PE2 seeks Tier III classification of all EE projects in SIPP consultations
MAKATI CITY, 18 February 2022 -- The Philippine Energy Efficiency Alliance (PE2) pushed anew for the re-classification of all energy efficiency (EE) projects to a Tier III domestic market activity during the public consultation on the proposed Strategic Investment Priority Plan (SIPP) held earlier today by the Philippine Board of Investments (BOI).
Following the presentations on the draft SIPP by BOI Managing Head Ceferino S. Rodolfo, Undersecretary Rafaelita Aldaba, and Director Sandra Marie Recolizado, PE2 president Alexander Ablaza kicked off the open forum articulating the PE2 position.
Ablaza said, “The Philippine Energy Efficiency Alliance understands from this morning's presentations that BOI classifies simple/non-strategic EE as Tier II and strategic/innovative EE as Tier III in the draft SIPP, as mandated under Republic Act No. 11285. Not only should EE be optimized as the priority climate-friendly energy resource ahead of renewable energy, PE2 believes that EE is 45% more labor-intensive than Build-Build-Build infrastructure projects for the same volume of investments. PE2 nonetheless echoes it manifestation before DOF, BOI and DOE that Tier III re-classification of all EE projects, regardless of whether the EE project is strategic or not, will be needed to make third-party investments in EE projects commercially viable and attractive to local and foreign investors. PE2's letter to DOF Sec. Dominguez on 12 November 2021, with which BOI and DOE were copied, lists the multiple justifications for the reclassification of EE under Tier III within the legal context of the CREATE Act. Accelerating the carbon and energy intensity reduction of the country and effective job generation are certainly main pillars of the structural transformation of the economy. Moreover, Sec. Dominguez' reply to PE2 of 24 November 2021, is seen by many as a no-objection statement by the FIRB chair on the Tier III re-classification of EE by BOI. Lastly, PE2 recommends that Tier III should not be limited to the "pioneering technology" constraints posed by the previous framework under Article 17 of Executive Order No. 226, but instead focus on the economic, energy and climate development impacts.”
In response to the PE2 comments, BOI Director Recolizado said that they received a copy of the PE2 letter to DOF and they have considered PE2’s justifications. BOI however proposed new qualifications in the Tier III category, which therefore effectively assign the simple and less innovative EE projects to Tier II.
PE2 vice president for external affairs Theresa Acedillo-Lapuz likewise shared the PE2 view that the location-based incentive framework of the CREATE Act was not consistent with the objective of EE projects to harvest and recycle inefficient use of energy in the more energy-intensive regions such as the National Capital Region and other metropolitan areas.
On 17 February 2022, BOI announced through its website today’s conduct of the virtual public consultation on the proposed SIPP. Aiming to gather comments and inputs to improve and refine the draft SIPP, the public consultation was led by Usec. Rodolfo and Usec. Aldaba and supported by Dir. Recolizado.
Serving as the leader of the country’s investment promotion agencies (IPAs), the BOI is finalizing the SIPP, which is a critical tool in attracting potential investors to the Philippines. To date, a transitional SIPP is in effect based on the BOI’s 2020 Investment Priorities Plan. Throughout the drafting, a number of industry studies and parameters have been considered. The SIPP is a provision under the CREATE Act, which lists the investment projects and economic activities entitled to investment incentives.
