World Bank okays USD 67-M grant for PH’s renewable energy projects

by Philippines News Agency – May 13, 2016

from Manila Bulletin

Two renewable energy-related projects totaling to USD 67 million have been approved by the World Bank (WB) for the Philippines.
In a statement, the multilateral lender said its Executive Directors have approved a USD 44 million guarantee under the Philippines Renewable Energy Project (PhRED) to lessen risks of commercial lending to electric cooperatives.

“This guarantee will enable these cooperatives to expand their electricity network, invest in renewable energy like small hydroelectric and solar power plants, and expand electricity access for poor households,” it said.

The other project, worth USD23 million, was approved by WB Vice President Victoria Kwakwa on April 28, 2016 for the Access to Sustainable Energy Project (ASEP).

The fund will be used to “bring solar power to remote communities and islands not connected to the electricity grid managed by electric cooperatives.”

WB Country Director for the Philippines Mara K. Warwick said these projects can boost the country’s energy sector, further solidify economic growth, and help cut emissions of greenhouse gases that contribute to climate change.

“Having electricity in the remote areas of the country means that children will be able to study their lessons at night and their parents can also have more opportunities to earn money from entrepreneurial activities,” she said citing that “initiatives like these can help address poverty and promote shared prosperity.”

Energy Secretary Zenaida Monzada said these projects are great boosts to the government’s full-electrification bid by 2020 and to triple the renewable energy (RE) installed capacity by 2030.

She said electric cooperatives account for more than 50 percent of power distribution in the country.

“The Government provides electrification grants to the electric cooperatives, but these cover only a portion of overall investment needs. Commercial loans are essential for strengthening electricity distribution networks, and banks look to the guarantee provided by PhRED to help manage their risks in providing significant funding amounts to the sector,” she said.

She noted that inflation “ASEP complements grid electrification by investing in solar home systems.”

”This will allow electric cooperatives meet their electrification targets in a more viable fashion by enabling them to avoid uneconomic line extensions while still providing electricity to remote, poor households,” she added.