Civil society and green groups groups are blocking the way for electric tricycles, saying the $101-million loan funds for the technology were diverted from the more urgent solar generation project.
This was the latest blow to efforts to make the Philippines greener and less dependent on fossil fuels, said environmental groups, who have protested the government's move to reduce the allocation capacity for renewable energy.
Flawed financing scheme
Greenpeace Southeast Asia and the Freedom From Debt Coalition (FFDC) on Friday hit the Manila-based Asian Development Bank (ADB) for diverting the loan without consultation with stakeholders. They also demanded that the Trust Fund Committee of the Washington DC-based Clean Technology Fund to "reject the ADB's proposal”.
"Subsidies for E-trikes are not needed, especially not for a project like this with a flawed design. Financing for renewable energy and feed-in-tariffs are. The ADB has no business diverting money away from country priorities," said Greenpeace Southeast Asia campaigner Francis de la Cruz in a statement.
"There have been zero consultations on the fund diversion with the renewable energy industry in the country. This is outrageous," de la Cruz said.
E-trikes: The bigger picture
The ADB has started to pilot the e-trike project as early as 2010 to solve the nation's growing transportation demands in a way that is both cost-conscious and environmentally responsible. The project, which was first tried out in Metro Manila, will roll out this year.
According to the ADB, electric vehicles are highly efficient, using up to 75 percent of their energy to power the vehicle versus only 20 percent used in most internal combustion engines. The e-trike produces no noise and zero tailpipe emissions and can be charged at night during off-peak electricity hours.
But green groups were not impressed by the plan. They criticized the eTrikes project of the ADB for the absence of disposal, after-sales services and replacement programs in the project design. The ADB intends to utilize new electric vehicle technologies, particularly lithium ion batteries, in its eTrikes. Greenpeace and FDC said lithium-ion batteries were recalled in the US recently for safety and maintenance issues.
Last November, the ADB and the DOE presented the Revised Clean Technology Fund Investment Plan for the Philippines in Washington, DC. In 2009, $125 million was allocated to renewable energy and energy efficiency program of the country. Under the revised plan, $24 million will be allocated for energy efficiency and $101 million for E-trikes.
It appeared now that the bulk of the money will go to the electric tricycles, the groups said. In a letter to the FDC last December, the Department of Energy said the fund diversion was initiated by the ADB.
According to the DOE letter, "The funding is being shifted by ADB from one project to another project which they feel is much more economical and has greater impact and more transformational."
'Arrogant pet project'?
"The diversion of $101 million to what seems to be a pet project of arrogant ADB officials evades more pressing issues involving renewable energy in the country," said FDC Power Coordinator Job Bordamonte.
"Instead of extending subsidized credit to eTrike manufacturers, the money should be used for innovative financing programs that dramatically lower the transition costs involved in shifting to renewable energy in the Philippines, which already has one of the highest power rates in the world," Bordamante said.
The Trust Fund Committe of the Clean Technology Fund is set to deliberate and approve the $101-million Revised CTF Investment Plan for the Philippines on 1 February in Washington, DC.
The adjustment of the funding coincided with the reduction in the government's allocation for various renewable energy projects, which environmental groups said was another blow to the clean energy.
Loss to solar energy sector
Greenpeace said the government cut down the allotment for solar energy sector to 50 megawatts from the original proposal of 150 MW. It brought down the target for wind power to 200 MW from the proposed 220 MW.
Officials of environmental organizations like Greenpeace and the World Wide Fund for Nature – Philippines (WWF) expressed dismay at the recent developments, saying it appeared as if the Aquino government was only paying lip service to the renewable energy industry.
Mark Dia, country representative of Greenpeace and a member of the National Renewable Energy Board, was frustrated at the changes in the capacity allotment. “We are very unhappy with that,” Dia said in a recent interview. “We have been importing fossil fuels. It's going to create a lot of problems for us in the future,” he said.
Greenpeace and WWF have noted that, unlike fossil fuels, renewable energy sources like the sun and wind are abundant in the Philippines. Coal and oil, on the other hand, have to be imported and have negative impacts on people and the environment.
Independence from oil and coal
Naderev Saño, a former NREB member and WWF official, said the Philippines should start to wean away from “dirty” energy sources, noting that oil and coal are finite resources.
“Every year, the price of coal is going up. Honestly, I don't know why they did that,” he said, referring to the NREB's reduction of targets.
He and Dia also pointed out that the coal from overseas - mainly Australia, China, and Indonesia - will have to be transported to the Philippines using fossil fuels.
“We would end up importing and importing. We will be at the mercy of foreign oil,” Saño said.
No moving forward?
Dia urged the Energy Regulatory Commission to decide on the feed-in tariff issue. “Because of that, all the other sectors – wind power, biomass, solar, hydro – could not move forward,” he said.
Dia dismissed allegations that the inclusion of renewable energy in the national grid would lead to a rate increase of P18 per kilowatt hour, thanks to the feed-in tariffs, a compensation mechanism for renewable energy companies.
He noted that based on their computation, feed-in tariff would only add 20 centavos per kwh to the household bill. “Meralco raises 50 cents per kwh, but nobody is complaining,” he said.
Dia said the government should take note of what is happening in the Middle East as it affects the local price of fuels. Recently, energy analysts warned that price of oil could soar due to Iran's blockade of the Strait of Hormuz, an important shipping route.
“This is a portent of things to come,” Dia said. — TJD, GMA News