Biomass Energy in Philippines

8/3/2019 Biomass Energy in Philippines

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Biomass Energy in thePhilippines: Assessment and

Strategy Formulation

JESSIE C. ELAURIA, Ph.D.

Associate Professor &Project LeaderUP Los Banos


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PART I. ENERGY AND

ENVIRONMENT Fossil fuel reserves of the country

include:

proven oil reserve of 24.2 million m3

proven natural gas reserve of 3 trillion

m3, and proven coal reserves of 236 million M

tons


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Energy Consumption Total electricity generation capacity in the

country - 51.2 billion Kwh in 2003

61.9% thermal 15.8% hydro and

22.2% geothermal

Growth rate - 5.9% per annum between1999 and 2003

Total energy consumption was 1.18quadrillion Btu


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Carbon Emissions Energy-related carbon dioxide emissions

were 64.5 million tonnes (approximately

0.3% of world total) The share of CO2 emissions from fossil

fuels was

76.6% from oil, 17.0% from coal, and

6.4% from natural gas in 2002


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PART II. BIOMASS ENERGYIntroduction

Biomass energy is projected to playa major role in meeting worldenergy demand in the future

Promoting deployment anddiffusion of modern BETs - vital forharnessing the potential of biomass

energy in the Philippines


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PART II. BIOMASS ENERGYIntroduction

In 2002, the countrys total primaryenergy consumption was 254.4million barrels of fuel oil equivalent(MMBFOE)

Biomass, solar, and wind resourcescontributed a total of 31% of thetotal primary energy consumption


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Major Research

Activities/Objectives The present study was carried out

within the framework of the Biomass

Project of the ARRPEEC Phase III.

Major objectives of the study were to:

Characterise and assess selected BETs

Identify barriers to their introduction, andstrategies for overcoming them

Identify and analyse issues affecting

transfer of BETs


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CHARACTERISATION AND

ASSESSMENT OF SELECTED BETS This study selected three BETs on the

basis of numerous factors including:

diffusion potential

cost effectiveness

conformity with national developmentgoals, and

feasibility of local manufacturing


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CHARACTERISATION AND

ASSESSMENT OF SELECTED BETS

For the Philippines study, theselected technologies were:

Biomass-Fired Boiler for Power

Generation

Biogas System for CookingApplication

Improved Cooked Stove


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Generation The study considered a 2 MW

communal power plant,

Rice hull is first gasified and gas isburnt to produce steam for power

generation. Thermal efficiency - 12%, a

capacity factor - 80%, and a boiler

efficiency - 74%.


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Generation

The unit's total annual electricitygeneration is 12,996 MWh

47% of this is allocated to meet theelectricity demand of the participating ricemills while excess power will be sold to

the grid The payback period is approximately 3.5

years, with 23% internal rate of return


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Generation

The estimated technical potential couldincrease by as much as 52% from 1998

(102 MW) to 2001 (155 MW).

Compared to coal based powerproduction as a baseline (with a lower

cost per unit of power output), ricehull-fired facility is still not comparable.


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Benefits and CO2 Mitigation andEmissions:Biomass-Fired Boiler for Power

GenerationBenefits CO2Mitigation and Emissions

reduction in the volume ofwaste generation

reduction of the countrysdependence on imported fuel

reduction of foreign exchange

allocation to imported fuelreduction of the countrys

dependence on imported fuel

Compared with conventionalcoal based power generation (a600 MW plant with coalconsumption amounting

to 34,764 TJ/year), the

mitigation potential is 10kt of CO2 equivalent peryear.


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Biogas System for Cooking

Application The study considered a biogas system

with a 6 m3 fixed-dome type digester, a

2 m3 hydraulic tank, a 1.2 m3 mixingtank, and a 3 m3 gasholder.

Designed for a 30 head hog farm with

annual biogas production of 817 m3,which is equivalent to 16,340 MJ/year.


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Biogas System for Cooking

ApplicationAnnually, the system needs a total of

832 man-hours.

Internal rate of return is 138% giving apayback period of 1 year.

Estimated technical potential of biogasproduction from hog manure is 1.5 PJ in2002, with a projected potential of 1.9PJ in 2010.


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Benefits and CO2 Mitigation andEmissions:Biogas System

Benefits CO2 Mitigation andEmissions

Improved waste disposal

Reduced pressure onfuelwood

reduction of air, water, andland pollution

reduced reliance on fossilfuels

reduce kitchen-related

health hazards for women

and children

The annual greenhouse

gas (GHG) emissionmitigation potential of abiogas stove is 1.7 t CO2equivalent when used toreplace an LPG stove or3.1 t CO2 equivalent whenused to replace a kerosenestove


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Improved Domestic Stove:FPRDI Charcoal Stove

The study selected a charcoal stovedeveloped by the Forest Product

Research and Development Institute(FPRDI).

One of the few of the existing stoves in

the country that is considered highlyefficient.

Reported efficiency - 33%, the highest

of the available stoves


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Improved Domestic Stove:FPRDI Charcoal Stove

The stove consumes 0.6 kg charcoal per hourand operation is simple.

It has an annual heat generation of 2.970GJ, and its cost per unit of heat output is USD27.06/GJ.

The technical potential for the FPRDI stove is

3.314 million units. The FPRDI Stove costsUSD 3 which is much lower than the cost ofeither LPG or kerosene stoves.


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Benefits and CO2 Mitigation andEmissions:Improved Domestic Stove

Benefits CO2 Mitigation andEmissions

Address rural poverty alleviation by

more widespread use of the FPRDIStove

Reduce the amount of biomassused in cooking leaving it available

for other useful applications

Forest degradation could also bemitigated through more efficient useof fuelwood.

Annual GHG emission

mitigation potential of anFPRDI stove is 534 kg CO2when used to replace an LPGstove, or 990 kg CO2

equivalent when used toreplace a kerosene stove


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BARRIERS TO SELECTEDBETS

There are many barriers to expanding the useof modern BETs.

In order to analyse and address thesebarriers, they were ranked using AnalyticalHierarchy Process (AHP) methodology basedon the following criteria: Impact of removal

Ease of removal

Responses of researchers, manufacturers,policy personnel, and users were consideredin ranking barriers.


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Hierarchy for the ranking of barriers to selected BETs

.

BIOMASS-FIRED STEAM

BOILERS

1. High initial cost2. High adoption/ transaction cost3. Lack of financing/risk

coverage mechanism

4. Lack of local expertise(manufacturing, maintenance)

5. Lack of product standards6. Lack of coordination among

government agencies

7.

Lack of financial/fiscalincentives

8. Lack of access to information9. Subsidy to fossil fuel (bias

against BETs)

10.Lack of biomass feedstocksupply assurance

BIOGAS SYSTEMS

1. High adoption/ transactioncost

2. Lack of financing/riskcoverage mechanism

3. Lack of local expertise(manufacturing, maintenance)

4. Lack of product standards5. Lack of coordination among

government agencies

6. Lack of financial/fiscalincentives

7. Lack of access to information8. Subsidy to fossil fuel (bias

against BETs)

9. Lack of biomass feedstocksupply assurance

IMPROVED COOKSTOVES

1. High initial cost2. Lack of micro-credit

financing mechanism

3. Lack of assurance/performance standards

4. Lack of coordination amonggovernment agencies

5. Lack of localexpertise/skills/know-how

6. Subsidy to fossil fuel7. Lack of locally available high

performance stove

RANKING OF BARRIERS

IMPACT OF

BARRIER REMOVAL

EASE OF BARRIER

REMOVAL

Level 1: GOAL

Level 2: CRITERIA

Level 3: B

A

R

R

I

E

R

S


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STRATEGIES TO REMOVEBARRIERS AND PROMOTE BETs

The study proposed several policymeasures aimed at mitigating orremoving the perceived barriers tothe adoption of BETs.

Policies to address barriers wereexamined separately for eachtechnology.


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BARRIERS AND MEASURES:Biomass-Fired Boiler

BARRIER MEASURE1. Lack of product

standardFormulation of effective and

enforceable standardConduct testing and labelling of

system parts and components2. High initial cost Local manufacturing of system

parts

Concessional duty rates forimported units and parts

Attractive loan packages forenvironmentally sound system


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BARRIER MEASURE3. High adoption

or transaction

cost

Capacity development ofpotential investors and

developers4. Lack of accessto information

A one-stop-shop for processingof project documents, permits,

and clearances for easy

approval.

Formation of a RenewableEnergy Information Network

(REIN) with renewable energy

databases


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BARRIER MEASURE5. Lack of

financing orrisk coveragemechanism

Capacity development of financing

institutions related to renewableenergy projects.

Establishing dedicated fund for

renewable energy projects byfinancing institutions.


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BARRIERS ANDMEASURES: Biogas System

BARRIER MEASURE1. Lack of product

standardFormulation of effective and

enforceable standardConduct testing and labelling ofsystem

parts and components2. Lack of

financing orrisk coveragemechanism

Capacity development offinancing institutions in relationto renewable energy projects.

Financing institutions couldeven establish a dedicated fundfor renewable energy projects.


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BARRIERS ANDMEASURES: Biogas System

BARRIER MEASURE3. Lack of access to

informationA one-stop-shop for processing of

project documents, permits, andclearances to get projects approvedeasier.

A Renewable Energy InformationNetwork (REIN) with renewableenergy databases should be formed

4. High adoption or

transaction cost

Capacity development of potential

investors and developers5. Lack of localexpertise

Training programmes on design,operation and maintenance aspectsneed to be developed


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BARRIERS AND MEASURES:Improved Cooking Stoves

BARRIER MEASURE1. Lack of locally

available highperformance stoves

Incentives to manufacturers toencourage mass production

2. Lack of product

standard

Formulation of effective and

enforceable standardConduct testing and labelling of

system parts and components


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BARRIER MEASURE

3.Subsidy to

Fossil Fuel(Bias AgainstBETs)

Subsidies on fossil fuels

need to be rationalisedagainst the desire topromote BETs

Government may consider

providing equivalentsubsidies to the renewableenergy alternatives.


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BARRIER MEASURE4. High Adoption orTransaction Cost Use in income generatingactivities should be

encouragedUse of low cost indigenous

materialsIncentives to manufacturers to

encourage mass production

5.

Lack of LocalExpertise or Skillsand Know-How

Training programmes in orderto disseminate information ondesign, operation andmaintenance


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Key Strategies for PromotingSelected BETs in the Philippines

Government policies and incentives have created aframework favourable to the conventional systems

The promotion of BETs needs more than just policies

and incentives. It requires a framework of strategies meant not just

for energy delivery and access, but which supportsustainable development as well.

The study recommends the following key programsto address the barriers to the deployment of theselected BETs in Philippines.


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Capacity BuildingProgramme

Comprehensive learning andunderstanding among concerned

stakeholders of the sector. The capacity building programme can

be in the form of training, seminars,

workshops, technical assistance,conferences, consultations, meetingsand special activities.


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Information DisseminationProgramme

Comprehensive information on BETs,including

related government policies and incentives, current service providers, potential community and business users. Moreover, aim to encourage the target

stakeholders to seek more specializedinformation about BETs.

An effective information disseminationprogram through an appropriate publicawareness campaign.


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Renewable EnergyInformation Network (REIN)

Establishment of the REIN accompaniedby an Information Focal Centre (IFC),

acting as a hub for the dissemination ofinformation on RETs through the weband other media.

It should be a network of informationsources and should coordinate allinformation dissemination tasks.


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Financing MechanismProgramme

Accessible credit facilities will beprovided to potential borrowers bythis programme

Several schemes are recommended

including leasing programmes andmicro-credit financing.


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InstitutionalStrengthening Programme

Coordination among differentinstitutions and stakeholders can be

done by strengthening the existingRenewable Energy Network (REN)

Establishing a onestop window toassist in the processing of documents,permits and clearances for BETs.


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Policy Measures

In the form of productionincentives such as per-kilowatt-

hour payments or tax credits

Guaranteed power purchase

agreements at favourable rates


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TRANSFER OF SELECTED

BETS:Current Assessment

The Philippine Department of Energy'sprogrammes on New and RenewableEnergy and Power Development canstrongly support the development of NREresources

The DOE pursues continuous developmentand use of new and renewable energy asa strategy to attain energy self-sufficiencyand environmental protection.


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One major strategy of the Philippinegovernment under PEP 2003-2012 in ensuring

a stable and secure energy supply is toenhance utilisation of renewable energy.

It encourages private sector participationincluding foreign investment in the exploration

and utilisation of these energy resources, andin the manufacturing of renewable energysystems and components.


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The DOST is geared towards scientificand technological research and

development in all areas includingRETs.

DOSTs R&D institutes, the Forest

Products Research and DevelopmentInstitute (FPRDI), works on efficientutilization of forest-based biomass

resources.


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The DOSTs Industrial TechnologyDevelopment Institute (ITDI) is

engaged in adaptive R&D on new andadvanced energy conversiontechnologies.

Only DOSTs International TechnologyCooperation Unit (ITCU) is mandated tocarry out international technology

transfer activities.


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The country has numerous foreigndirect investment policies related to the

development of renewabletechnologies.

These policies work to make investment

attractive to private sector, and toextend fiscal incentives to renewableenergy operations.


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Barriers and measures tosuccessful transfer of BETs

Barriers Measures

1. Lack of Access toInformation

Enhance dissemination ofinformation on modern BETs,

including government policies andincentives regarding their transfer


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Barriers Measures2. Insufficient

Human andInstitutional

Capacities

The country's technology

absorption capacity needs to bedeveloped.

Existing technology infrastructure

should be strengthened byidentifying and remedying gaps inits existing capacity.


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Barriers Measures3. Financialand EconomicBarriers

The financial system and financial resourcesneed to be developed.

Pollution charges or taxes on fossil fuel

systems would raise the price of fossil-fuelenergy making BETs more competitive.Enforcement is key to enabling privatecompanies to switch to greener energytechnologies.

The government needs to raise both domestic

and foreign financial resources such ascommercial loans and Official DevelopmentAssistance (ODA) in order to direct financialsupport to BETs.


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Barriers Measures3. Financial

and EconomicBarriers

Government support can be in the form

of a venture capital and bridgingcapital, and long-term loan packageswith lower interest rates and flexibleamortization schedules.

There is also a need to mobilizegreater private sector participation interms of investment.


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Barriers Measures4. Trade and

Policy Barriers Pollution charges could help promote

technology transfer, as could voluntaryagreements between government and

private sector, product andperformance standards

Policy initiatives to attract privateinvestment in clean energy systemsare needed,

Environmental codes, intellectualproperty rights protection, and foreigndirect investment would alsoencourage technology transfer.


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Barriers Measures4. Trade and

Policy Barriers

Voluntary agreements between

government and private sectorregarding GHG emissionreductions should also be pursued.

Adopting international standards

such as ISO 14000, cansubstantially promote internationaltechnology transfer.


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Barriers Measures

5. InstitutionalLimitations

Technology transfer opportunitiesshould be pursued under the CleanDevelopment Mechanism (CDM).


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GENERAL CONCLUSIONS

The Biomass Energy Technologies examinedhave considerable potential to reduce GHGemissions in the Philippines.

All bring significant additional benefits interms of waste reduction, quality of lifeimprovements, and efficient use of existingbiomass resources.

Barriers do exist, but the long-term benefitsmore than offset the difficult task of removingthese barriers.


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GENERAL CONCLUSIONS

Existing policies must be revised or new and more favourable ones be

developed to encourage transfer of BETs and help address our dependence onimported fuel,

improve the living conditions ofour people and

mitigate climate change.

i l d


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Capacity Development andDissemination Activities

a. Publications The Philippines Recommends for Agricultural Waste

Processing and Management. Philippine Council forAgricultural, Forestry, and Natural ResourcesResearch and Development (PCARRD), Los Baos,Laguna. 2004.

The Philippines Pitches in to Contain Global Warming.University of the Philippines Los Baos HORIZON.Volume 5. No. 5. April 2003.

Experts Discuss Climate Change. University of thePhilippines Los Baos HORIZON. Volume 5. No. 4.March 2003.


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Papers presented

Sustainable Use of Biomass as Greenhouse GasMitigation Option in the Philippines. Paper presentedduring the Biomass Asia Workshop held on January19-21, 2005 at Tokyo and Tsukuba, Japan.

Potential and Status of Biomass Energy Technologiesin the Philippines. Paper presented during ForestProduct Research and Development Institute (FPRDI)Planning Workshop held at FPRDI Conference Room,FPRDI, Los Baos, Laguna on June 4-6, 2003.

Energy Security: Economic and Policy Implications.Paper presented during the Energy Forum held at UPDiliman on September 24, 2004


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Conferences/Workshop/

Seminars Attended:

Nine (9) international and localconferences/workshops attended

related to BETs- BiomassAsia Workshop held on

January 19-21, 2005 at Tokyo and

Tsukuba, Japan.


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Fellowship

First Annual Review and Final AnnualReview Workshops held at Asian

Institute of Technology Bangkok,Thailand.

Two project team members attended a

total of 4 man-month fellowship atAsian Institute of Technology Bangkok,Thailand.

N t ki /li k ith


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Networking/linkages withother research institutions

The Project Team continued to push the BiomassProgramme through the conduct of joint researcheswith other national research agencies.

The Team Leader worked with PCARRD as memberof their Agricultural Engineering RDE Network.

Participated in several workshops related to energyand is working with Southern Tagalog Council onEnergy and Industry Research and Development asRegional Technical Working Group Coordinator.

The team leader also worked with Bureau ofAgricultural Research of the Department ofAgriculture as AE RDE National


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Documents

Biomass Energy in Philippines