Renewable Energy Bill Set to be
Ratified by Congress

The Renewable Energy (RE) bill - which seeks to help decrease dependence on imported fuel - is set to be ratified by Congress after the same has been approved today at the bicameral conference level.

"This is one major step towards freeing the Filipino people from the clutches of imported crude products. Through the renewable energy bill, we are able to explore alternative energy resources which the country has not yet tapped," said Angara, who principally authored and sponsored one of the primary bills which were put together to embody Senate Bill 2046 or the Renewable Energy (RE) Act of 2008.

He added, "The future is in clean, renewable energy, which is predicted to be one of the biggest industries in the next 5 years. The benefits of renewable energy use are considerable: it will foster sustainable growth, energy independence and economic security for the country, and unite us with the global effort to stop climate change."

RE use can save the country valuable foreign exchange of as much as $3.6 billion or almost P200 billion in fuel purchases. Every 600 million kWh of RE generation saves one million barrels of oil. The Philippines could avoid having to buy more than 100 million barrels of oil by developing 2,500MW of RE-based plants by 2014.

The Renewable Energy 2007 Global Status Report said that more than 65 countries now have set targets for their own renewable energy futures, many of which have enacted policies to meet those goals. Germany leads the world in new capacity investment, followed by China, the US, Spain, and Japan. Countries like India, Spain and China have greatly increased their wind power capacity; Turkey, its solar power capacity; and Brazil, its ethanol production.

The investment community has similarly trained its focus on RE, with almost 100 clean tech companies now adding to the ranks of top performers in the Canadian stock exchange, with a market value of more than $13 billion as of the end of 2007.

Investors are banking on the steady returns from companies that produce power from wind farms and other clean sources such as geothermal and hydro. By 2014, it is expected that market demand for wind energy will be up to US$48 billion, followed by solar at US$40 billion, and fuel cells at US$ 15 billion.

"Based on the experience of other countries, there is a link between electricity rate and the level by which a country is able to develop its indigenous energy resources. This is especially important to a country like ours, which has the 2nd most expensive power rates in the region. Vietnam's power rates are almost half of ours because it has diversified and tapped its renewable energy sources," Angara added.

Angara - who also chairs Senate Committee on Banks, Financial Institutions and Currencies - warned that energy will be the country's most critical resource which impacts on food production, unless it weans itself from heavy dependence on oil.

"Although oil prices in the world market have slipped a little, this will prove to be unsustainable in the long run as global demand for energy is rising fast with population growth and dramatic economic changes in developing countries," he said.

In 2006, the country's net oil imports went up 20% to $6.8 billion. Crude oil prices have been escalating during the past years, reaching all-time highs above $98/barrel in November 2007. The price increases are attributed to the strong global demand, particularly from China and India, the geo-political situation in the Middle East, the thinning capacity of OPEC countries and weather-related supply disturbances. In January 2008, the cost of oil rose to $100/barrel.

Analysts explain that further spikes in oil prices carry wide-ranging effects on the economy and will incur greater damage among small entrepreneurs and low-income earners, who cannot cope with rising prices of consumer goods.

Meanwhile, Angara also vowed to strengthen incentives by allocating a certain portion of the 2009 General Appropriations Act to promote the use of renewable energy.