Philippines : Rural Community-Based Renewable Energy Development in Mindanao

Sovereign Project | 44132-012

The Government of the Philippines asked the Asian Development Bank (ADB) to provide policy and advisory technical assistance (TA) to pilot and develop viable business models for rural community-based renewable energy in Mindanao. The TA will impact investment in renewable energy projects in the Philippines. The outcome will be development of a business model for livelihood development using renewable energy in the Caraga region of Mindanao. The TA will develop the renewable business models through at least five pilot systems, using microhydro, solar photovoltaic, small wind, and other indigenous sources, with an estimated capacity of 200 kilowatts (kW) overall to serve the energy needs of about 1,500 households in the Caraga region of Mindanao.

Project Details

  • Project Officer
    Jung, Choon Sik
    Southeast Asia Department
    Request for information
  • Country/Economy
    Philippines
  • Modality
  • Sector
    • Energy
Project Name
Rural Community-Based Renewable Energy Development in Mindanao
Project Number
44132-012
Country / Economy
  • Philippines
Project Status
Closed
Project Type / Modality of Assistance
  • Technical Assistance
Source of Funding / Amount
TA 7781-PHI: Rural Community-based Renewable Energy Development in Mindanao
Source Amount
Asian Clean Energy Fund under the Clean Energy Financing Partnership Facility US$ 2.00 million
Strategic Agendas
  • Environmentally sustainable growth
  • Inclusive economic growth
Drivers of Change
  • Gender Equity and Mainstreaming
  • Governance and capacity development
  • Partnerships
Sector / Subsector
  • Energy / Energy efficiency and conservation - Renewable energy generation - small hydro - Renewable energy generation - solar - Renewable energy generation - wind

  • Finance / Inclusive finance

Gender
Gender equity theme
Description

The Government of the Philippines asked the Asian Development Bank (ADB) to provide policy and advisory technical assistance (TA) to pilot and develop viable business models for rural community-based renewable energy in Mindanao. The TA will impact investment in renewable energy projects in the Philippines. The outcome will be development of a business model for livelihood development using renewable energy in the Caraga region of Mindanao. The TA will develop the renewable business models through at least five pilot systems, using microhydro, solar photovoltaic, small wind, and other indigenous sources, with an estimated capacity of 200 kilowatts (kW) overall to serve the energy needs of about 1,500 households in the Caraga region of Mindanao. The TA is expected to generate the following outputs: (i) renewable energy resource and demand assessment; (ii) pilot renewable energy projects; (iii) productive use of renewable energy; (iv) establishment of CBOs and revolving fund for livelihood enhancement; and (v) knowledge dissemination.

The TA is estimated to cost $2,400,000 of which $2,000,000 will be financed on a grant basis, by the Asian Clean Energy Fund (established by the Government of Japan) under the Clean Energy Financing Partnership Facility, and administered by ADB. The NEA will be the executing agency for the TA and will collaborate closely with Department of energy, the local electric cooperatives ,and other relevant government agencies. The NEA will assign a project coordinator before contract negotiations and counterpart staff to work with the consultants.

The TA will be implemented over 30 months, beginning 1 March 2011.

Project Rationale and Linkage to Country/Regional Strategy

Although the Philippines achieved 100% of rural electrification in 2009 at the barangay level, there are still about 4.3 million still unenergized households all over the country, particularly in Mindanao. The Government's target is to achieve 90% electrification at household level mostly through development renewable energy by 2017. Development of renewable energy is an effective way to address indigenous peoples' poverty.

ADB's Country Partnership and Strategy 2005-2007, which has been extended to 2010, emphasizes support for removing infrastructure bottlenecks in power, transport and agriculture sectors to increase competitiveness of the country. In particular, supply of secure, affordable electricity is key to promote sustainable growth in the country. ADB's country strategy recognizes the linkage between rural development and access to electricity. The poorest households and communities in the country are found in the far-flung, unelectrified sitios particularly in Mindanao where the poverty incidence is highest. The proposed PATA is part of ADB's Energy for All Initiative to develop innovative approaches to deliver access to affordable, modern energy for the poor and scaling up renewable energy. Access to energy underpins ADB's poverty alleviation mandate and long-term Strategy 2020 objectives of inclusive and environmentally sustainable growth. Maximizing access to energy is one of three pillars of ADB's 2009 Energy Policy, which aims to help ADB's developing member countries (DMCs) provide reliable, adequate, and affordable energy for inclusive growth in a socially, economically, and environmentally sustainable way.

The recently completed energy sector assessment, strategy and roadmap (ASR) has clearly identified Mindanao as a geographical focus for ADB assistance given the substantial progress in the power sector reforms that have attracted private sector investments in Luzon and Visayas. Moreover, the current power shortages experienced in Mindanao call for urgent actions in developing sustainable renewable energy resources to diversify the energy mix meet the growing demand in Mindanao.

The formulation and design of the proposed PATA has benefited from the lessons learnt form the recently completed Renewable Energy for Negros Occidental Project financed by JFPR particularly in terms of livelihood activities and revolving fund operated by the Community Based Organizations (CBOs) established under the Project. The CBOs can play an active role in the implementation of the project and will ensure long term sustainable benefits of the renewable energy facilities. In this context, gender and indigenous people issues will be identified and addressed under the PATA. Moreover, PATA will formulate appropriate business models that will involve public and private partnership (PPP) for developing renewable energy in Mindanao. In this regard, it is noted that the cost of the renewable energy and the affordability to consumers will be a key issue for the design of business model and successful PPP.

Impact

Business models developed for scale-up of renewable energy projects in the Philippines.

Project Outcome

Description of Outcome

Households in Caraga, Mindanao provided with affordable renewable energy.

Progress Toward Outcome
Completion of TA Consultant's report on rapid assessment of RE resources. Aside from Caraga Region, Davao Region was included in the assessment. Micro hydro power was used for livelihood development of community based organizations in Don Marcelino Municipality, Davao del Sur and Bayugan City, Agusan del Sur.

Implementation Progress

Description of Project Outputs

1. Rapid assessment of RE resources, review of RE technologies and models, existing infratructure and socioeconomic profiles of target areas.

2. Design and installation of at least 6 RE projets with aggregated capacity of 200 kW with local spare parts.

3. Productive use of RE based electricity.

4. Revolving fund is set up.

5. Investment plan and preparatory work for replication and scaling up RE development for other areas is completed.

6. Development of Knowledge kit.

Status of Implementation Progress (Outputs, Activities, and Issues)

All TA activities were completed on 30 September 2015 and all outputs has been delivered. The TA was closed properly in December 2015.

Activity 1 - Initial project scoping was conducted by TA consultants and presented during the TA Inception Workshop in November 2011. Location covered are Davao and CARAGA region. TA Consultants' report on initial project scoping for rapid assessment of RE resource, review of RE technology and models, existing infrastructure and socioeconomic profiles of target area was submitted in Feb 2012.

Activity 2 - Technical feasibility study, engineering designs of three Micro Hydropower plants (MHPPs), financial ananlysis, and the capacity building assessment for the community livelihood development were completed in September 2013. Due to limitation of budget for MHPPs, only two project sites were selected to pilot MHPPs where are (i) Dalupan Barangay, Don Marcelino Municipality, Davao Del Sur and (ii) Getsemane Barangay, Bayugan City, Augusan Del Sur in Mindanao.

The procurement of MHPPs was completed in Setember 2014. Inaugulation ceremony for Dalupan MHPP (25kw) was held on 28 July 2015 and installation of Getsemane MHPP (30kw) was completed in August 2015. The MHPPs were turned over to CBOs properly in September 2015.

Activity 3-4: The consulting firm was engaged in January 2014. The stakeholder's meeting was held in March 2014 for facilitating the project implementation. NGO/Micro financing institutes were engaged in August 2014 for capacity building for CBOs, piloting revolving funds and initial operation of revolving funds for the livelihood development. Three CBOs were estabilished in Dalupan, Don Marcelino Municipality, Davao Del Sur, Getsemane and St. Nino, Bayugan City, Agusan Del Sur. The revolving funds were set up and have been piloting livelihood developments using revolving funds for three CBOs managed by NGO/Micro financing institutes. The revolving funds were turned over to CBOs in September 2015.

Activity 5-6: A knowledge kit has been developed.

The all activities has been completed in September 2015.

Geographical Location

Summary of Environmental and Social Aspects

Environmental Aspects
Involuntary Resettlement
Indigenous Peoples

Stakeholder Communication, Participation, and Consultation

During Project Design
During Project Implementation

Business Opportunities

Consulting Services
22 person-months international and 30 person months national consulting services

Contact

Responsible ADB Officer
Jung, Choon Sik
Responsible ADB Department
Southeast Asia Department
Responsible ADB Division
Energy Division, SERD
Executing Agencies
National Electrification Administration

Timetable

Concept Clearance
20 Aug 2010
Fact Finding
19 Oct 2010 to 22 Oct 2010
MRM
-
Approval
16 Feb 2011
Last Review Mission
-
PDS Creation Date
19 Jul 2010
Last PDS Update
13 Jan 2016

Funding

TA 7781-PHI

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
16 Feb 2011 27 Apr 2011 27 Apr 2011 31 Aug 2013 30 Sep 2015 23 Dec 2015
Financing Plan/TA Utilization
ADB Cofinancing Counterpart Total
Gov Beneficiaries Project Sponsor Others
0.00 2,000,000.00 400,000.00 0.00 0.00 0.00 2,400,000.00
Cumulative Disbursements
Date Amount
17 Jun 2022 1,437,459.61

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.


Evaluation Documents See also: Independent Evaluation

None currently available.


Related Publications

Title Document Type Document Date
Maximizing Access to Energy for the Poor in Developing Asia Brochures and Flyers Dec 2013

The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

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Tenders

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Contracts Awarded

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Procurement Plan

None currently available.