Wind power sector gets boost from ADB

By Amy R. Remo Philippine Daily Inquirer 11:03 pm | Friday, November 2nd, 2012

Technical assistance grant to build PH capacity
The Asian Development Bank has granted a $500,000 technical assistance to the Philippine government to promote and build the country’s wind power generation capacity under the bank’s Quantum Leap in Wind Power program.
 
Energy Undersecretary Jose M. Layug Jr. said on Wednesday that the Philippines was one of the program’s recipient countries, together with Mongolia, Sri Lanka and Vietnam. The target was to bring promising climate change-related technologies to commercial production.

According to Layug, the amount could be used for the revision of the existing wind energy roadmap, wind resource mapping, knowledge and capacity building, and prefeasibility studies.

Layug disclosed that the Department of Energy was planning to put up wind masts to measure the availability of wind in Cagayan, Aklan and Camarines Norte, where there are existing service contract holders. The energy agency was hoping that with more available data, it could fetch a better work program from prospective investors.
 
The DOE, however, was still identifying which institution would manage the data to be collected. So far, according to Layug, the DOE was looking at educational institutions such as the University of the Philippines, Ateneo de Manila University, University of Asia and the Pacific or the Asian Institute of Management (AIM).

It is also considering government agencies such as the DOE itself, the Department of Science and Technology or the Philippine Atmospheric, Geophysical and Astronomical Services Administration (Pagasa) as well as nongovernment institutions or the Wind Energy Development Association of the Philippines (Wedap).

The last study conducted on the country’s wind resources was the Philippine Wind Energy Resource Atlas prepared by the US National Renewable Energy Laboratory in 2001.
 
According to this study, the Philippines had 76,600 megawatts of total wind potential in six regions: the Batanes and Babuyan islands, north of Luzon; Ilocos Norte; the higher interior terrain of Luzon, Mindoro, Samar, Leyte, Panay, Negros, Cebu, Palawan, eastern Mindanao and adjacent islands; coastal locations from northern Luzon to Samar; wind corridors between Luzon and Mindoro, and islands between Mindoro and Panay.
 
The Philippines only has one wind farm, the 33-MW Bangui Bay project [pathetic!!!!!] installed by North Wind Power Development Corp.  The DOE said it would add 2,345 MW of wind capacity by 2030 to remain as the leading wind energy producer in Southeast Asia.

Yes, indeed! Very pathetic. The Philippines has 76,600-MW of total wind potential. But, it only has one 33-MW wind farm.
Why is this so? Believe one reason is the moratorium. Scares off investors.

Radio Australia Updated 13 July 2012, 11:40 AEST

The Australia-New Zealand Chamber of Commerce has hit out at the Philippines' moratorium on new mining permits and a plan to increase taxes on the industry, saying it could scare off investors.

The group's President Ian Porter says he does not think companies will spend money to explore on the islands without the prospect of a licence to mine.

Philippines President Benigno Aquino's executive order on mining policy, details of which were released Monday, is aimed at boosting revenues from the sector while increasing environmental safeguards.

A key provision of Mr Aquino's order is a proposal to hike taxes to from two to five percent of mining companies' gross earnings, a move that requires approval from a Congress dominated by Aquino allies.

But Mr Porter says the tax hikes involved will also be bad for business. He says foreign investors will also want to know the taxes and levies the government will impose on projects before committing money.

No certainty
Other business groups have also been vocal in their opposition to plan. The Joint Foreign Chambers, which represents major foreign business groups, said the moratorium on new mining agreements created uncertainty among prospective investors in the mining sector.

The group, in a statement, said companies would not engage in exploration activities unless they had a firm mining agreement and knew how much they would be taxed.

"No mining company can be expected to spend extremely large amounts of money on exploration without certainty, the grant of a mining title and without first knowing the fiscal regime," the statement said.

Other business groups have called for the Philippines congress to pass the bill quickly to avoid a slowdown in investment and damage to the country's economic growth.

Officials had said they were hopeful it would be passed this year, though they could not give guarantees.

The government estimates the Philippines has at least $840 billion in gold, copper, nickel and other deposits but this has largely been largely untapped, due to anti-mining campaigns, poor infrastructure and security concerns.

ABC/AFP

ADB 15 July 2013

MANILA, PHILIPPINES – The Philippine Investment Alliance for Infrastructure (PINAI), a fund which is partly financed by the Asian Development Bank (ADB), is investing up to $85 million for a wind farm project in the northern part of the country.

The 81-megawatt project – PINAI’s first investment ever – is a joint venture with AC Energy Holdings Inc., a wholly-owned subsidiary of Ayala Corporation, and UPC Renewables Partners (UPC) through UPC Philippines Wind Holdco BV.

“We are delighted that PINAI has selected a green power project as its first investment. It is aligned with our objective of making the country’s growth more inclusive and sustainable,” said Janette Hall, Senior Investment Specialist at ADB’s Private Sector Operations Department.

PINAI will own 32% of the project, while AC Energy and UPC will own 64% and 4% respectively.

The project will have two phases, with the first phase generating at least 54 megawatts, to be connected to the grid by June 2014.

PINAI is a $625 million private equity fund focused exclusively on Philippine infrastructure projects. It was launched in July 2012 to capitalize on the various public-private partnership opportunities in the Philippines. PINAI should spur more private equity funds that will catalyze additional long-term capital into the country, and further development of domestic capital markets.

According to the Philippine Development Plan, around 12% of the country’s $120 billion investment requirements need to come from the private sector.

PINAI is managed by Macquarie Infrastructure and Real Assets. It is jointly financed by ADB, Philippines’ state-owned pension fund Government Service Insurance System, Dutch pension fund asset manager APG, and the Macquarie Group.