WSHPDR_2013_Final_Report-updated_version

3.4.6 Philippines
Jose D. Logarta Jr., Philippine Association of Smallscale
Hydro Developers, Inc. (Pass-Hydro)
Key facts
Population 103,775,002 1
Area 300,000 km 2
Climate Tropical maritime; with northeast
monsoon (November to April) and
southwest monsoon (May to
October) 1
Topography
Rain pattern
Mostly mountains with narrow to
extensive coastal lowlands; more
than 7,000 islands
The mean annual rainfall of the
Philippines varies from 965 mm to
4,064 mm. 2
Electricity sector overview
The national electrification rate was 89.7 per cent in
2009. 3 The Philippine power sector continues to
undergo the most radical transformation since the
end of the Second World War, with the restructuring
of the whole industry under the Electric Power
Industry Reform Act (EPIRA) of 2001. The reforms
include the breakup of what used to be a government
monopoly in generation and the privatization of the
transmission operations via monopoly franchise. More
ambitious steps leading to competition at the retail
level are pending at the electricity regulation agency.
As of 2012, the Luzon and Visayas grids are
interconnected and central dispatch is undertaken by
a system operator. All transactions however, go
through a compulsory wholesale pool. The Mindanao
grid is isolated and suffers the most transmission
constraints and excessive dependence on
hydropower.
The electricity production is dominated by thermal
sources (figure 1). About 86 per cent of the hydro
resource potential can be developed by large hydro at
18 locations across the country. Hydropower is the
dominant renewable energy source in the Philippines,
accounting for 21 per cent of the 16,359 MWinstalled
generation capacity as of 2010. Around 20 per cent of
the hydro capacity is privately owned (including all of
the small run-of-river plants), or privatized via
competitive biddings under EPIRA. The National
Irrigation Authority owns a few multi-purpose
hydropower units but there are no clear plans afoot to
have these privatized.
Other renewables
Hydropower
Diesel
Gas turbines
Oil thermal
Geothermal
Natural gas
Coal
0.13%
1.80%
2.03%
6.76%
10.59%
14.81%
29.11%
34.76%
0% 10% 20% 30% 40%
Figure 1 Electricity generation in the Philippines
Source: Department of Energy of the Philippines 4
Small hydropower sector overview and potential
All of the run-of-river small hydropower plants are in
private hands. About 888 sites have been identified as
having mini-hydropower potential totalling 1,847 MW,
the remaining 29 MW being micro hydropower
potential (figure 2).
SHP installed
capacity
SHP potential
248 MW
1876 MW
0 500 1000 1500 2000
Figure 2 Small hydropower capacities in the
Philippines
Renewable Energy Policy
Renewables policy is now governed by the Renewable
Energy Act of 2008. The most important provisions are
the Renewable Portfolio Standards (RPS) that
subsumes the more substantive feed-in tariff (FIT).
The first set of proposed FIT rates for emerging
renewable energy, including small-scale hydro, is
under deliberation before the Energy Regulatory
Commission (ERC).
Legislation on small hydropower
In 1991, the re-established democratic Congress
enacted the mini-hydropower Incentives Act (Republic
Act 7156), limiting incentives to run-of-river plants,
defined as those utilising the ‘kinetic energy of falling
or running water’, and those with capacity ranges
from 101 kW to 10 MW. 5
The official hydropower development programme of
the Philippine Department of Energy foresees a FIT
and a RPS as well as mini-hydropower project
auctions. 4
Barriers to small hydropower development
Political ambivalence and bureaucratic delays in
the implementation of the Renewable Energy Act
of 2008. Legislators are now calling for
‘competitive auctions’ to achieve installation
targets for the qualified renewable energy
technologies, ostensibly to minimize their tariff
impacts.
A more recent development that has alarmed
run-of-river small hydropower developers is the
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