watch it, the country and congress will pass policies to try achieve that “noble” goal of 30% renewable energy and feel like they are saving the world.

In the Philippines “Renewable Energy” refers to subsidized energy under the Feed In Tariff law as defined under the Renewable Energy Law of 2008 or Republic Act 9513. There are six (6) RE technologies. Solar, Wind, Biomass, run of river hydro, Ocean Thermal, and something called Hybrid. Note that under this law, geothermal is not covered by the Feed In Tariff subsidy program although technically geothermal is considered “renewable”.

The FIT subsidies on these technologies range from P1.00 for biomass and run of river hydro to P3.80 per kwh for solar and wind. If the Philippines adopts a 30% renewable energy target as defined by the RE law of 2008, it means 4,500mw of RE nationwide. Considering the number of powerful lobbyists pushing for solar, fully 75% of this will be solar and wind. 75% of 4,500mw will be 3,375mw which can produce energy of about 11 billion kwh a year. At a P3.80 per kwh subsidy, solar and wind would require a consumer subsidy of P41.8 billion PER YEAR. We estimate that the country uses 46 billion kwh a year, about 30 billion kwh in Meralco area. Solar and wind subsidy alone will cost P0.91 per kwh. At the 20 year typical contract of Solar, P41.8 billion a year totals P836 Billion in consumer subsidies.

Climate Change

The mother objective of all these green energy movement is climate change. And climate change actually requires clean energy or zero carbon. Clean energy means renewable energy PLUS big hydro, geothermal, and natural gas, and even nuclear energy. It even includes energy efficiency programs. All these clean energy technologies are grid competitive and do not require any consumer subsidies. Big hydro and nuclear can even be lower than the current coal energy price of P3.75 per kwh and be infinitely cleaner than coal.

There is therefore 41.8 billion reasons why the Philippines should not be lured and misled into adopting a “renewable energy” target instead of the enlightened “clean energy”. It is critical that the policy and objective must be CLEAN ENERGY and not Renewable Energy.

If our policy objective is clean energy, there will be more attention to the encouragement of hydro projects in Mindanao, in Luzon, and in the Visayas. It means more exploration in geothermal energy. It means more enlightened holistic studies on a rational nuclear option. It means putting a reasonable limit on the heavily subsidized solar and wind. It means more government support for run of river mini-hydro’s and biomass projects.

Let us not be hoodwinked into adopting renewable energy in the name of climate change. Let us adopt CLEAN ENERGY instead. There is a world of difference.

Matuwid na Singil sa Kuryente Consumer Alliance Inc.

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