26 April 2010 in businessmirror.com.ph
‘Green’ laws perk up investor interest
Local and foreign investors expect new business opportunities to emerge in the Philippines as the country encourages the more energetic implementation of its “green” laws to develop environment-friendly technology not just because it is good for nature, but because it is also good for the bottom line.
For investors, a low carbon economy is attainable through renewable-energy sources. They said the future potential for such investments is fairly good for several renewable technologies—from small hydro, geothermal, biofuels, solar, wind and biomass.
David de Montaigne, president of British project-development firm Global Green Power Corp. (GGPC), said that in order to have a successful shift to a “green” economy in the Philippines, there is a need to have very careful planning to select the correct technologies and to place the correct and fair incentives to encourage investment.
“The Philippines is by far the most attractive country to invest within Asia. The investment climate through the Renewable Energy Act, ready supply of very talented engineers and experts, English spoken, and vast availability of biomass has attracted us to invest in the country,” said de Montaigne.
GGPC develops biomass renewable-energy power plants using sustainable biomass
resources such as agricultural crop and food- processing waste. It has targeted the Philippines for the construction and operation of biomass power-plant projects of between 17.5 to 35 megawatts (mW).
It now has three biomass-power projects expected to be fully operational by 2012 in Nueva Ecija, Iloilo and Bukidnon on an investment of about $192 million.
De Montaigne said the life-cycle costs of biomass-power plants are much less
expensive than fossil-fuel power plants if one takes into consideration the socioeconomic impacts it brings—use of local, indigenous, renewable fuel resources; delivery of an estimated P200 million in the first year of operation and P9 billion over 25 yearsper 17.5-MW plant to the local farming and host community through purchase of agriwaste for fuel and associated ancillary services such as transport and operations; and provision of base-load electricity to the Philippines like Panay Island, which suffered over 1,000 blackouts in 2008, making local economic development almost impossible.
In general, he said, all renewable energy solutions are more expensive than fossil fuel technology, “that is why a feed-in tariff is required to stimulate investment into the Philippines. Otherwise the new technology would not be developed. GGPC is a private company and so the project must be profitable to undertake, otherwise banks would not participate in the projects.”
De Montaigne said there is an urgent need to reduce consumption of power in tandem with developing renewable energy in developing countries to alleviate poverty and dispose of environmentally damaging agricultural waste.
A need for a global adjustment in the financial system that would facilitate more development in poorer countries is also urgently needed, he added.