Clean energy market expands amid demand from `woke` firms
Ten years after the signing of the Renewable Energy Act, the cost of clean power has gone down dramatically prompting a lot of companies to make the switch to renewables.
At the Light Industry and Science Park II in Laguna, Continental Temic manufactures radars, camera systems and braking systems. Starting December 26 this year, their factory will no longer use power produced from coal plants, but will go 100 percent renewable energy or RE.
"I`m promoting it because I am hopeful that other companies would also do it because I think it`s good for the world and it even saves us money," said Glenn Everett, general manager and vice president of Continental Temic Philippines.
First Gen, which produces power from natural gas, geothermal, hydro, wind and solar, won the bidding to supply power to Continental Temic.
"Despite the fact that the lowest price that was offered to them came from a coal plant, they still opted to choose an RE supplier," said Lito Santos, senior vice president of First Gen.
For some companies, the switch to renewables goes beyond getting the cheapest price per kilowatt-hour. It also means catering to the "woke" culture of the younger generation.
"Customers, they are aware more and more as the millennials and new gen come in. These things matter to them," said Carlos Vega, vice president of First Gen and First Philippine Holdings.
GETTING CHEAPER, MORE COMPETITIVE
It doesn`t hurt that the cost of renewable energy has gone down.
MRC Allied, a property firm which recently ventured into renewables, said the cost of solar power has fallen by 90 percent in the last 20 years, making it competitive with non-renewable power sources. Gus Cosio, president of MRC sees a lot of potential in the clean energy sector.
"Recently, our company MRC signed up a rice mill in Nueva Ecija, Cosio said. He estimates the cost of solar power for the rice mill will be around P2/kwh.
The Department of Energy has said that renewables need to be competitive with other energy sources.
"They have to be competitive in efficiency, competitive in affordability," said Energy Secretary Alfonso Cusi during the 2018 Energy Forum. Cusi said the Department has adopted a "technology neutral" stance when it comes to energy sources.
As of 2017 renewables accounted for roughly 34 percent of of the Philippines` total primary energy supply, with natural gas contributing another 5.6 percent.
The Philippines has a peak demand of over 13,000 megawatts and total electricity sales and consumption of 94-thousand-370 gigawatt hours [per year?].
Total installed renewable energy is 7,158 megawatts or roughly 30.2 percent of the total. Coal is still the leading source of power for grid and off-grid, or 37.3 percent of the total.
Advocates say RE could play an even bigger role for power generation in the Philippines if the government can implement properly the renewable energy law.
"With the delayed implementation of mechanisms provided by the 10-year old Renewable Energy Law, the Philippines has been left out in the global trend of falling electricity prices due to the shift towards renewable energy," said Gerry Arances, executive director and convenor of the Center for Energy, Ecology and Development.
CUSTOMERS WANT IT
Santos said it took at least 5 years of discussions before First Gen secured contracts to provide renewable energy to local companies that are now known as early adopters. One of them was food giant RFM.
Now more organizations want to make the switch.
Central Luzon State University in Nueva Ecija is tapping into renewable energy as part of its mission and vision to pursue sustainable solutions.
Unilever Philippines meanwhile has just renewed its contract with First Gen. Unilever is part of the so-called "RE 100," a list of 100 of the world`s biggest companies, which include Ikea, Coca-Cola, the BMW Group and Apple.
In the Philippines, semiconductor firm Analog Devices has also embraced the use of renewable energy.
Vega said in the case of Analog Devices, both the company`s customers and its employees wanted it to go renewable.
"It`s part of the applicants` criteria to join the workforce, because they`re socially and environmentally responsible," Vega said.
Vega meanwhile cleared misconceptions about the reliability of renewables. Some contend renewable energy plants only work if the sun is shining or the wind is blowing.
The key though, Vega, is in the portfolio mix.
"We know hydro is not available 24 hours. Geothermal is, but even geothermal would have to undergo maintenance. So when we offer our RE packaged to these customers, we would always say that when one RE plant is down, another RE plant would serve their requirement."
For Everett, it`s only a matter of time before concern for people, planet and profit come together and firms get to do business while doing goo
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