ENERGY EFFICIENCY USING
SOLAR AIRCON IN THE
PHILIPPINES
Inter-regional Workshop on Energy Efficiency
Investment Project Pipeline
UNCC, Bangkok, Thailand April 23-24, 2014
Presented by : Felix Richard A. Cordova, President & CEO
Maria Miranda C. Cordova, EVP & COO
Location of the Philippines
REPUBLIC ACT 9513 Renewable Energy Act of 2008
AN ACT PROMOTING THE DEVELOPMENT, UTILIZATION
AND COMMERCIALIZATION OF RENEWABLE ENERGY
RESOURCES AND FOR OTHER PURPOSES
RE TYPE SOLAR WIND BIOMASS RIVER HYDRO
PROPOSED FIT RATE (Peso) 17.95 10.37 7.00 6.15
APPROVED FIT RATE (Peso) 9.68 8.53 6.63 5.90
TARGET MW IN 3YRS 50 MW 200 MW 250 MW 250 MW
FEED-IN TARIFF IN PHILIPPINES
No Approved rate for Ocean energy, but target installation was set at 50MW
Note : Average power rate in the Philippines is Ps 12.00 or 0.28 USD per kwhr
1.Regulatory delays in the implementation of the
law
2.FIT rates are lower than proposed rates
3.Limiting target installation vs service contracts
already awarded
4.Huge risk on the part of RE developers which is
required to put up the plant first before FIT
awarding
5.Uncertainty with regards to FIT payment and
unclear collection guidelines
Challenges of RE in Philippines:
ENERGY EFFICIENCY & CONSERVATION POLICIES
ADMINISTRATIVE ORDER NO. 110 - DIRECTING THE INSTITUTIONALIZATION OF A
GOVERNMENT ENERGY
The Government shall aim to reduce its monthly consumption of electricity (in kilowatt-hours) and
petroleum products (in liters) by at least ten percent (10%)
EXECUTIVE ORDER NO. 123 (September 8, 1993) INSTITUTIONALIZING THE COMMITTEE ON
POWER CONSERVATION AND DEMAND MANAGEMENT
The Committee on Power Conservation and Demand Management, hereinafter referred to as the
Committee, is hereby established as a regular and permanent body with the Chairman of the Council of
Advisers on Energy Affairs as its Chairman and at least one representative from each of the following
agencies as members: Department of Energy; Department of Education, Culture, and Sports;
Department of Trade and Industry; Department of Interior and Local Government; Department of Labour
and Employment; Metro Manila Authority; National Power Corporation; Philippine National Oil
Corporation and the National Electrification Administration.
EXECUTIVE ORDER NO. 472 – Institutionalizing the Committee on Fuel conservation and
Efficiency in Road Transport signed on 25 March 1998. It aims to disseminate information on
efficiency utilization of fuel through the local chapters created for the purpose. The program targets a
10% reduction in fuel consumption.
DEPARTMENT CIRCULAR – 93-03-05
To all Industrial, Commercial and Transport Sectors: Establishments consuming 1 million LOE annually
are required to submit Quarterly Energy Consumption Report (QECR) to DOE. In addition,
establishments consuming 2 million LOE, apart from the QECR are required to submit an Annual Energy
Conservation Program Report (AECPR)
SENATE BILL NO. : 3321
Introduced by: HON. SERGIO R. OSMEÑA
ENERGY EFFICIENCY AND CONSERVATION ACT OF 2012
(Filed November 5, 2012)
“AN ACT INSTITUTIONALIZING ENERGY EFFICIENCY AND CONSERVATION, ENHANCING THE
EFFICIENT USE OF ENERGY, AND GRANTING INCENTIVES TO ENERGY EFFICIENCY AND
CONSERVATION PROJECTS, AND FOR OTHER PURPOSES”.
SENATE BILL NO. :2027
Introduced by: HON. EDGARDO J. ANGARA
ENERGY EFFICIENCY AND CONSERVATION ACT OF 2010
AN ACT PROMOTING THE ENHANCEMENT OF ENERGY EFFICIENCY AND CONSERVATION
THROUGH THE DEVELOPMENT OF ENERGY EFFICIENT TECHNOLOGIES, STRENGTHENING
ORGANIZATIONAL RELATIONSHIPS AND REINFORCEMENT OF RELATED LAWS
AND OTHER STATUTORY PROVISIONS ON ENERGY.
SENATE BILL NO.: 1602
Introduced by: HON. MIRIAM DEFENSOR SANTIAGO
AN ACT TO SUPPORT THE RESEARCH AND DEVELOPMENT OF NEW INDUSTRIAL PROCESSES
AND TECHNOLOGIES THAT OPTIMIZE ENERGY EFFICIENCY AND ENVIRONMENTAL
PERFORMANCE, UTILIZE DIVERSE SOURCES OF ENERGY , AND INCREASE ECONOMIC
COMPETITIVENESS.
ENERGY EFFICIENCY BILLS PENDING IN SENATE
ANOTHER INNOVATION IN SOLAR THERMAL
AND AIR CONDITIONING TECHNOLOGY…..
SOLAR-ASSISTED AIRCON SAVE 30 –50% ON POWER
SPLIT TYPE AC SYSTEMS
PARTIAL LIST OF CLIENTS
CEBU IWAKAMI
CORPORATION GTZ – DENR OFFICE
POWER CONSUMPTION COMPARATIVE STUDY
( CONDUCTED BY A TELECOM COMPANY)
SCOPE OF STUDY
• Temp Setting at 22degrees C
• Conducted in 15 days
ACTUAL DATA (15 DAYS OBSERVATION)
AC TYPE AVE.LOAD CURRENT
AVE. VOLTAGE READING
OPERATION STARTED OPERATION ENDED
DATE TIME INITIAL
READING DATE TIME
INITIAL READING
BRANDX (3TR, CS)
17.72 233 4-
AUG-11
2:30PM 2111 19-
AUG-11
2:30PM 3367.5
SEDNA AIRE
(3TR, CS) 11.57 233
20-AUG-
11 3:10PM 3396.9
4-SEPT
-11 3:10PM 4122.2
1256.5
725.3
0
200
400
600
800
1000
1200
1400
BRAND XX (Conv. AC) SEDNA AIRE
KW
H
Actual KWH Consumption
$AVE: 531.2 KWH/15days
or 1,062KWH/month Or 42%
ENERGY COST
1,062KWH/month x PHP12/KWH
PHP12,744
COST of Sedna Aire 3TR PHP 185,000
185,000÷12,744
14.5months
RETURN ON INVESTMENT
THE BUSINESS POTENTIAL FOR SOLAR AIRCON:
REPLACEMENT OF OLD 3 TONNER UNITS IN THE
PHILIPPINES
MILLION
APPROXIMATE COST TO REPLACE
Ps 185,000 x 3M = Ps 555,000,000,000.00 or
OLD UNITS WHICH ARE
CONVENTIONAL AIRCON INSTALLED
IN THE PHILIPPINES 3
(Project cost)
USD 12.6B
POTENTIAL
ENERGY
SAVINGS
1,062KWHRS X 3M
With 3M Units
3.18B KWHRS/MO
POTENTIAL MARKET:
ONLY 40,000 3Million
TARGET:
99%
1%
Potential
Target
TARGET in Years 5 40,000 units 3TR x $4,204.54/unit
USD 168.1M
$168M
Leasing? We get leasing lines from banks for 3yrs.
And offer subleasing to clients for 5-6 yrs
with O & M contract
FINANCING AVAILABLE
SUSTAINABLE ENERGY
FINANCE
Solar Aircon - Success Factors
1. The Philippines is a tropical country enjoying the sun in most
parts of the year
2. The electricity tariff is among the highest in the region (at Php
12 or .28USD for residential and small commercial)
3. As much as 50% of energy cost is used for cooling purposes,
not only in households but across industries in commercial
and industrial nature
4. The public awareness on climate change is high especially
with the series of unprecedented natural disasters in recent
months
5. Solar aircon is energy efficient at the same time renewable
energy
6. Increasing acceptance among users since its introduction in
2009
7. Promotes demand side management by reducing large portion
of energy used for cooling
8. Reduces CO2 production
Solar Aircon – Barriers
1. Solar Thermal technology was not considered in RE
law, hence not covered by incentive
2. New technology means “wait-and-see” attitude among
prospective clients although installations are working
since 2009
3. Mainstream market acceptability
4. Everything is imported, we don’t own the technology.
5. High Upfront Cost
6. No available 3rd party testing facility for Solar Aircon
7. Promotion of the technology lacks government
support
8. High Cost of Financing
9. 100% of risks is borne by the project developer since
we get leasing from the bank
WAY FORWARD ….
• Establish ESCO Company
• Establish local assembly
• Strengthen technical capability
• Source low cost financing
www,edwardmarcsphil.com
Manila : +632 9112371; +632 9221658
Cebu : +6332 2381972; +63325120684
Davao : +6382 2962907; +6382 2862162
Web : www.edwardmarcsphilinc.com
Email : [email protected]
THANK YOU FOR YOUR ATTENTION