E-trikes loan halted

See these news reports about this weird “more tricycles to save the planet” ADB loan.

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From the MB report,

“For the e-trike, I already cancelled the loan – supposedly the funding for 100,000 e-trikes. But for the 3,000 units, since bidding was done and units were already produced by the winning supplier, we’ll go ahead with that – so the canceled loan portion should just be for the 97,000 units,” he explained.

The energy department, under the past administration, had just been looking at a price point of R150,000 to R200,000 per e-trike, but unfortunately, the cost subsequently swelled to R250,000 per unit.

From Malaya ‘ too expensive’ report,

Last February, Bemac Electric Transportation Philippines Inc., a unit of Uzushio Electric Co. of Japan won the contract to build 3,000 electric trikes worth $30 million.

An e-trike costs $10,000 or P500,000 half of which is the cost of battery.

Ordinary tricycles cost from as low as P60,000 for second-hand units and upward from P150,000 for the better quality products.

The e-trike then costs three times more than the ordinary tricycle.

In comparison, new branded vehicles used in ferrying passengers start from P800,000 and they can be bought on instalment with low rates.

From Malaya ‘scaled down’ report,

This time, the e-trike project would involve only 3,000 units of e-trikes from the original plan of  100,000 and the cost is significantly slashed from P21.672 billion to P1.73 billion.

The e-trike project was part of the original $504 million e-vehicle project plan jointly funded by the ADB, the Clean Technology Fund (CTF) and the government as part of efforts to jumpstart the energy-efficient electric vehicles industry in the country by producing 100,000 units of electric vehicles.

From the $504 million, ADB was supposed to shoulder $300 million while CTF will provide $105 million and the remaining $99 million from the government.

From Philstar report,

In an annual audit report recently published on its website, the COA stated that as of Dec. 31, 2016, only P77,791,419.85 or 0.35 percent of the total project cost of P21.672 billion ($504 million) has been disbursed.

Of this disbursed amount, only P14,398,023.17 was allocated for project implementation activities, while P63,393,396.68 was for the payment of commitment charges and interests incurred due to the project’s delayed implementation.

The COA said the sustainability of the project is now “in jeopardy” as the cost per unit of the e-trikes has already increased from around P250,000 to currently around P455,000.

The COA pointed out that this would be “very costly for the local tricycle drivers who will be required to pay the same over a period of five years.”

In its reply letter, the DOE management informed the COA that the National Economic and Development Authority Investment Coordination Committee (NEDA-ICC) has approved the DOE’s request for the cancellation of at least $359.76 million worth of ADB loans for the E-Trike Project.

DOE Sec. Al Cusi made a good decision in cancelling a big portion of this very lousy, very costly project. We have to pay the commitment fee and save us nearly P21 B.

At P455k per e-trike, one cannot even go safely from QC to Las Pinas and back. If battery power runs out due to distance and traffic, there is nowhere to charge for at least 3 hours. Better buy a 2nd-hand car, good running condition with air-con, one can drive up to Baguio, Ilocos or Bicol and back safely.

This $400-M e-trikes loan to help ‘save the planet from fossil fuel’ is a stupid program. Its main function will only be to further expand institutional robbery via loans-then-taxes of Filipino taxpayers.

DOE not concurring with PH’s Paris agreement, good

Some PH Senators declared that the Senate will ratify the Paris Agreement of more expensive, unstable electricity “to save the planet” even if the DOE did not concur with it. Portion of the report said, “32 of the 33 agencies having already submitted their certificates of concurrence to Malacañang.”
(Phl to ratify Paris climate pact in July, Philippine Star, January 10, 2017)

The agency or department that did not concur with the PH (actually CCC) commitment to the Paris Agreement is the DOE, thanks Sec. Cusi.

“In the Cabinet, officially I have the only department that has not concurred in the ratification of the climate [pact].”

“I cannot concur on the ratification of the climate change [pact] because that can be used against DoE in approving the kind of power plants that we are going to have,” he said.

Mr. Cusi said the country’s pledge to cut carbon emissions by 70% means reaching a level that has already been met — in 2015.

“What does it mean? Wala na tayong gagawin [We can’t do anything],” he said, referring to curtailing the country’s development.”
(Energy department calls for foreign funding of global warming measures, BWorld, Dec. 12, 2016)

Many big countries like the US, Germany, UK, have not ratified their Paris commitment. Those who ratified are mostly small countries. $100 B a year of climate money transfer from developed to developing countries has become a huge extortion project that will produce huge disappointment from beggar countries. Almost ALL developed countries are already heavily indebted, they have huge public debts, don’t have enough money for their own citizens. And they will give away huge money to developing countries, many of whom are led by despots and corrupt leaders, will not happen.

The degree of climate extortion varies. While the “consensus” is $100 B a year starting 2020, some UN officials and planet saviours want $500 B a year. Less flood or no flood or more floods; less snow, no snow or more snow, that money should be given to them.

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As for energy prices, Meralco generation charges for Sept-Oct-Nov 2016 below. All these power plants are using coal and nat gas, except TMO, a peaking plant that uses oil. WESM prices are cheap, down to only P2.54/kWh last Nov. Which means FIT Allowance will be high so that pampered solar and wind plants at P8 to P10+ per kWh will remain “viable” through expensive electricity imposed on all energy consumers nationwide.

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Sec. Cusi’s energy realism should be supported against energy alarmism by other agencies and groups.

Christmas lights, energy mix and electricity production in Asia

* This is my article in BusinessWorld last December 21, 2016.

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The holiday season, among others, is marked by the presence of so many lighted streets, buildings, malls, and houses. These sparkling and glittering Christmas lights and decors — besides adding smiles and happiness — also indicate continuing and rising material prosperity of the Philippines and its cities.

The change in the energy mix policy by the Department of Energy (DoE) is better appreciated in this context. Not only do people want cheaper electricity, they also want 24/7 energy with no brownout even for one minute.

Below is a summary of the policies under resigned Secretary Carlos Jericho Petilla (November 2012-June 2015) then Acting Secretary Zenaida Monsada (July 2015-June 2016), and present Secretary Alfonso Cusi (see Table 1).

There are three important reasons why the Cusi formula of energy mix via system capacity makes more sense.

First and foremost is the price impact to electricity consumers. Forcing and mandating more natural gas, more solar-wind into the grid and the distribution utilities will mean even more expensive electricity and more unstable energy supply because of the intermittency, on-off nature of wind-solar.

Consider the feed in tariff allowance (FiT-All) for the variable REs: four centavos/kWh in 2015, 12.40 centavos/kWh in 2016, and 23 centavos/kWh in 2017 based on Transco petition for FiT-All hike at the Energy Regulatory Commission. The bulk of this rising FiT cost to consumers will go to wind and solar plants because they have the higher rates and higher installed capacity. The 23 centavos is on the assumption that it will be granted by the ERC by January 2017. Further delays for few months will mean more under-recoveries and hence, higher rate of 25 centavos-28 centavos by 2017.

Second, our current power capacity and actual electricity production remains small compared to our more economically significant neighbors in the region, and our coal consumption is also way small compared to their coal use. It is not wise to further restrict our baseload power capacity if we aim to sustain fast economic growth into the next decades to come.

Brunei, Myanmar, and Cambodia are excluded from this list because of their small electricity production (see Table 2).

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Third, the “more renewables to save the planet” argument does not hold water until now. Proof? Whenever I am engaged in a climate and energy debate with various groups and individuals who insist on the anthropogenic or “man-made” global warming/climate change (CC) hypothesis, I ask these two questions:

  1. Of planet Earth’s 4.6 billion years age, when was the time, what period, that there was NO climate change?
  1. What was it like before this “man-made” warming — less rain, no rain, more rains? Less flood, no flood, more floods? Less snow, no snow, more snow? Please cite scientific sources for your two answers above.

One hundred percent of the time, their answer is the sound of silence. Or they will put various links, various reasons, and alibis but none of which answer directly any of the two questions. Which shows that the anthropogenic climate change argument remains shaky and questionable. Even the UN IPCC literatures do not discuss paleo-climate data dating back to millions of years ago. This is because planet Earth’s climate history is characterized by natural climate cycle of warming-cooling, with or without humans and their malls, cars, airplanes and coal power plants.

Mandating “more renewables to save the planet” will only succeed in making the country less developed, since electricity will become costly and supply unstable. Big energy-intensive manufacturing plants and foreign investments would rather locate in Vietnam, Thailand, Malaysia and Indonesia, countries with cheaper electricity and more stable, brownouts-proof energy supply, then export huge volume to the Philippines at zero tariff under the ASEAN Economic Community (AEC).

Of the many Cabinet Secretaries of the Duterte administration, DoE Secretary Cusi is among those standing tall. His energy realism (not alarmism) policies of “appropriate energy mix should be decided by the consumers, not by government” is a market- and growth-friendly philosophy.