New incentive set for renewable energy investors

MANILA, Philippines - The government has dangled another incentive to potential investors in the renewable energy (RE) field which would allow them to charge slightly higher tariff rates for the production of energy from renewable or alternative raw materials.

This was disclosed over the weekend by Marriz Agbon, president of the Philippine Agricultural Development and Commercial Corp. (PADCC) following a recent trip to the United States.

According to Agbon, the Renewable Energy Board has applied with the Energy Regulatory Commission (ERC) for a feed-in tariff for biofuels.

The feed-in tariff, Agbon said, would be in addition to the regular generating cost of power generating firms.

Thus, a firm generating power for example from biomass or biofuel would be allowed to charge an additional feed-in tariff based on the renewable material the firm is using, Agbon said.

The ERC, however, will still deliberate on the proposal, Agbon said.

The ERC is now conducting hearings on the proposal.

Agbon visited the US last month, along with private sector representatives from the Philippine Sugar Millers Association (PSMA), to attend a workshop on biofuels technologies in Washington and seek financing for renewable energy projects.

They were also able to visit the University of Denver and tour a ligno-cellulosic facility in the US.

The PADCC official took the opportunity to present interested investors with possible partnership projects with at least eight Filipino firms.

Agbon reported that he met with at least nine interested American firms.

The interested US firms include KL Energy Corp. which is reportedly interested in a village-level biodiesel or bioethanol project.

Another firm, SG Biofuels is interested in jatropha.

The San Diego-based firm, Agbon said, has a gene bank for 6,000 types of jatropha which can be grown in any climate.

Biofuels firms such as Rentech, Agbon added, expressed interest in the production of bioethanol jet fuel or aviation gas.

American firms are especially keen on developing jet or aviation fuel with a bioethanol mix due to a European Union biofuel requirement which would require all aircraft flying into the EU to use lead-free fuel in the future, Agbon explained.

The PADCC expects to get some response from the US firms next month.