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Sustaining development, power, and carbon footprints

by August 20, 2017 General

The Paris climate accord, adopted in 2015, in many ways represents the culmination of a global effort to address climate change. Under the deal, each of the 196 countries had to declare its plans and targets in curbing greenhouse gas emissions by 2020.

For its part, the Philippines ratified the agreement early this year and pledged to reduce by 70 percent its carbon emissions by 2030. This is despite the fact that the country contributes very little to global warming and is “blameless in stratosphere” with a carbon footprint that is dwarfed by industrial giants like the United States and China.

In 2014, the country’s emissions totaled just one metric ton per capita. For perspective, that’s even less than the emissions of countries like Congo or Angola and is considerably microscopic vis-à-vis Singapore, which emitted 8.6 metric tons. Moreover, at 35 percent, the ratio of renewables in the country’s energy mix is already higher than most of the world’s top polluters.

Industry, in particular, has always bemoaned decisions that demonstrate minimal understanding of this fundamental reality. While there should be no debate on the need for all industries to use the most efficient technologies that minimize pollution, the loud propaganda of some environmentalists at times renders the discussion in black and white: that is, between saving the planet versus development.

This is clearest in the case of the power sector. Despite government projections that the country’s growth in the next 10, 20 years hinges on stable and affordable electricity, some groups are single-minded in blocking key development projects like urgently needed coal-fed power plants.

This opposition not only ignores the profile of the Philippines as an insignificant greenhouse gas emitter, it also overlooks existing safeguards and legislation, such as environmental laws and the Clean Air Act, as well as newly available technologies that exceed compliance to emissions standards. As in many issues in the Philippines, the issue is more the need for better enforcements of regulations than any blatantly political intervention.

Among the long-term strategic directions identified by the Department of Energy, foremost are “Ensure energy security” and “Expand energy access.” These were revealed in a recent forum organized by think tank Stratbase ADR Institute (ADRi) and consumer group Citizen Watch.

Called “Energizing Economic Growth: The Role of Energy in the Philippine Economy,” the discussion put into proper perspective the current power supply situation and growing energy demand in the context of the government’s ambitious development agenda. In particular, economist Raul Fabella stressed the crucial role of the manufacturing sector in this growth and the strategic impact of adequate baseload capacity.

The relationship between manufacturing growth and poverty reduction had long been established. A larger manufacturing sector results in higher poverty reduction than a larger services sector, the current profile of the domestic economy. The cases of China and, more recently, Vietnam attest to this credible development trajectory, a route that the Philippines can be on its way to following.

Thus, while being party to the Paris climate accord, there is a need to clarify the conditionalities that go with the idealistic 70 percent reduction. Because a robust manufacturing sector inevitably requires a reliable energy supply, a key recommendation presented in the paper by Dr. Fabella, is to focus more on demand-side management, such as prioritizing less carbon-dependent modes of transportation and increasing the efficiency of energy use.

To lower the price of power, shift additional charges, like the Feed-in-Tariff, from manufacturing and industry toward services and the state treasury. If possible, negotiate for the FIT bill to be bankrolled by the global climate fund. Finally, create a truly single market for electricity in the Philippines and, instead of continuous intervention from the government, let the market be the guide on the suitable fuel mix.

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