Palawan, a province in the Philippines known for its pristine beaches, clear waters, and natural wonders, is taking a step further in becoming the most sustainable island in the world.
WEnergy Global, jointly with Maharlika Clean Power Holdings and Clean Grid Partners, collectively referred to as the Maharlika Consortium, through their Special Purpose Vehicle, Archipelago Renewables Corporation, has signed a Qualified Third Party (QTP) Service Contract to energise over 7,100 households and 300 small local businesses through 16 microgrids spread over 14 barangays in seven municipalities across the service area of the Palawan Electric Cooperative (PALECO) in Palawan.
The Consortium emerged as the winner of the recently concluded QTP tender of PALECO to support its mandate for total rural electrification in the province, meeting the stringent eligibility and renewable energy smart microgrid capability requirements set by PALECO and the Department of Energy (DOE) in a competitive selection process.
It will be replicating WEnergy Global’s award-winning flagship microgrid in varying sizes of microgrids, which has been providing 24/7 electricity to the households and businesses of Barangay Cabayugan, home to the Puerto Princesa Underground River, a UNESCO World Heritage Site and one of the New7Wonders of Nature.
Engaging the private sector in rural off-grid electrification
“This tender is unique for the Philippines. It is the first time in history that smart and clean microgrids have been packaged for a competitive selection process. It clearly demonstrates the urgency with which DOE, NEA and PALECO are enabling private sector engagement in rural off-grid and clean electrification. The Philippines still has over 10 million people with unmet access to electricity,” said Quintin Pastrana, President of Maharlika Clean Power Holdings, Inc.
“The best technology to electrify the community and boost their productivity for the best tariffs and the lowest reliance on subsidies and dependency on fossil fuels was selected. With this milestone, we can provide clean, reliable, and affordable energy to empower individuals, families, and enterprises in remote communities across Palawan,” he continued.
“The Consortium Partners were selected by PALECO through our Bids and Awards Committee and approved by our Board of Directors, because of their high-quality proposal, compliance, responsible ownership of off-grid power infrastructure, and excellence in planning, design, engineering, and technology selection, which are commercially viable and with the highest levels of social impact. They have also met the highest standards of clean power supply, transmission, distribution, and smart billing and collection services provided to households and businesses to support our mandate of total rural electrification in Palawan,” said Jeffrey Y. Tan-Endriga, Chairman of PALECO.
Filling the gap in Southeast Asia’s clean energy demand
Southeast Asia’s energy demand is among the highest in the world, growing by as much as 80 per cent in the last two decades. It remains heavily reliant on fossil fuels, with coal, diesel and natural gas supplying 75 per cent of the region’s electricity. However, approximately 100 million residents in the region still do not have access to electricity.
While the Association of Southeast Asian Nations has an articulated target of 23 per cent renewable energy in its total primary energy supply by 2025, the region must overcome funding challenges, including limited private sector funding.
“Investors need to consider financing smart microgrids and build the right capacity within their institutions to understand such new types of infrastructure. Right now they don’t, hence they stay away and go back to business as usual. This includes IFC, ADB, FMO and commercial banks. A few local banks are working on such deals and they take a constructive and learning approach, which is essential. Because, Not only do microgrids facilitate access to electricity of rural communities, they also enable genuine sustainable development and resilience at the community level. The microgrids that we develop can be easily scaled and replicated,” stated Atem Ramsundersingh, CEO and Board Director of WEnergy Global.
“Considering the unmet need across Southeast Asia, most especially in archipelagic countries such as the Philippines and Indonesia, private sector financing must be mobilised to meet the region’s SDGs beyond the level of just renaming existing old funds to be ‘ESG grade’.”
Powering rural communities through smart microgrids also makes financial sense for the Philippine government, especially at a time of volatility and uncertainty.
“The renewable energy in the grid mix is helping the government save PHP 7 million of subsidies from the Missionary Electrification Fund every year, which, for example, in a period of 10 years would be an equivalent of electrifying 1,000 households. Compared with traditional diesel-powered systems, this infrastructure will save more than 1.1 million litres of diesel fuel being burned per year, enhancing the energy security of Palawan and the Philippines in general in these times of huge market volatilities. The remarkable leaders and proud citizens of Palawan elevate the province as a leader in clean energy to affirm its recognition as a UNESCO Biosphere Reserve,” added Ramsundersingh.
Fostering local development and uplifting living standards
The total investment to be made by the Consortium is estimated at PHP 1 billion (USD 18 million) to build a distribution network, consisting of approximately 175 km of primary and secondary power lines, that is energised by 3,800 kWp solar PV, 2,000 kW diesel generators, and batteries with a total capacity of 4,200 kWh.
“A true example of decentralised electrification is powered by more than 50 per cent solar PV energy over its lifetime. Using smart technologies and monitored in real-time through satellite communications, these systems will produce stable quality of electricity in terms of voltage, current and frequency at an affordable cost,” said Fabian Weber, Director of System Design & Technologies with WEnergy Global.
“We believe in decentralised and smart microgrids because it is empowering communities with locally available renewable energy. Every family will be able to use electrical appliances and machines, including e- vehicles, and increase their income levels. Children will be able to study via online education. There will be continuity in healthcare services, including vaccinations during pandemics. Basic services such as street lighting to increase safety and security can now be provided on a 24/7 basis. Palawan communities can now demonstrate the greenest lifestyles,” said Ochi Takaki, Board Director of CleanGrid Partners.
This development also affirms initiatives being taken to achieve sustainable development in Palawan.
“This is a firm, positive step that supports the Philippines’ commitment to the Sustainable Development Goals, especially Access to Affordable, Clean Energy and Climate Action. The Maharlika Consortium’s investment and operations will provide a catalyst to greater business and economic activity in our beloved home province. Beyond an increase in tourism investments and arrivals, the electricity infrastructure will spur the creation of more enterprises to improve the standard of living of Palaweños and make Palawan a true model for inclusive, sustainable development” said Dennis Socrates, Governor of Palawan.