Shell to pursue internal RE projects in Philippines

MANILA, Philippines —  The Philippine unit of energy giant Royal Dutch Shell remains committed in pursuing renewable energy developments in the country through internal and corporate social responsibility (CSR) projects.

This, as the local unit puts the development of commercial-scale renewable energy projects on the backburner due to market congestion and the issue of foreign ownership, Shell country manager Cesar Romero said.

“We found it a bit challenging, first, because of the nationality requirement in being an RE company. And we noticed when we are doing our market scouting, the market is already quite crowded with regards to RE opportunities in solar panels,” he said.

The Shell country manager said the challenges include finding a local partner and the competitive edge in launching a new local business.

“We need a 60 percent Filipino partner, that’s one. And number two, because of our prudence on how we deploy our businesses, we want to make sure we have a unique distinctive competitive advantage. If you think about it, there are already a number of solar power installers that we don’t see anything unique for us to offer,” Romero said.

In May 2016, Royal Dutch Shell embarked on a new direction by forming a separate division, New Energies, to invest in renewables for a future beyond fossil fuels amid technological changes and climate change policies.

Following the group’s global thrust to go beyond fossil fuels, Shell’s Philippine unit has started to scout for opportunities in the renewable energy sector.

It has been scouting for potential partners to put up its renewable energy unit to comply with the 60 percent nationality requirement, however, nothing has progressed.

In order to continue its thrust to provide cleaner energy, Shell Philippines is concentrating on energy efficiency measures within the group instead of creating a new business unit for it, Romero said.

“We have 33 sites now that are (running on) on solar (power) and over and above that is our investments in energy solutions,” he said.

“So when we did our study, we noticed there’s still a lot to be accomplished internally first before we start marketing these products,” the company official said.

Currently, Shell Philippines is looking at deploying more renewable energy projects internally, particularly in its refinery in Tabangao, Batangas.

“For our refinery as well, we are considering how we can deploy again solar for own use (but) this is under evaluation. Those kind of energy solutions from within first. There’s a lot of opportunities to do renewable energy within the family first,” Romero said.

Meanwhile, Shell Philippines is also exploring more areas for its access-to-energy programs using renewable energy, like what it did in several far-flung locations in Puerto Princesa.

At the moment, our priority are the difficult-to-reach areas. Communities that are not in the five-year masterplan of government, those are the ones we choose to help (because these are in) close proximity in our operations,” Romero said.

Currently, Pilipinas Shell Petroleum Corp. has five sites under various hybrid modes.

By the end of the year, Shell Philippines will evaluate its progress and determine how it will move forward, Romero said.

“I think we will take stock at the end of the year depending on our experience with internal deployment. We did the right thing because, internally within Shell, we can already do a lot of things in terms of renewable energy solutions that you don’t have to worry about having a partner, or how do you sell this and the like,” he said.