IMPOSING levies on the carbon content of fuels is far from coming into fruition, Energy Secretary Alfonso G. Cusi said adding that a push on the imposition of carbon tax would “make the Philippines uncompetitive.”
During Tuesday’s international virtual conference of Asia Pacific Energy Week, Cusi went on to say that the country is “a victim of climate change and what I am asking is climate justice.”
The chief of the Department of Energy (DOE) asked for “support” so the country can properly transition to renewable sources of energy and veer away from fossil fuels.
A carbon tax is a form of carbon pricing. Carbon is present in every hydrocarbon fuel, such as coal, petroleum and natural gas; it is released as carbon dioxide (CO2) when burned. Renewable energy (RE) sources, on the other hand, do not convert hydrocarbons to CO2.
“When I assumed this position, we were short of capacity,” Cusi said noting that at that time, 2016 to 2017, “I said I will source power from any source.”
“So, we adopted a technology-neutral policy. Up to this moment, we still want to build capacity,” the DOE official explained. “Carbon tax, at this moment, is not… we’re not just ready for that. Burdening our generation with carbon tax will only make the country uncompetitive.”
“We are not ready for carbon tax,” replied Cusi when asked for his comment on carbon-tax imposition in the Philippines.
Coal still dominates the country’s power generation mix at 49 percent; followed by RE, 26 percent; gas, 21 percent; and, the remaining from other sources.
“So, we’re trying to develop our indigenous sources to ensure our energy security and make the cost affordable. Our energy landscape is at the hands of the private sector,” Cusi noted.
To promote renewables, the government will establish a Green Energy Option Program (GEOP) that gives end-users the option to source their energy requirements from renewable energy.
The agency is targeting to start bidding out the supply of RE by middle of this year. Under the DOE’s green energy auction, qualified RE developers can offer to supply a specified volume of electricity generated from their facilities.
“We developed other ways to promote RE. One of them is the GEOP,” Cusi said. “We are also pushing for nuclear power plant. Looking at the future, we have signed an MOU [memorandum of understanding] with an Australian company to develop hydrogen to be used for power generation. We are also working with Japan for electrolysis type of hydrogen power generation.”
The DOE chief is hoping to be able to utilize hydrogen as fuel for electric vehicles and as part of the country’s future energy mix.
“I have often said that there could be a lot of potential for hydrogen for the local industry given that it is seen as the fuel of the future.”
Also, the country now allows full foreign ownership in large-scale geothermal projects, with an initial investment cost of $50 million.
These efforts are meant to increase the country’s RE portfolio to 40,000 megawatts in the future, the DOE chief said.
Cusi called on investors, particularly those advocating clean energy, to pursue RE projects in the country.
“We would like to invite investors to locate in the Philippines. Our problem is our energy tariff. To make our country competitive, we have to bring down that and have to find a balance,” he said.
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