I. The potential of renewable energy in the Philippines
The traditional energy reserves in the Philippines are scarce, and energy products such as oil and coal rely heavily on imports, but the potential for renewable energy development is enormous. According to statistics compiled by the Philippine Energy Ministry in 2007, Philippine oil production accounted for only 1.6% of total domestic energy supply, natural gas accounted for 7.7%, and coal production accounted for 4.6%, but renewable energy accounted for 41.8% of the Philippines' energy supply. Among them, the contribution of renewable energy in heating is as high as 65%, because most rural families retain the habit of using plant residues for kitchen fuel. In terms of power supply, by the end of 2007, the Philippines had a total installed capacity of 15.973 million kilowatts of power generation, thermal power generation was still the mainstream, and the contribution rate of renewable energy such as geothermal power and water power was about one-third, and the development space was relatively large. Because of the lack of power generation, the Philippine electricity price is extremely high and it is the highest electricity tariff in Asia. According to a 2009 study by JPMorgan Chase, the Philippines’ electricity price is about 14 cents per degree, which is more than Japan’s (11 cents). The fact that electricity prices are too high and that rural areas have not yet been energized has prompted the Philippine government to resolve to solve the problem of energy supply.
What is the potential of renewable energy in the Philippines? Currently available data are mainly from the research of some universities and foreign institutions. According to a survey report submitted by the Philippine Renewable Energy Alliance to the Senate in 2009, the potential of renewable energy in the Philippines is more than 200 million kilowatts. Among them, the geothermal energy is 4.531 million kilowatts, the hydropower is 1309.7 million kilowatts, the wind power is 76.6 million kilowatts, and the ocean energy is 170 million kilowatts. The available biomass energy potential is about the same as the energy of 277 million barrels of fuel oil each year.
The potential and distribution of renewable energy released by the Philippine Department of Energy is as follows:
(a) Geothermal energy
The Philippines is rich in geothermal resources and has also been well-utilized. It is the world's second largest geothermal power generation country after the United States. The unexploited geothermal energy potential is about 2.6 million kilowatts, and the currently proven geothermal potential is 1.2 million kilowatts, of which 6.1 million kilowatts are in the area of ​​Philippine-owned Philippine National Oil Company - Energy Development Corporation (PNOC-EDC). ) Controlled.
(B) Hydraulic power
According to the Philippine National Electric Power Company, the undeveloped hydropower potential in the Philippines is about 13.1 million kilowatts, of which 85% can be used to build power plants with an installed capacity of more than 10,000 kilowatts, and the rest are micro-hydropower stations. Power generation is only for local communities. Some hydroelectric power station projects on Luzon Island are open to private investment.
(c) Wind energy
The Philippines is located on the edge of the Asian-Pacific monsoon zone and has good wind energy potential. According to a study by the Philippine Meteorological Administration, the potential for wind power generation is 31 watts per square meter. A study conducted by the American Renewable Energy Laboratory in 1999 showed that the Philippines has more than 10,000 square kilometers of area with good or very good wind energy development potential. Assuming a power generation of 7,000 kilowatts per square kilometre, the potential for wind power could reach 70 million kilowatts, which is the largest wind power potential in Southeast Asia. The main wind energy gathering places as follows:
- Ilogos Province
- Alpine Province
- Cuyo Island
-Basque
- Gatatonnes
- Tagaytay City
- Lubang and Cabra
- Batangas Province West
- Guimaras
- Muscat Province
- West Nile Province, Northwest Coast
- Palawan Province
(D) Solar energy
The Philippines is located in the north of the equator, with strong sunshine throughout the year. It absorbs 128-203 watts of solar energy per square meter, but the main solar energy distribution area needs to be further confirmed. At present, there are 1,000 kilowatts of installed solar power in the Mindanao region.
(five) ocean energy
According to research conducted by the National University of the Philippines in Mindanao, the Philippines has an ocean energy reserve of approximately 1,000 square kilometers, and its theoretical potential for generating electricity is 170 million kilowatts. The main distribution areas include:
- Boho - Tarion Straits
- The Brazilian Strait
- Surigo Channel
- Gabork
- Sinantu Marine Corridor
- St. Bernardino Strait
- Basilan Strait
- San Juanikos
(VI) Biomass energy
According to the data from the Ministry of Agriculture and the Ministry of Environment and Natural Resources of the Philippines, the available biomass energy in the Philippines was roughly equivalent to the energy of 271.7 million barrels of fuel oil in 2003 and grew at a rate of 1.9% per year. By 2012, the figure It is expected to reach 323.1 million barrels. Biomass that can be used to generate electricity or heat includes: bagasse, distributed in three, four, six, and seven areas; coconut shells, distributed in four, eight, nine, and eleven areas; rice husks and straw It is distributed in District 2, District 3, District 4 and District 6.
The Philippine government has great confidence and high expectations for the development of renewable energy. According to the "Energy Development Plan for 2003-2012" formulated by the Philippine Department of Energy, the Philippines hopes to increase the installed capacity of renewable energy from 4.449 million kilowatts in 2002 to 9.147 million kilowatts in 2013, increasing the proportion of electricity generation to 40%. As the world’s top geothermal power generation country and the largest wind power producer in Southeast Asia, it needs to attract 10 billion US dollars of investment. Since the enactment of the "Renewable Energy Law" at the end of 2008, the Philippine Energy Department has signed 206 renewable energy service contracts with enterprises, attracting domestic and foreign investments of more than 2 billion U.S. dollars, but it is still far from the government's goal. At the end of 2008, the installed capacity of renewable energy in the Philippines was only 5.3 million kilowatts. Recently, the Philippine Department of Energy formulated the "2009-2030 Energy Plan" and proposed to double the installed capacity of renewable energy power sources in 2008.
Second, the Philippines renewable energy policy
To strengthen the development and utilization of renewable energy and increase energy self-sufficiency, the Philippine government has implemented a series of legislation, such as the geothermal law of 1978, the Small Hydropower Act of 1991, the ocean energy, solar energy, and wind energy of 1997, and the electricity of 2001. The Sectoral Reform Act, the renewable energy policy framework in 2003 and the biodiesel law in 2006, but the most important of these was the Law on the Promotion, Use, and Commercialization of Renewable Energy, promulgated in December 2008. This law is the first comprehensive renewable energy legislation in Southeast Asian countries. It draws on the advanced experience of developed countries in the development of renewable energy, and provides favorable fiscal and tax incentives for the development and utilization of renewable energy, and has established a good institutional framework. The relevant UN agencies said that the law provided a good example for other countries in Southeast Asia to carry out relevant legislation.
(I) Tax benefits
1. Tax benefits for renewable energy developers:
(1) Withdrawal of income tax for seven years from the commercialization of the project;
(2) After the aforementioned 7-year tax holiday expires, only 10% of the company's income tax is imposed;
(3) Exemption of import tariffs on machinery and equipment and materials for 10 years from the date of obtaining the development certificate;
(4) The special real estate tax rate for machinery and equipment is only 1.5%;
(5) Operating losses that have not been offset during the first three years of operation of the project can be deducted from taxable income in the next seven years;
(6) Depreciation of fixed assets can be accelerated at twice the normal rate;
(7) Fuel or electricity produced from renewable energy is exempt from VAT;
(8) Exempt any tax from the income from carbon emissions trading;
(9) 100% subsidizing VAT and tariffs for the equipment and materials required for the purchase of renewable energy produced in the Philippines;
(10) The electricity provided free of charge by developers for use by themselves or off-grid is exempt from the fees stipulated in the "Power Sector Reform Law."
2. Tax benefits for manufacturers and suppliers of renewable energy equipment and materials:
(1) Tax-free import of production materials and components;
(2) 100% subsidies on VAT and tariffs for the purchase of machinery, equipment, and materials for the development of renewable energy produced in the Philippines;
(3) Exemption from income tax for 7 years;
(4) VAT is waived for its transactions.
3. For farmers who grow biomass energy crops (Jatropha, sugar cane, coconut, etc.), import or purchase of fertilizers, pesticides, and agricultural machinery and equipment are exempted from import duties and value-added tax.
(II) Institutional Framework
This law draws on the experience of developed countries in Europe and the United States in promoting the development of renewable energy, and specifies the following customary policies:
- Renewable portfolio standard (RPS): This policy mandates that power companies must purchase a certain percentage of renewable energy power.
- Fixed-in-tariff (FIT) policy: This policy ensures that renewable energy developers sell electricity at a specific price, while requiring the power company to purchase it.
- Net Metering: This policy is a tariff settlement policy that requires the power company to buy back excess power from customers installed with renewable energy generation technology at a certain price, or to deduct from the consumer's general bill Renewable energy generation quantity.
In order to advance the implementation of these policies, the law specifically establishes the National Renewable Energy Commission (NREB) and the Renewable Energy Trust (RETF). NREB consists of relevant government departments (Department of Energy, Ministry of Trade and Industry, Ministry of Finance, Ministry of Environment and Natural Resources, etc.), relevant state-owned enterprises (National Power Corporation, State Grid Corporation of China, National Petroleum Corporation, Electric Power Market Corporation, etc.) and renewable energy development. The representatives of enterprises, financial institutions, non-governmental organizations, and private companies concerned were established in September 2009. Perez, the former energy minister, was responsible for the formulation of RPS and FIT standards and the development and implementation of renewable energy in the Philippines. Planning, monitoring the use of renewable energy trusts, etc. The source of funds for the RETF is legally guaranteed and is mainly used to fund the research, development and promotion of renewable energy. The Act also established the Renewable Energy Administration (REMB) within the Ministry of Energy. Companies engaged in renewable energy development must register with REMB to obtain a permit and register with the Ministry of Trade and Industry Investment Agency (BOI) to enjoy the provisions of the law. Preferential policies.
Third, the advantages and disadvantages of developing renewable energy in the Philippines
After the promulgation of the Renewable Energy Law of the Philippines, it played a very good role in promoting the development of renewable energy and attracted a large amount of investment, including a small amount of foreign capital. Recently, the Asian Development Bank has also indicated that it will provide a billion U.S. dollars to the Philippines for the promotion of renewable energy development. After July this year, the government of Aquino III will come to power, and in order to promote the economic development of the Philippines, it will intensify efforts to attract investment in the field of renewable energy. There are potentials, policies, and determination of the government. This is the main advantage of developing renewable energy in the Philippines. However, we must also clearly understand that the development of renewable energy in the Philippines may face the following problems:
(1) Legal restrictions on foreign investment: The Philippine constitution stipulates that foreign participation in energy exploration, development and utilization projects can only occupy up to 40% of the shares. This restriction is one of the main reasons that foreign investment is less likely to enter the industry. At present, the development of geothermal energy and hydraulic resources in the Philippines is mainly occupied by domestic companies such as PNOC-EDC and Aboitiz. Foreign capital must enter into cooperation with domestic companies.
(b) Social and cultural resistance: The Philippines' National Comprehensive Protected Areas System Law and the Aboriginal ** Law and other related laws pose obstacles to the development of geothermal energy and other resources locally, and local communities and residents may Development is prejudiced and even hostile.
(III) Pre-exploration risks: The Philippines is lagging behind in science and technology, and the government lacks financial resources. There is a lack of investigation and research on the specific information on the distribution of renewable energy sources. The current information obtained is relatively crude, which means that once commercial development is carried out, a large amount of preliminary work will be required and faced Certain risks.