Keynote Speech at the Philippine Solar Summit 2012
SMX Convention Center, Pasay City

I’d like to greet you a very good and sunny day.

I want to thank Philippine Solar Power Alliance for inviting me to this event and for continuously enlightening us on the necessity and potential of utilizing solar power for the country’s energy needs.

At the time of the drafting of House Bill no. 5405 (October 11, 2011) or An Act Providing for Incentives and Credit Facilities for Consumers of Small Solar Power Systems in the Philippines, oil and electricity prices were at an all-time high. The country had just been bestowed a new record for having the most expensive electricity rate in Asia, beating Japan with an average retail rate of electricity at 18.1 US cents per kilowatt-hour. The study, made by the consulting firm International Energy Consultants and presented by Meralco to the Philippine Chamber of Commerce and Industry (PCCI), revealed that with the exception of Japan and Singapore, consumer elsewhere in Asia pay electricity rates equivalent only to the generation charges Filipino consumers pay. The group attributed the high cost of electricity to the passing on of costs and taxes to consumers.

Unlike other countries in the region, the Philippines has not only privatized its strategic electric power sector but it also does not give state subsidy to cushion the high cost of energy. (Source: Philippines has most expensive electricity in Asia, Manila Bulletin, February 23, 2011 http://www.mb.com.ph/node/305841/philippine)

Such high prices doubly burden poor Filipinos, a big majority of whom are earning way below the living wage. In fact, energy, together with water, is the fourth biggest expenditure of Filipino families according to the latest Family Income and Expenditures Survey. For extremely poor families, it is third to food and house rental, eating up funds that could have been used for education or health care.

Not only does high power rates burden the poor, it also directly affects businesses in the country. High electricity rates either force small companies who cannot cover such expenses to close shop or larger ones to transfer to other countries that offer a better and cheaper working environment.

As a representative of the marginalized sectors and chairperson of the Congressional Committee on Small Business and Entrepreneurship Development, I have long urged the government to act on these problems by assessing current policies and putting forward long-term solutions.

Besides filing measures to address the problem of high energy prices, like our proposal to remove or cut the value added tax on oil and power, we have also been pushing for alternatives energy sources and actively took part in the crafting of the Philippine renewable energy law.

One beaty of solar power is that it is modular and ideal for households and small business enterprises. So we had this idea of using solar power to liberate households and small businesses from the stranglehold of the big, greedy, dirty power companies. I wanted a law that would literally give power to the people.

To ordinary consumers, however, solar rooftops are beyond reach due to the relatively high cost of the equipment. But because of its benefits which everyone acknowledges, it should be government’s duty to make solar technology attractive by instituting various systems such as the feed-in-tariff, as well as subsidies and loans which are already in place in countries where solar energy has made a headway.

It is in this light that I filed the One Million Solar Roofs Act. The bill aims to harness the abundance of solar energy, taking into consideration the Philippines as being second in Southeast Asia in terms of irradiation and insolation, and the modular nature of solar energy systems to immediately and sustainably address the energy problem of the country, particularly the needs of the small consumer. It complements the current renewable energy law.

This bill provides for incentives and financing facilities to encourage the use of solar energy by ordinary electricity consumers like residences, offices and small to medium business establishments. Loans will also be made available through the Pag-IBIG Fund, the Government Service Insurance System (GSIS) and the Social Security System (SSS), among other credit and financing agencies. We want solar rooftops to be qualified for loan packages covering household construction, repair and renovation.

Under House Bill 5405, the Department of Energy, National Renewable Energy Board and the Housing and Urban Development Coordinating Council will encourage installation of small solar energy systems in homes and business establishments all over the country, targeting a million rooftops in the next ten years.

Qualified participants may avail of the same incentives provided for renewable energy developers as provided for in Republic Act no. 9513 or the Renewable Energy Act. These include income tax holiday for commercial operations, duty-free importation of solar machinery, equipment and materials, among others. At the same time, the bill reiterates that participants may enter into net-metering agreements with distribution utilities.

It is hoped that through this bill, the demand for clean solar energy, as well as the opportunities for local manufacturing and related solar energy products and services, will increase. This will hopefully in turn pave the way for cheaper solar energy systems.

These are just some of the provisions of HB 5405. In any case, it will undergo public hearings and further fine-tuning. And when it hopefully gets approved, there is also the drafting of the implementing rules and regulations for more specific details. Rest assured, we will invite the sector to the committee hearings, so you may impart additional information and recommendations. As early as now, you may also send position papers to help hasten the passage of the bill.

But even while we are waiting for the legislative process, our group has already initiated a program that will bring solar energy to far-flung areas where it is most needed. In light of the lack of electricity access in rural areas, our party-list launched Bayang Maliwanag: A Village Electrification Program. It aims to provide sustainable electrification for communities, promote partnerships between local government units and local organization and harness local capacity to sustain continual use of solar energy.

Bayang Maliwanag was formally launched last march with the connection and fitting of eleven solar energized street posts in Sitio Harangan in Brgy. San Isidro, Rodriguez, Rizal. The sitio, home to 750 families, has had a long-standing request for MERALCO to provide electricity. However, this request has not been acted upon.

In the same period, another project was launched in a resettlement area in Brgy. Dayap, Calauan, Laguna. Another set of street posts were erected with lamps and batteries.

This is just the start. I am hoping that our efforts will bear fruit in the following months. I will always be an advocate of renewable energy. More importantly, I am an advocate of its democratized access. I see brighter days ahead, where renewable energy is a norm and not just an alternative and where each and every Filipino has access to it. Let us help each other in making this dream a reality.#



16 thoughts on “One Million Solar Rooftops: Legislator’s View of Solar Energy

  1. You should study the experiences of ongoing RE-based household and village electrification projects being done by the private sector and through development assistance projects in off-grid communities, particularly in Mindanao, where the highest percentage of unenergized households are located, and where energy access is the challenge, and not the expensive cost for electricity.

    You would also do well to consult with recognized technical experts and ground practitioners. Listen to their stories to ground the provisions of your bill, as well as the strategies that you use for implementing your village electrification projects. They have been doing this since the 1970’s, and it would be good for your people to confer with those who already did it, and learn from their experiences.

    Of so many lessons learned, I would like to point out two: One, the recipients must accept their roles as managers of these communal systems, otherwise, these will fall on the wayside as time passes and nobody will buy a new battery, or purchase replacement parts. Community awareness must also be raised in tandem with this intervention, particularly on the basics of the technology itself and the requirements for a sustained operation of these systems. And two, these communities must have access to the hard (technology and products) and soft (i.e., micro-financing, manpower skills to provide after sales/repair) infrastructure to continue enjoying the benefits of RE-based electrification.

  2. The communal solar electrification systems done in Verde Island was more on providing the inhabitants of the island a means to charge their batteries for powering their lights, TV and radio. Prior to that the folks had to go to Batangas to charge their batteries. The problem arises when a storm comes in and they cannot travel.

    The solar system provided to them helped that community to charge their batteries for their use.

    While there are also people in Mindoro that I know of which were offered solar power systems since their area does not have any electrification system as they are located in mountainous areas where they tend their crops.

    A friend of mine who actually lives also in those remote areas paid around 49K for a solar powered system which has around two panels and provided power for their lights, fan and TV.

    The Bill should provide tax incentives to this type of products so that the actual cost of these solar products would not be too pricey. This may be asking too much but please consider that the MAJORITY of our people in the private and public sector are not that well off. As you well know.

    By doing so your one million may reach far more. And by that time the lower sector who could not afford to get those will hopefully have a far less cheaper electricity due to the magnitude of homes who will avail of this solar power.

    The life of batteries are not the same as the solar panels. Solar panels may last around 20 to 25 years as some suppliers would say. But batteries may last only around 3 to 4 years or less.

    Can your bill also include tax incentives for SSS and GSIS members in purchasing replacement batteries as well as solar system components that may need to be replaced at end of its useful life. VAT exempt if possible.

    Can you also please include an accreditation of suppliers of these systems so that they be held liable for any defects on their products. Their replacement warranties should not be limited to 7days only but should be at least 6 months or more. Our Consumer Act is not pro consumer but more of pro supplier.

    Anyway, thank for passing this bill. A lot of us is hoping this would come asap.

    • Thanks Tomtax. Actually, the Renewable Energy Law already provides such incentives but for commercial developers. So what I did in the One Million Solar Roofs bill is categorically state that the same inventives be given to ordinary households who put up their own solar power systems.

  3. Great blog here! Also your site loads up fast! What web host are you using?
    Can I get your affiliate link to your host?
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  4. Sir, a great proposal which I hope gets passed. I am planning to go solar. Its November 2012 any updates on the status of your bill? More power!

  5. Good day! Would you mind if I share your blog with my myspace group?
    There’s a lot of people that I think would really appreciate your content. Please let me know. Cheers

  6. Great speech Congressman Teddy. Your house bill would definitely be a great impetus for the foundation of a future robust and vibrant solar industry in the Philippines. The provision of a mass base for solar will defintely change the current scenario and attract more investments and national attention, both key factors to establish this nascent industry. I just want to add a different perspective on how “expensive” solar has been perceived. The current cost model of installing solar systems have greatly improved since the time most studies were published and so much market competition on a global basis and the worldwide inventory glut of solar panels has made it possible for lower cost systems. I am a solar supply chain practitioner for the past 5 years and have personally experienced the sudden drop in prices throughout the entire supply chain over the past 1.5 years, mainly as a result of overcapacity, overproduction and as mentioned excessive inventory. The time for solar in the Philippines is here and now. I agree with you 100% that brighter days are definitely ahead and we can definitely make solar in the Philippines a reality soon!

  7. I am interested to go solar if indeed the cost has gone down… There are upland communities in Central Visayas that do not have access to electricity until now. Any update on the bill sir Ted Casino sir? Thanks and more power.

  8. The most important thing to share is the status of this act… how can we avail… how much… will it be available in Manila and what is the role of the gov’t (Executive Dept’s DO Energy) to realize this… I’m pretty sure everybody is interested about this.

  9. To Congressman Teddy, my fellow countrymen, bloggers , fellow reformers , concerned citizens and netizens:

    The One Million Solar Rooftops Bill will indeed go a long ways in spearheading the solar industry in the Philippines . Thank you Congressman Teddy for this brilliant , timely and aggressive lawmaking . It will not only help bring everyone’s electric rates down , it will also help increase profits for businesses just to name a few of the advantages that solar will bring as you have mentioned.

    We are a US-based solar company with a recently established presence in the Philippines. Mendoza Solar , LLC is a California and Nevada Corporation with its subsidiary corporation Lim Solar Philippines.

    Under Lim Solar , we have a program called Nanay and Tatay Solar which we are preparing to cover residential solar installations in the Philippines . We are not offering financing for residential or small KW projects at this time . We are however looking to implement this shortly after we have secured and completed several larger projects.

    Our key objective is to install solar generating systems that will produce power at rates that are lower than present rates . It can be done with proper loan structuring.

    Our short-term focus are the large commercial and Utility/Power Producers with several hundred KW power requirements and up to several Megawatts of power production.

    Most importantly we can help solution the recurring power shortages in Mindanao and the rest of the nation in a much shorter time than most proposed projects whether they are Solar or conventional power production systems. We are offering both long term and short term solutions to these perennial power shortages. Megawatt scale solar installations do not take years to plan and build. We are very competitive in rapid deployment of even the Megawatt size installations.

    We are aware of the recent recurrence of power shortages in Mindanao and how we are scrambling …again .. to fix it with the usual quick-fix , non-sustainable , expensive , non-long term solution use of GenSets.

    We are offering 100% financing to large (MW) or several hundred KW projects to qualified clients. This will truly expedite the alleviation if not the eventual elimination of these perennial power outages and shortages.

    We are hopeful that our decision makers will attach quick fixes now to long term solutions of the future. As you yourselves are aware of this , Solar (PV) Power systems are the best positioned, no-nonsense solution that will do just that.

    Thank you.

    Joe Joson
    Mendoza Solar / Lim Solar Philippines

    Mr. Mendoza is preparing to visit the Philippines shortly on his 5th or 6th visit there in the last year and a half. He will meet with all interested parties in Manila , Davao etc.

    Please contact us at : info@limsolar.com / CEO , Winston Mendoza at winston@mendozasolar.com / or joe@limsolar.com / joe@mendozasolar.com


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  11. Pingback: Uses Of Solar Energy In The Philippines - Green Energy Efficiency

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