This will cover activities under the broad umbrella of energy efficiency and clean energy, where large investment are needed to support government's plan.
The project's concept paper was approved last year and ADB recruit a range of individual consultants to prepare the proposed components.
The proposed components for study are:
(i) energy efficiency: distribution (as hire purchase) of energy efficienct appliances (TV, air-conditioners, fridges and fans). These component may also finance scaling up the public-lighting and efficienct buildings components of the Philippine Energy Efficient project. However, in September 2012, after extensive consultations with the civil society, the Efficient Appliances Project was dropped and a solar rooftop project, with a revised scope, was agreed and included in the updated Country Investment Plan for the Philippines.
(ii) market for electric vehicle: distributing (lease or hire purchase) about 20,000 electric tricycles replacing 2 stroke and 4 stroke tricycles that are common in metro-Manila (200,000 units) and across the country (3,500,000 units). Tricycles produce about 10 million tons of CO2 in the Philippines.
The ensuing loan, Market Transformation through Introduction of Energy-Efficient Electric Vehicles Project (the e-trike project) was approved on 11 December 2012. The balance of the TA fund is being used to assist the EA in: (i) promoting and marketing the e-Trikes to the local government units; (ii) launching industry meeting/s on the technical aspects of the project; (iii) strengthening capacity of DOE staff on procurement and implementation; (iv) preparing a report and outline of an Operations Manual highlighting procedural flows, timelines, documentary and other requirements, procurement, financial, and logistical plans; (v) providing technical support in the establishment and pilot operation of the charging infrastructure including the installation of solar charging stations; and (vi) providing technical and administrative support to secure UNFCCC registration.
|Project Rationale and Linkage to Country/Regional Strategy
The Philippines is a net importer of energy, mostly in the form of fossil fuels; the demand for energy is also growing with increased population, rapid urbanization, improved lifestyle and overall economic growth. Use of fossil fuels is causing climate change and will severely impact this archipelago country of more than 7000 islands. Hence the Governments main policy challenges are: tackling climate change, reduce reliance on imported fossil fuels, and improve energy security ensure reliable, stable and sustainable supply of energy at affordable prices and at an acceptable social cost. Investments in indigenous renewable energy and energy efficiency (clean energy) will address all these challenges, but the market in its current form is unable to attract necessary investments in clean energy.
As most fossil fuels are imported, increased CO2 emission is a proxy for greater reliance on imported energy. Under a business as usual scenario, between 2007 and 2030: the total greenhouse gas emissions for the power sector will increase by 400% (from 26 MtCO2e to 140 MtCO2e); and for the transport sector by more than 200% (from 29 MtCO2e to 95 MtCO2e) driven by substantial increase of import of crude oil (for transport) and coal (for power generation). Despite large potentials for renewable energy, new coal power plants are being planned, as a least cost solution, and by 2030, coal power plants will contribute more than 90% of the total CO2 emissions. Emissions from the transport sector represents 30% of all pollution, and a large part is contributed by the inefficient old form of public transport tricycles (3.5 million) and Jeepneys (250,000) with poor quality engines. CO2 Emission from the motorcycles and tricycles alone accounts for more than 10 million tons per year.
An alternative scenario with net increase of emission by only about 15% to 30% by 2030 is possible with about 10% to 15% increase in energy efficiency across all sectors and increased use of renewable energy. Energy efficiency, the key component of this alternative scenario, is also an essential tool for lessening the impact of possible increase in electricity prices, caused by the universal charge that may be imposed on all customers to finance the proposed incentives for renewable energy . The Government is committed to energy efficiency, and has developed the energy efficiency roadmap during the 2008 Philippine Energy Summit through extensive consultation with all stakeholders. Although relatively speaking, because of the high electricity price, clean energy projects are financially more attractive in the Philippines, unfortunately, without broad market transformation new technology, policy, institutions, investors, incentives, consumer awareness and wider consumer acceptance the alternative scenario cannot be achieved.
This will study a range of options for energy efficiency and energy efficienct electric vehicles.