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OurPosition

on

RA 9513RA 9513

Foundation for Economic Freedom, Inc.

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What is renewable energy?What is renewable energy?

Energy from resources that do not have an upper limit on thetotal quantity to be used.

Such resources are renewable on a regular basis, and whose

renewal rate is relatively rapid to consider availability over anindefinite period of time.

These include, among others, biomass, solar,wind, geothermal, ocean energy, and hydropowerconforming with internationally accepted norms andstandards on dams, and other emerging renewableenergy technologies. (RA 9513)

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Fast Facts: the Philippine SituationFast Facts: the Philippine Situation

34%34% of the countrys energy mix is renewablerenewable oraround 5,300 MW out of the 15,000 MW installedcapacity

Contrast to the Global average: less than 10%

Philippines contributes only 0.48%0.48% to globalcarbon pollution (NREB)

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Fast Facts: the Philippine SituationFast Facts: the Philippine Situation

Transportation is the countrys top polluter

Power plants belong to thebottom ten polluters

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Renewable Energy Act of 2008Renewable Energy Act of 2008

Signed into law in December 2008, supposedly toprovide incentivesprovide incentives for investorsfor investors to engage in REprojects in the country

Department of EnergyDepartment of Energy (DOE)

- lead agency

Energy Regulatory CommissionEnergy Regulatory Commission (ERC) anindependent quasi-judicial regulatory agency

supposed to issue FIT (feedFIT (feed--inin--tariff) rulestariff) rules inconsultation with the National Renewable EnergyBoard (NREB) created under Sec.27

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What is FIT?What is FIT?

An RE policy that guarantees payments on afixed rate per kwh for emerging RE sources:solar, biomass, wind, solar, run-of-river hydro

A fancy term for the amount that thegovernment wants to add to our electricitybills to encourage more use of new RE

For all intents and purposes,

FITIS A TAXFITIS A TAX

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What is FIT?What is FIT?

A subsidy to make up for what the REtechnologies cost:

Solar PHP 17.95 kw/hr

Wind-PHP 10.37 kw/hrBiomass PHP 7.0 kw/hr

RoR-PHP 6.15/kwhr

vs conventional

(PHP 5.0 kw/hr)

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We do not oppose REWe do not oppose RE. We oppose the plan to makeFilipino consumers and industries pay PHP 8Bannually for the next 20 years to subsidize and

guarantee the profits of RE developers.

Our PositionOur Position

It is more prudent towaitwait, given advances intechnology, until theuntil the

cost of solar and windcost of solar and windpower drops to paritypower drops to paritywith conventionalsources which aremore efficient.

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Our PositionOur Position

We can increase our share of RE by

rehabilitating and improving existingrehabilitating and improving existing

hydro and geothermal sourceshydro and geothermal sources,

which produce energy far cheaper

than wind or solar.

We support solar for OFFsolar for OFF--Grid smallGrid small

island areasisland areas where the avoided costis much higher (PHP 11/kwhr) due to

the use of diesel

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Our Disagreements with NREBOur Disagreements with NREB

DOE recommended 20 MW for solar but NREBincreased it to 100 MW. This means anadditional surchargeadditional surcharge on consumers.

Why should FIT be imposed for 20 years20 years whenthe minimum proposed by law is only 12years?

No competitive biddingNo competitive bidding whether from amongthe different RE technologies or within aspecific technology.

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Our Disagreements with NREBOur Disagreements with NREB

No biddingNo bidding for terms of less than 20 years. Nobidding, period. All contracts are negotiated.

FIT Rate determined by a risk-adjusted rate

of return. = guaranteed superguaranteed super--profitsprofits Subsidy will not go to cheapest first but all

RE developers are guaranteed subsidy, evenhigh costing wind and solar.

RE Developers are guaranteed cash flow,RE Developers are guaranteed cash flow,profits, collection and against technologicalprofits, collection and against technologicalobsolescence for 20 years.obsolescence for 20 years.

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Our Disagreements with NREBOur Disagreements with NREB

NREB hiding onerous charge againstconsumers by submitting FIT Rate under therule-making power of ERC.

Ergo, no public hearing, no publicationno publication, justpublic consultation EVEN IF THE FIT RATEWILLINCREASE CHARGES FOR ALLINCREASE CHARGES FOR ALLCONSUMERSCONSUMERS. This is a clear violation of theletter and spirit of EPIRA and the mandate ofERC.

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They say; we sayThey say; we say

They say

We have to diversify.

We say

Solar and wind are unreliableSolar and wind are unreliable and cant bebasis for energy diversification.

We need around 5,000 MW in the next few

years to supply growing energy demandOld RE is stillavailable that is yet to beOld RE is stillavailable that is yet to beuntappeduntapped -15,000 MW (hydro and geothermal)

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They say

It is good for the environment.

We say

The Philippines has no obligationno obligation to reduce its carbonemissions. Our contribution to global pollution is almostnegligiblenegligible.

Transportation is the top pollutant; power plants rank in thebottom ten.

We are already producing more than 30% of our power fromRenewables, more than the US at 10 %.

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They say

Energy independence and security

We say

Better results; cheapercheaperalternativealternative.

Solar and wind are ratherinefficient and unsteady sincethey are dependent on weatherand other climatic conditions.Conventional sources are moreConventional sources are morereliablereliable and cost only PHP 5 perkilowatt hour

We stillhave 15,000 MW of15,000 MW ofuntapped hydro and geothermaluntapped hydro and geothermal

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They say

Solar energy is good.

We say

We dont oppose solar energy per se, but

they should go to off-grid small island areas

where the avoided cost (about PHP11/kwhr) is high due to the use of diesel.

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They say

What is PHP 12 centavos per kilowatt hour?We say

It only covers the generation charge.

There are hidden costshidden costs.

NGCP willalso need to

install new

tra

nsmissionlines

andit may require further

rate hikes for

distribution utilities.

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Why does it concern you?

Businesses, whichalready suffer from the

highest power cost in Asia, willhave to suffer

more unnecessarily. This will make them less

competitive.

Investors will not come to the country if power

cost willbecome higher still.

No investments, no job

s.No investments, no job

s.Consumers are being taxed without them

knowing it just to subsidize the profits of these

wealthy RE developers.

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What can you do?What can you do?

File a comment using the official comment format the ERC

File a petition for intervention/relief

Make noise in social media.

Like our page: NO to Electricity HIKE forNO to Electricity HIKE for

FilipinosFilipinos

PROTEST, PROTEST, PROTEST!PROTEST, PROTEST, PROTEST!

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Annex A

P1.6 billion - Daang Hari-South Luzon

Expressway link

P10.59 billion - NAIA expresswayP21 billion - North Luzon-South Luzon

expressway link

P10.5-billion - Cavite-Lagunaexpressway

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Annex B