Department of Energy eyes multilateral financial institutions' support for energy projects

MANILA, Philippines - The Department of Energy (DOE) plans to tap more fundings from multilateral financial institutions to support the government’s energy efficiency projects.

“There have been initiatives from both the Asian Development Bank and World Bank,” Energy Secretary Angelo Reyes said, adding that they will try to finalize the discussions soon to boost the country’s goal of promoting a more efficient way of using electricity.

“We may need the help of funding institutions like the World Bank and ADB on these matters,” he said.

Reyes said there have been numerous initiatives from multilateral lenders especially in renewable energy-related projects.

“This is the thrust of the international funding agencies, to fund noble energy projects and that is very, very encouraging,” he said.

He said they also expect other financial institutions to acknowledge the importance of renewable energy (RE) development.

“RE is very, very attractive and very hard to resist. So, we do anticipate investors to come in as soon as this credit crunch eases, I think that’s the only thing holding them back,” he said.

Reyes said he is also optimistic investors would see opportunities in pouring in money in RE development.

“Despite this credit crunch, there are still a lot of people coming as they see how they incentivize the industry,” he said.

Recently, the DOE received a $31.1-million grant from ADB for the Philippine Energy Efficiency Project (PEEP).

PEEP is a by-product of the 2008 Philippine Energy Summit that aims to replace 13 million incandescent bulbs still in use in the country with compact flourescent lamps (CFLs).

This project, with an end of achieving reduced peak demand of 450 megawatts (MW) and reduced oil imports worth $120 million each year, will also result to deferred power generation of 1,300 MW or $300 million each year.

The PEEP will likewise lead to clean development mechanism (CDM) revenues of about $10 million for 2010-2012 under the Kyoto Protocol.

According to Reyes, it will also create an energy efficient market which is the most effective way to reduce the carbon footprint, stretch supplies and improve energy security.

The project, he said, aims to expand the testing laboratory capacity and establish a mercury waste management plant for fluorescent lighting.

It will also pave the way for the implementation of a certification scheme for energy-efficient buildings.

Reyes said under the PEEP, they will carry out development and implementation of a communication and social mobilization program.

The Asian Clean Energy Fund under the Clean Energy Financing Partnership Facility will provide grant co-financing equivalent to $1.5 million.