Game-changers in solar power industry

Despite the acknowledged benefits accruing from the commercial exploitation of the sun’s energy through the installation of photovoltaic (PV) solar panels, solar power continues to be a pipe dream for countries like the Philippines which has abundant supply of this renewable energy.

But lately, some experts are seeing changes in the market place, and in fact are fearlessly predicting an earnest start to the adoption of solar energy production and use, not just in remote areas not reached by the traditional fossil-based electricity companies, but even in Metro Manila.

Energy expert overview

A reader, who is a certified UNIDO/DOE energy management expert, sent his comments on this issue. Here’s what he says:

“The worldwide challenge to the once mighty monolithic electricity structure has gained serious momentum over the last two decades, sparked by Margaret Thatcher’s deregulation of the UK electricity supply industry in 1990.

“The economy of scope and scale which the traditional centralized generation-transmission-distribution set-up depended on has been put to test in the face of pressures from governments and the general public on the gut-level issues of open competition, environment protection, service level, and cost affordability.

“With improved access to information and communication technology, the public and their elected political representatives have become increasingly aware of the atmospheric degradation and resulting climate change from greenhouse gases of traditional hydrocarbon fuel combustion that power most centralized electricity generation systems.

Anxious consumers

“Electricity consumers and businesses alike have likewise grown increasingly anxious of escalating electricity cost (due to unabated oil price increases) and the specter of electricity outages (due to aging infrastructure and equipment).

“In this scenario, it is not difficult to understand the growing adaptation of distributed and decentralized electricity generation as a quick and easy path to liberation from the clutches of the centralized and monopolistic electricity structure.

“Here at home, having an embedded electricity generation on the electricity consumer’s premises enables the avoidance of cost of transmission and distribution which accounts for about a third of the electricity bill.

Enterprising entities

“The retail competition and open access provision in the Electric Power Industry Reform Act of 2001 (EPIRA) and the green option in the Renewable Energy Act of 2008 (REA) provide the opening to enterprising entities and electricity consumers to exploit this particular opportunity.

“The cost of solar PV-generated electricity, for example, has approached “generation parity,” i.e., current generation cost of independent power purchase and supply sources.

“Since the solar PV system would be located at the consumer’s premises, the transmission and distribution costs of centralized generators are avoided. Moreover, both EPIRA and REA essentially take away the value added tax (VAT), i.e., being at zero-rated VAT contained in the electricity bill for electricity supplied from renewable energy sources.

“From the aforementioned, it’s very likely some entrepreneurial neighborhood may think of generating their own solar PV electricity for their daytime electricity. And some technological innovation on electricity storage may supply their nighttime electricity consumption as well, not to mention as a hedge against unwanted electricity outages.

“For distribution utilities and electric coops, it is worth their while to tap into decentralized generation as an economic source for supplying their customers who may not be prepared to fork out the initial capital cost of a solar PV system.

“The stage is set for the greening and decentralization of our electricity system towards a healthier and more competitive Philippines.”

LED lights

I’d like to add that light emitting diodes (LED) as the preferred choice of consumers nowadays for their home or office lighting is also instrumental in bringing solar energy to a new era.

There are now new applications that have become viable, like the use of solar power to light LEDs in the Boni underground tunnel. These days, this motor vehicle underpass is well lit, thanks to a project by the Department of Energy (DOE) and the Asian Development Bank.

This undertaking is supposed to cut by half the P500,000-a-year bill from the previous use of incandescent light bulbs. Definitely, not a small amount especially with the other plus factors like longer life of LEDs and the reduced heat emission of the lighting fixtures.

Solar for schools

One other channel that the DOE is now pursuing to encourage the use of solar energy is via schools. Recently, the Energy department announced that it was piloting the installation of solar energy panels in three private schools as well as the Manuel L. Quezon University in Metro Manila.

If successful, more schools are expected to join the “solar rooftop project” not only in Metro Manila, but also in provinces that have a big population of schools and universities.

The DOE is bullish about this because the solar panels will be installed and maintained by third party suppliers at no cost to the participating schools or universities. The users will just need to pay for the electricity generated by the solar panels at a much cheaper rate than what Meralco is currently charging.

The idea of solar power for schools is not new. Many big universities in the US like Yale, Johns Hopkins, and George Washington have installed solar panels on their rooftops, and the numbers are increasing.

Schools are an ideal consumer of solar-powered electricity since the peak usage is during the day when the students are attending classes. At night, the campus winds down with students moving back to their homes.

With many schools looking for ways of cutting down on expenses, solar presents a viable alternative. At the same time, this serves as a demonstration for students of actual ways by which society is exploring to cope with the challenges of environmental degradation and global warming.

May there be indeed a brighter and greener tomorrow for solar energy.

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Should you wish to share any insights, write me at Link Edge, 25th Floor, 139 Corporate Center, Valero Street, Salcedo Village, 1227 Makati City. Or e-mail me at [email protected]. For a compilation of previous articles, visit www.BizlinksPhilippines.net.