Let us begin the New Year on a positive note by highlighting the fact that
things are looking rosy for the country’s emerging renewable energy industry as
investments in so-called green technology soared at the close of 2009,
auspiciously ushering in 2010.
In a real sense, 2009 ended with a big bang for the energy sector in line
with the Renewable Energy Act of 2008 or Republic Act 9513, giving attractive
incentives to investors at the dawn of a new decade to build renewable energy
power plants instead of those based on fossil fuels.
Viewed in light of the projection that the country’s power demand will
outstrip power supply by 2010, it becomes all the more urgent and ideal to meet
that demand with renewable energy.
Toward this end, it also helps that the level of global awareness about the
ramifications of climate change has significantly increased, thereby making
renewable energy more widely acceptable.
There is no doubt that, aside from other financial institutions, the
P50-billion fund earmarked by the Development Bank of the Philippines shortly
after the energy bill was enacted into law will be a tremendous boost in
drawing foreign and local investors toward setting up renewable energy projects
in the Philippines.
Given the steadily increasing high price of fossil fuel, the shift is now in
favor of investing in green technology. It has been established that although
the cost of setting up renewable energy plants is more expensive compared to
conventional power plants, in the long run it is more profitable to go for
green technology and, as a bonus, it helps a lot in reducing carbon emissions.
Specifically, renewable energy developers can look forward to attractive
incentives, to wit:
Seven year income tax holiday.
Carbon credits generated from RE sources will be free from taxes. A 10%
corporate income tax, as against the regular 30%, is also provided once the
income tax holiday expires.
Energy self-sufficiency to 60% by 2010 from 56.6% in 2005, by tapping
resources like solar, wind, hydropower, ocean and biomass energy.
Renewable energy facilities will also be given a 1.5% realty tax cap on
original cost of equipment and facilities to produce renewable energy.
The bill also prioritizes the purchase, grid connection and transmission of
electricity generated by companies from RE sources.
Power generated from RE sources will be value added tax-exempt.
A net metering scheme will give capable consumers the option to generate
their own power. Net metering will allow RE producers to earn from the power
they contribute to the grid, and are also charged for electricity drawn from
the grid.
Based on a 10-year period starting in 2003, the Department of Energy (DoE)
expects renewable energy to supply 40 percent of the country’s energy demand.
By 2013, after running the course of the said 10-year period, the DoE foresees
renewable energy sector providing 9,147 megawatt, a whopping 100 percent
increase from today’s level of 4,449 megawatt.
You may have observed that all this pertains to the future, like saying it’s
all pie-in-the-sky and so you may ask, what about today, in the here and now,
what are "doables” in the energy sector?
For one, our country is the second largest producer of geothermal energy and
if we get out act together we can be the renewable energy hub in this part of
the world. This brings us to compressed natural gas (CNG) which can fuel our
transport system.
Under the government’s Natural Gas Vehicle Program for Public Transport, it
was announced by DoE early last year that about 200 CNG-fed buses would be
plying Metro Manila and the provinces of Batangas and Laguna. I don’t know how
this program is faring but it seems more effort should be exerted to make its
presence felt.
