Philippines: Polluters Must Pay

Author: Darvin Tocmo  Date Posted:10 November 2016 

Philippines: Polluters Must Pay Coal-fired generating plants are still the main energy sources in the Philippines. To take the steps for cleaner energy, the Department of Energy (DOE) will create a climate change fund paid for heavy polluters through a carbon tax, and this is supported 100% by the Philippine Solar Power Alliance (PSPA). The Philippine Solar Power Alliance (PSPA) declared it will work with DOE and Congress in developing a climate change fund that will not only finance the FiT allowance but will also cover health programs in areas near coal power plants as well as finance disaster-mitigation programs, in reaction to the declaration of Energy Secretary Alfonso Cusi that he is reluctant to implement another feed-in tariff (FiT) program that is funded by a customer surcharge. “The RE Law didn’t prescribe the FiT-All as a pass-through to the consumers,” PSPA President Tetchi Capellan said last Wednesday. Currently, the installed capacity of solar power in the Philippines is almost 1 gigawatt. With the dramatic drop in module prices, solar will be at grid parity in the next six years and incentives will become irrelevant.” Last 2008, the government included the FiT in the Renewable Energy (RE) Law in order to attain energy security and mitigate climate change. This non-fiscal incentive provision granted to implementors of clean energy projects guarantees the payment of the price difference between wholesale electricity market and the FiT. At present, the price gap called the RE Charge is approved by the Energy Regulatory Commission (ERC). It amounts to P0.12 per kilowatt-hour (kWh) and is charged universally to consumers. Countries like India, Canada, and Australia already levy a carbon tax on heavy emitters. In India for example, the clean energy tax levied on coal power plants raised as much as 25 billion rupees ($535 million) in one year alone. This money helped finance health and renewable energy initiatives. “We believe that some kind of mechanism can un-burden the consumers and solve the problem of funding the renewable energy program of the government as prescribed by the RE Law. The levy would effectively shift the burden of cleaning the environment from the consumers to the polluters. It would also encourage coal power plant owners to re-direct the taxes and invest instead in clean energy projects in order to balance the pollution created by coal power plants,” the Philippine Solar Power Alliance (PSPA) said.