Opportunities and Challenges for Eastern Visayas · Support the Eastern Visayas Energy Development...

Climate Change, Industrial

Policy and Sustainable Energy: Opportunities and Challenges for

Eastern Visayas

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Inclusive Local Development: What Role for Sustainable

Industrial Policy?

August 10, 2017 | Visayas State University

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I. The Global Agenda: Industries, Climate

Action, and Sustainable Energy

II. Overview of the National and Regional

Plans

III. In Focus: Energy and Power Sector

Presentation Outline

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Sustainable Development Goals

The 2030 Agenda

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There remains a challenge in attaining and

sustaining a robust economic growth…

3.0 2.1

(6.8)

4.6

(2.4)

4.6

12.4

(10.0)

(5.0)

0.0

5.0

10.0

15.0

2010 2011 2012 2013 2014 2015 2016

Figure 1. Economic Growth Rate, Eastern Visayas, 2010-2016

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…especially for the agriculture and industry sectors

(25.0)

(20.0)

(15.0)

(10.0)

(5.0)

0.0

5.0

10.0

15.0

20.0

25.0

2010 2011 2012 2013 2014 2015 2016

AHFF Industry Services

Figure 2. Growth Rate of Economic Sectors, Eastern Visayas, 2010-2016

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In particular, the manufacturing subsector’s growth

has been erratic

Table 1. Growth Rate of Industry Subsectors, Eastern Visayas, 2010-2016

Industry Subsectors 2010 2011 2012 2013 2014 2015 2016

Mining and Quarrying 26.6 116.5 7.6 (24.3) 25.6 16.8 3.2

Manufacturing (1.7) 6.9 (40.4) 33.5 (16.0) (3.0) 19.6

Construction 5.1 (17.2) 29.0 9.8 27.4 12.3 44.5

Electricity, Gas, and Water

Supply 0.6 (0.1) 7.7 (6.5) (0.0) 10.7 2.1

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In particular, the manufacturing subsector’s growth

has been erratic

Table 1. Growth Rate of Industry Subsectors, Eastern Visayas, 2010-2016

Industry Subsectors 2010 2011 2012 2013 2014 2015 2016

Mining and Quarrying 26.6 116.5 7.6 (24.3) 25.6 16.8 3.2

Manufacturing (1.7) 6.9 (40.4) 33.5 (16.0) (3.0) 19.6

Construction 5.1 (17.2) 29.0 9.8 27.4 12.3 44.5

Electricity, Gas, and Water

Supply 0.6 (0.1) 7.7 (6.5) (0.0) 10.7 2.1

Impact of Yolanda Fire incident

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Vulnerability reduction is an integral part of

development

Philippines ranks

3rd among

countries with the

highest disaster

risks in the world

(World Risk Report

2016)

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development

The country’s

average

temperature is

projected to be

warmer by mid-

21st century

Figure 1. Annual Mean Temperature

Source: DOST-PAGASA

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development

30 provinces are

exposed to

multiple hazards

(Category 3

provinces)

Source: PDP Midterm Update

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development

Eastern Visayas

is highly

vulnerable to

disasters

Philippine Development Plan

(PDP) 2017-2022

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Eastern Visayas Regional

Development Plan 2017-2022

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16

Strategic Framework

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Medium-term Strategies Towards an Enabling and

Supportive Macroeconomic Environment

• Adopt economic dispersion through regional agglomeration

• Ramp up rural industrialization

• Modernize agriculture and fisheries sector

• Generate job-creating investments

• Improve the business climate

• Accelerate implementation of infrastructure programs and

projects

• Adopt green growth for sustainable development

• Enhance disaster risk reduction and climate change adaptation

and management

• Sustain investment on human capital

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Medium-term Key Priority Thrusts

Agriculture and Fisheries

Manufacturing Tourism

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Expected Drivers of Growth

Demand Side

• Household consumption: remittance

inflows, strong consumer confidence,

low inflation rate

• Government spending: public

construction, public administration,

reconstruction activities

• Investment: manufacturing

resurgence program, public

infrastructure projects

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Expected Drivers of Growth

Supply Side

• Resurgence of agriculture and fishery

• Boost in construction industry from

aggressive government spending for

infrastructure (Golden Age of Infrastructure)

• Influx in tourists

• Expansion in retail trade

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Risks and Uncertainties

• Weather disturbances

• Logistics bottlenecks

• Delays in government infrastructure and

reconstruction projects

• Socio-political uncertainties

In focus: Energy and

Power Sector

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Industrial Policy?


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PDP 2017-2022: Energy and Power Sector

• Support the required massive investments in the energy

and power sector

• Encourage competition to drive down electricity costs

• Pursue the development of the natural gas industry

• Ensure that the needed transmission facilities are

implemented on time

• Prioritize provision of electricity services to unelectrified

areas

• Improve energy efficiency

Largest

geothermal

energy producer

of the Philippines

Capacity of around 700 megawatts

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CHALLENGES IN THE ENERGY AND POWER

SECTOR OF THE REGION:

• Despite being the largest producer of geothermal energy in the

country, the region is beset with high cost of electricity

Table 2. Average Power Rates by Region, as of September 2016 (in PhP/kWh)

Source: Eastern Visayas Regional Development Plan (RDP) 2017-2022

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• The region also experiences unstable power supply due to

extreme weather events and other natural hazards, as well as

scheduled maintenance operations of power companies

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• Damage caused by Supertyphoon Yolanda (Haiyan) to the

electricity sector amounted to PhP541.73 million. Losses in

revenue reached PhP1 billion.1

• The power outage that arise from the recent 6.5 magnitude

earthquake that struck the region will cost an average of

PhP105 million of losses per day in the energy and power

sector.2

____________________________

1SULHOG: Eastern Visayas Yolanda Reconstruction Plan 2Estimated by NEDA VIII

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RDP 2017-2022: Energy and Power Sector

Institute measures to ensure affordable and reliable

power supply

• Streamline approval process for power generation

projects

• Practice proper and regular maintenance to avoid

failure of the system

• Accelerate renewable energy (RE) projects through

the Renewable Energy Act

POTENTIAL RENEWABLE Energy Sources

3.15 MVA

5/6.25 MVA

10/12.5 MVA

20/25 MVA

138kV Line

69kV Line

230kV Line

ABS NGCP ABS

NGCP S/S

12/15 MVA

2-Transformer S/S

Existing

Substation

Submarine Cable

LEGEND

:

H

Kananga Mini-

Hydro (2MW –

LEYECO V)

H

Calbiga Mini-Hydro

(5MW – SAMELCO

II)

H Paranas Hydro Plant

(5MW – SAMELCO II)

Bugtong Mini-Hydro

(1MW – SAMELCO I) H

H H

Dagami Hydro Plant

(3MW – DORELCO &

LEYECO III)

S

Solar Plant (300kW – LEYECO III)

Javier Mini-Hydro

(1MW – DORELCO)

Las Navas Hydro

(5MW – NORSAMELCO)

H

H

H

Lawaan Hydro Plant

(1MW – ESAMELCO)

St. Bernard Mini-

Hydro (600kW –

SOLECO) H

S

Hydro Plant

SOLAR Plant

Source: Federation of Rural Cooperatives in Region (FRECOR) 8

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power supply

• Reduce power cost:

– Re-negotiate for a competitive selection process

generation rate

– Support government’s efforts in shifting the Feed-

in-Tariff (FiT), missionary and universal charges,

including taxes and subsidies from industry to the

national treasury

– Formulate an enabling policy to utilize energy

resource funds for any RE projects

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power supply

• Electric cooperatives to undergo structural and

operational reforms

• Continue or expand the implementation of the Sitio

Electrification Program of the DOE

• Ensure grid reliability, especially that of renewable

energy

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power supply

• Need to implement Transmission Development Plan

for Region VIII

Existing substations will be upgraded and new

substations will be constructed. Distribution lines

will be uprated and upgraded from single phase

to 3-phase.

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power supply

• Comply with the building code and standards for a

climate-proof and resilient infrastructure and facilities

to secure them against natural calamities since

transmission lines are the first to be affected during

typhoons

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Recent Developments

Special Regional Development Council VIII – Executive Committee (RDC

VIII-ExCom) Meeting on July 8, 2017

Resolution Rationale

RDC VIII-ExCom

Resolution 8-A, Series of

2017

Urging All Concerned

Stakeholders to Build Back

Better a More Resilient

Energy Sector

The recent disaster highlighted the need to

build back better a more resilient energy

sector as earthquake damaged the

Tongonan geothermal plants, which

resulted in the total power blackout in the

whole of Eastern Visayas and in Bohol.

This can be done by strengthening the

power grids through better connectivity and

transmission of power in and out of the

region. Furthermore, strategic management

of the power grids will reduce or prevent

damage to the power facilities in the event

of disasters.

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Recent Developments




RDC VIII-ExCom

Resolution No. 8-B, Series

of 2017

Enjoining the Department of

Energy (DOE) and Other

Concerned Agencies in the

Energy Sector to Review the

Regional Transmission

Development Plan and

Support the Eastern Visayas

Energy Development Plan

The Council enjoined the DOE to support

the Eastern Visayas Energy

Development and Resiliency Plan,

developed by FRECOR VIII, which will

provide stable and secure electrification

services in the region. This goal of

resiliency is consistent with Executive

Order No. 29, Series of 2017, which shifted

the focus from mere disaster awareness to

disaster resiliency, and Executive Order

No. 30, Series of 2017, which classifies

energy as a matter of national significance.

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Recent Developments




RDC VIII-ExCom

Resolution No. 9, Series of

2017

Creating a Technical Working

Group (TWG) to Study the

Formation of Eastern Visayas

Local Government Units

(LGU) Alliance for Resiliency

The Council saw the need to establish an

LGU alliance for resiliency wherein

neighboring cities and municipalities act as

the first responders in the affected areas

within the region. This system shall

strategically model out the roles of the

neighboring LGUs in the region during

disasters. The system can incorporate

electric cooperatives. As an example,

LGUs can register their generator sets and

be able to help those areas most in need in

case a similar power situation arising from

calamities occur.

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Recent Developments




RDC VIII-ExCom

Resolution No. 11, Series of

2017

Creating a Subcommittee on

Energy under the RDC VIII-

Infrastructure and Utilities

Development Committee

(IUDC)

The Council also acknowledged energy as

a regional development concern and

decided to form a subcommittee on

energy under the RDC VIII-IUDC. This is

intended to give closer attention on the

power/energy issues, considering the

importance of energy in the socio-

economic development of any area. This

sub-committee shall be chaired by the

DOE, with members to be identified by the

RDC VIII-IUDC.

Daghang Salamat!

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Climate Change, Industrial

Policy and Sustainable Energy: Opportunities and Challenges for

Eastern Visayas

42


Industrial Policy?


Opportunities and Challenges for Eastern Visayas · Support the Eastern Visayas Energy Development...

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