SONA 2022 PROMISE TRACKER: ENERGY AND ENVIRONMENT

At present, our demand for energy far exceeds our reliable supply. We must increase the level of energy production. We must look at every possible option that would be appropriate for the Philippine situation. There is some room to expand our present power supply through existing power sources, but this is only to a very limited extent. We must build new power plants. We must take advantage of all the best technology that is now available, especially in the areas of renewable energy.

• Power production in the country increased from 106,115 gigawatt hours (GWh) in 2021 to 111,516 GWh by the end of 2022, based on the latest power statistics report of the Department of Energy (DOE).
• Electricity still relies on coal power plants, which generated 59.57% or 66,430 GWh of the total 111,516 GWh consumed in 2022.
• Two renewable energy resources saw a decrease in electricity generation in 2022.
  • Power production in geothermal power plants decreased to 10,425 GWh from 10,681 GWh in 2021.
  • Wind power production was down to 1,030 GWh from 1,270 GWh in 2021.
• The DOE reports the construction of 113 private sector-initiated power plants, 48 of which are set for commercial operations starting this year.
  • 74 private-funded power plants will be constructed in Luzon, 16 in Visayas, and 23 in Mindanao.
• Majority of these greenlighted projects are 24 solar power plants in Luzon, five geothermal power plants in Visayas, and 16 hydroelectric power plants in Mindanao.

The technology on renewable energy is progressing rapidly. And many of these technologies are appropriate for the Philippines. We have already begun windmill power. We are now expanding very quickly our solar power production.

• The gross power generation from solar power plants increased by the end of 2022 to 1,822 GWh compared to 1,470 GWh in 2021, based on the 2023 midyear energy report of the DOE.
• The department awarded 291 contracts for the construction of solar power farms all over the country, 216 of which are in Luzon, 46 in Visayas, and 29 in Mindanao.
• Of these, 22% or 66 power farms have started commercial operation as of March 2023. These include 40 in Luzon, 20 in the Visayas and six in Mindanao.
• Solar Philippines is on-track in building the largest solar farm in the world, according to reports. It aims to provide 4 GW of solar electricity from its 3,500-hectare solar farms in Nueva Ecija and Bulacan.

In the interim, natural gas will hold the key. We will provide investment incentives by clarifying the uncertain policy in upstream gas, particularly in the area close to Malampaya. This requires clarification of the processes and review of service contracts policy.

• Energy Secretary Raphael Lotilla said  the government is reviewing policies on the investment perks for the exploration of natural gas resources in the country, also known as upstream gas incentives.
• The review is eyeing amendments to the 50-year-old PD 87 or the Oil Exploration and Development Act ,which is said to have hindered investments in the industry because of the 60-40% net earnings sharing between the government and a service contractor. For this reason, DOE announced the creation of a technical group to review PD 87.
• While Marcos renewed the Malampaya gas field contract for another 15 years, the government will still hold a 60-40 split in the net sale of oil in the area. Lotilla explained that this is “to allow the contractor some leeway in pursuing new opportunities” in and around the depleting resources of the Malampaya gas field.
• One bill, proposing income tax incentives for petroleum contractors, is pending in the Senate Committees on Energy and Ways and Means. No similar bill has been filed in the House.

We will comply of course with the International Atomic Energy Agency (IAEA) regulations for nuclear power plants as they have been strengthened after Fukushima. In the area of nuclear power, there have been new technologies developed that allow smaller scale modular nuclear plants and other derivations thereof.

• The Philippine government is in talks with United States-based companies NuScale Power Corp. and Ultra Safe Nuclear Corp. to put up small-scale nuclear power plants in the country.
• It is looking toward harnessing nuclear power as one of the potential solutions in meeting power demand in the country.
• However, small modular reactor technologies, such as those developed by NuScale and Ultra Safe, have been met with criticisms about its safety, financial risks and nuclear waste management.

The use of renewable energy is at the top of our climate agenda. We will increase our use of renewable energy sources such as hydropower, geothermal power, solar, and wind.

• The use of renewable energy for residential and commercial use in the country has increased in the last two years. The dependable capacity of renewable energy resources reached 24,683 GWh in 2022, based on DOE’s latest power statistics report.
• Power generation from  hydroelectric, biomass, and solar energy sources increased in 2022,  but the share of geothermal and wind resources dipped.
• Geothermal power generation dropped to 10,424 GWh in 2022, from 10,681 GWh in 2021. Wind power generation decreased to 1,029 GWh in 2022, from 1,269 GWh in the prior year.
• In November 2022, the Philippine government clarified that full foreign ownership in the exploration, development and utilization of solar, wind, and ocean energy resources is allowed under RA 9513.
• This aligns with the country’s National Renewable Energy Program to boost renewable energy’s share in the country’s power generation to 35% by 2030 and 50% by 2040.

Geographically, we are a disaster-prone country. Capacity building for our natural disaster resiliency is therefore a must. Investment in science and technology is imperative to enable us to have accurate weather forecasts and on-time disaster alerts.

• The Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) is developing the Multi-hazard Impact-based Forecasting and Early Warning System for the Philippines, also known as the IBFPh Project.
• IBFPh aims to establish a nationwide system of “timely and actionable warning information” to reduce the risk of hazardous impacts of extreme weather events.
• The Green Climate Fund (GCF), a global organization supporting “climate-smart investment opportunities,” is backing the project with $10-million assistance. The Land Bank of the Philippines is also supporting the project.
• GCF approved the project in late 2019, and has been under implementation since December 2021.
• The project began in 2022 in vulnerable barangays in Tuguegarao City, Cagayan; Legazpi City, Albay; Palo, Leyte; and New Bataan, Davao de Oro. The target completion date is April 5, 2027.

We will also look into the precarious fresh water supply situation in the country, especially in our urban areas. Many of our water supply systems date back to the 1950’s, and they must now be rehabilitated and improved.

I have instructed the DENR together with the DPWH, to explore possible partnerships with the private sector to address this crucial situation.

• The Manila Waterworks and Sewerage System held a ceremonial groundbreaking in Norzagaray, Bulacan to kick off the construction of Angat Water Transmission Improvement Project Tunnel No. 5 on May 12. It is part of the Marcos administration’s 194 “high-impact” infrastructure projects.
• The construction of the P3-billion tunnel aims to mitigate water supply interruptions in areas that Angat Dam covers, providing 98% of Metro Manila’s water supply. The project is set for completion by 2024.
• The MWSS is  evaluating a P14-billion proposal from San Miguel Holdings Corp. to develop a water supply project that will tap the Kaliwa River in Tanay, Rizal. This aims to boost water supply for Metro Manila, which currently relies on Angat and Ipo dams.

This seeks to create the Department of Water Resources and adopt the Integrated Water Resource Management (IWRM) as the strategic framework for national water management, policy-making and planning.

• In 2022, 31 bills were filed at the House of Representatives for the creation of a Department of Water Resources. All are pending at the Committee on Government Reorganization.
• But on April 27, Marcos signed Executive Order No. 22, creating the Water Resources Management Office (WRMO) under the supervision of the Department of Energy and Natural Resources (DENR).
• The WRMO will source its initial funds from the appropriated budget of the DENR.
• Aside from managing water demand, distribution, and water infrastructure, the WRMO is mandated to include policies on climate change and disaster risk management in its planning and programs.