During The Manila Times' "Propelling Renewable Energy against Climate Change" forum this past Wednesday, lawyer Monalisa Dimalanta, who is the former chairman of the National Renewable Energy Board (NREB) and one of the nation's foremost experts on the subject, touched on one of the programs the government is using to plan and facilitate the development of renewable energy (RE) in the Philippines.
The program is called Grid Planning and Competitive Renewable Energy Zones, or CREZ for short, and is one of the truly impressive pieces of work done by the Department of Energy (DoE) under the Duterte administration. In a forum with several expert speakers presenting a wealth of information, there are always some topics that deserve more attention than it is possible to give them at the time, and CREZ is one of them. We think it is worthwhile to examine it in greater detail.
One of the biggest issues in RE development is transmission. It is one thing to be able to create a solar, wind, hydropower, geothermal or other RE generating facility, but it is quite another to connect it to the businesses and households that need the electricity. The problem is largely physical. The locations where RE resources such as good sun exposure, steady winds, suitable rivers or geothermal vents exist are often in remote areas, where connections to the transmission grid are not available or would be costly to build.
And to some extent, energy development is handicapped by the country's laws that keep power generation, transmission and distribution separate. It might be easier to develop RE if a single enterprise could design, build and operate an end-to-end system, but that is impossible under the Electric Power Industry Reform Act of 2001 or Epira. Thus, any energy system is at the mercy of three separate and often competing sets of business interests, and as a consequence, the development of energy here in the Philippines is slower than it should be and consistently lags behind demand.
The CREZ initiative is intended to answer these challenges. CREZ is a planning process that identifies the most economic RE resource areas in the Philippines, so that transmission planning and expansion can be focused on these areas. As the Department of Energy explains the initiative on its website, "By proactively focusing transmission expansion to these resource areas, RE generation development obstacles such as transmission access, energy curtailment, land permitting (such as protected or high-slope areas), and regulatory barriers are easier to overcome thus reducing risk for private sector RE investment."
In other words, the DoE is doing most of the feasibility study-level work for private sector investors on both the generation side and the transmission side. CREZ identifies areas where good RE resources are available - the initial work has focused primarily on solar and wind, although it will eventually be expanded to include more hydro, geothermal and biomass prospects - and then balances that potential against the feasibility of connecting the resource area to the national grid.
The process takes into account environmental factors such as the impact on protected or high-risk lands, social factors such as the effect of development on indigenous and other local populations, and demand factors. The output of the CREZ process is essentially a map of areas where the RE developers and the transmission system developers can be assured that their respective investments will benefit from the best possible balance of risk and reward. The benefits to the country as a whole are that new energy capacity from sustainable sources can be developed more quickly and be integrated quickly into the national system while, at the same time, ideally reducing power costs and giving energy consumers more choice.
With a year to go before a new administration takes office, the concern about CREZ, as with other good, long-term initiatives, is that the policy and planning momentum that has been established will be lost with a change in government. We certainly hope that does not happen, and we would urge the next administration - whoever it is - not to let CREZ fall by the wayside.
This article was originally published by Manila Times.
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