More spending on energy efficiency projects pushed

Date Published: 
October 5, 2020
  • During the virtual Luzon Energy Efficiency and Conservation Forum for Local Development, Philippine Energy Efficiency Alliance (PE2) president Alexander Ablaza said that energy efficiency projects could create more jobs compared to other stimulus interventions. (File Photo: Facebook, Philippine Star)
    During the virtual Luzon Energy Efficiency and Conservation Forum for Local Development, Philippine Energy Efficiency Alliance (PE2) president Alexander Ablaza said that energy efficiency projects could create more jobs compared to other stimulus interventions. (File Photo: Facebook, Philippine Star)

(PE2 note: The Philippine Star reports PE2’s position that EE can create more jobs than other stimulus activities.)

MANILA, Philippines — An energy group is urging the government to accelerate public spending on energy efficiency projects as these are seen to generate more employment.

During the virtual Luzon Energy Efficiency and Conservation Forum for Local Development, Philippine Energy Efficiency Alliance (PE2) president Alexander Ablaza said that energy efficiency projects could create more jobs compared to other stimulus interventions.

“We feel that for the same amount of stimulus funding or mainstream investment, 45 percent more jobs can be created in energy efficiency compared to the energy, transport and water projects that are under the Build Build Build program of the government,” Ablaza said.

“Potentially between now and 2040, using that same labor intensity, we are looking at over nine million jobs that can be created across the countryside in LGUs, in urban and rural settings, and can be created from energy efficiency projects,” he said.

Apart from creating jobs, Ablaza said that the energy efficiency sector is also seen to reduce operating expenditures of income-generating activities.

“Energy efficiency projects have minimal environmental impact and are still the least-cost means for the country to meet its energy security objectives and greenhouse gas emission reduction obligations, “Ablaza said.

The PE2 president also presented estimates by the group that the Philippine energy efficiency sector has capital requirements of about P12 trillion from 2017 to 2040.

Ablaza said that only a third of the capital requirements or P4 trillion could be mobilized through business as usual modalities such as self-financing, debt-financing, lease-financing and other modalities.

He emphasized that the remaining P8 trillion needs to be mobilized through innovative capital flows such as ESCO performance contracts, PPP transactions, joint-venture agreements, government, large-scale retrofit programs and other third-party financing.

PE2 earlier stressed the urgent need for the granting of pioneer status across all Energy Efficiency and Conservation (EE&C) projects availing of fiscal incentives.

“The alliance needs DOE to defend this provision before the  BOI, with the argument that EE, which the global energy market has started to treat as a first fuel and therefore an indigenous, non-conventional energy resource that needs to be tapped, qualifies for pioneer status, as provided for under Article 17 of EO 226 (Omnibus Investment Code),”Ablaza said.

Last month, the Department of Energy (DOE) adopted the group’s recommendation to classify energy efficiency and conservation (EE&C) as a first fuel of the economy, which will enable the industry to receive fiscal incentives from the Board of Investments (BOI).

“We hail the DOE push for EE&C as first fuel. PE2 also seeks the harvesting of wasted energy as an indigenous, non-conventional energy resource across all designated establishments and not limited to Investment Priority Plan sectors only,”Ablaza said earlier.

The government has been taking steps to address energy efficiency through the signing of the EE&C Act by President Duterte in May last year.

As part of the law, the Interagency on Energy Efficiency and Conservation Committee (IAEECC) was created for the implementation of the Government Energy Management Program (GEMP).

The GEMP targets to reduce the monthly consumption of electricity and petroleum products through electricity efficiency and conservation, as well as efficiency and conservation in fuel use of government vehicles.

Written/Posted by: 
Catherine Talavera

About PE2

Philippine Energy Efficiency Alliance Inc. (PE2), is a non-stock, non-profit organization of energy efficiency market stakeholders.

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Republic Act 11285

R.A. 11285 - An Act Institutionalizing Energy Efficiency and Conservation, Enhancing the Efficient Use of Energy, and Granting Incentives to Energy Efficiency and Conservation Projects

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IRR - Signed

Beyond COVID-19: How governments, ESCOs and innovative financial modalities can mobilize energy efficiency capital through 2040

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