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Business

Clean energy

DEMAND AND SUPPLY - Boo Chanco - The Philippine Star

There are two reasons why a country will want to increase the share of clean or renewable energy in its energy mix.

First is the obvious need to make sure Planet Earth remains habitable for future generations. We are likely passing the point of no return, and soon our planet will be  too warm to sustain life as we know it.

The other reason is energy security. The problem with traditional fossil fuels like oil and coal is that only a few countries have a surplus of deposits. That makes us dangerously dependent on politically volatile regions like the Middle East and now, Russia.

There are those who think nuclear energy can be considered clean energy because it doesn’t emit the carbon gasses that heat up our atmosphere. But there is  the problem of safely storing used nuclear fuel rods.

A country’s political leader has the responsibility of weighing the pros and cons. For example, Germany’s Angela Merkel made the surprising decision to phase out nuclear energy, the principal power source of this highly industrialized country.

It was surprising because Merkel is a scientist and would have known nuclear power can be managed well by a technologically savvy country like Germany. But the green lobby was too strong to ignore, and politics dictated her decision.

In hindsight, this decision to dump nuclear energy made Germany more vulnerable to a Russian blackmail on the supply of natural gas. But Germany showed how renewable energy can be harnessed on a large scale basis.

In July 2019, figures published by the Fraunhofer Institute for Solar Energy Systems (ISE) report that renewable energy is for the first time providing more electricity than coal and nuclear power combined in Germany. Solar, wind, biomass and hydroelectric power generates nearly half of the country’s output.

One big reason why Germany’s Merkel was able to make the decision to phase out nuclear power is because it had a good back up.

Germany is part of the European grid and can depend on nuclear energy that France continues to use.

By itself, renewable energy from wind and solar makes electricity grids less reliable. One reason is “intermittency”. Long cloudy days limit solar power output and a battery back-up has its limits, while wind energy depends on weather patterns.

Those who manage power grids want the ability to  control the power output of most power plants by changing the burning rate of fossil fuels, the reaction rate of nuclear reactors, or the water flow rate through hydro dams.

Still, for countries like ours, tapping renewable energy like solar, wind, geothermal, hydro, and tidal power makes us more insulated from the geopolitical realities of oil and coal. It was not easy to tap these resources in the past because technology wasn’t there yet to make these sources reliable and economically competitive with oil and coal.

Now, it is different. Solar power has caught up with the economics and technology concerns of power grid operators. Leandro Leviste, the young solar energy entrepreneur, has been putting up large scale solar power installations that are able to competitively sell to utilities like cost-conscious Meralco.

Convincing the big guys to go clean energy has not been easy. Yet, among the first to totally commit to clean energy is the Lopez Group.

Federico ‘Piki’ Lopez, chairman and CEO of First Philippine Holdings Corp (FPH) and First Gen, admitted that shutting the door on coal power in 2016 meant walking away from an opportunity to make a profit, and this was not easy to explain to shareholders and analysts.

But Piki said their decision to invest in green energy was solidified by the devastation they saw in the wake of Super Typhoon Yolanda in 2013, which he said is part of the ongoing climate crisis.

“Despite the doubters, let me say we never wavered and never once regretted the decision, most especially today,” said Lopez.

That brave decision, among other reasons, made the Management Association of the Philippines (MAP) honor Piki with the Management Man of the Year award… “for passionately pushing for the country’s transition to a low-carbon economy through his various advocacies to proactively address the irreparable damage of climate change.”

Piki picked up from his father, Oscar M. Lopez, who had always been a strong advocate of doing more to avert the destructive effects of climate change in our communities.

The Oscar M. Lopez Center for Climate Change Adaptation and Disaster Risk Management Foundation is working with scientists from the University of the Philippines on climate change issues. OML funded the center in his belief that science and technology have a critical role to play in building climate resilience.

Now, another conglomerate in the energy sector is starting to explore the potential of  renewable energy.

AboitizPower, which is a major operator of coal fired power plants, is now working with the World Bank’s IFC to study  the viability of renewable energy as a source of base load power in the Philippines.

Renewable energy, other than hydro, has never been considered a viable provider of baseload power. But the Aboitizes had been playing around with the possibilities of non-fossil fuels for a while.

The Aboitiz Group has an ongoing experiment in Davao running buses on electricity. Well, Tesla’s been mainstream for a while, but here it is something new. I heard the experiment is going well.

IFC will conduct a joint study with AboitizPower to explore a mix of technologies that can potentially displace fossil fuel-based power sources and reduce CO2 emissions in the Philippines. This supports the nation’s climate goals—35 percent share of renewable energy in the country’s overall generation mix by 2030, and 50 percent by 2040.

Among other things, they will evaluate hybrid solar photovoltaic and energy storage solutions, and the technical and economic viability of generating power from a combination of different renewable sources within the context of the Philippines’ power needs and supply-demand patterns.

Good to see the private sector doing more to harness cleaner and natural resources. This will enable us to diversify our energy mix and improve energy security while also tackling the impact of climate change.

 

 

Boo Chanco’s email address is [email protected]. Follow him on Twitter @boochanco.

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