Sunday, February 13, 2011

Energy rationing 1: Energy Loans and Climate Alarmism

A fellow UPSE alumni, a BusinessWorld columnist, former DOF UnderSecretary, Romy Bernardo, wrote in one of his BW columns, Renewable Energy-- reality check . He wrote,

The Philippine Renewable Energy Law passed in 2008 has been applauded by environmental groups, renewable energy firms, and official donor institutions keen to play a role in addressing global warming. We who pay taxes and high energy bills need to be a little more wary.

My attention was caught by a news article reporting a billion dollar renewable energy loan program being negotiated between the Asian Development Bank, other official co-financiers, and the Philippine government. The news item said that “most of the $ 1 billion loan will be focused on supporting solar, wind and biomass power projects”. I hope this is inaccurate, and that most of the funding goes to sound components of the program like raising consumer awareness on energy efficiency and regulation for energy efficient equipment and appliances, instead of subsidizing inefficient technologies.

The hard reality is that the technology for these three sources is far from mature as seen in their exceedingly high price: solar costs P 25 per kWh, biomass and wind around P 10. This compares very poorly with the current grid rate of P 4.50 per kWh-- anywhere from two to five times true cost now.

So who will carry the high cost of these immature technologies? Answer: Feed In Tariffs (FIT). An add-on, a tax if you will, to the average cost of power in the grid for everybody. The law obliges the power industry participants to source electricity from generation at a guaranteed price applicable for a given period of time but no less than 12 years, supposedly to accelerate the development specifically of emerging RE resources. This cost to the public is on top of the tax gives the Renewable Energy Law provides developers, including income tax holidays for 7 years, duty free importation of renewable energy machinery, equipment, material for 10 years, special realty tax rates, etc.

The FIT provisions seem to have been adopted from laws in developed European countries, meant to subsidize emerging technologies by burying it in the general public’s power bill. The FIT number floating around in discussions for the Philippines is fifteen centavos add on per kwh used by each consumer. This amount may seem small, until one considers that this is an add-on to one of the highest per kWh cost of power in the region, arising from our archipelagic geography, and legacy/stranded costs.

Moreover, this fifteen centavos translates into a P 10 billion ANNUAL subsidy, hardly the best use of money for a country that has huge social and basic infrastructure requirements.

Last January 16, 2011, I wrote in Climate stupidity, part 6

...The climate loans racket is terrible. According to one news report last August, Billion dollar loans for climate change ‘unjust’, data from the Environmental Management Bureau (EMB) showed that Philippine loans for climate adaptation was $586.59 million, plus loans for climate mitigation of $491.64 million, for a total climate loans of $1.078 billion!!

For me, this climate loans racket is horrendous. The government is contracting loans left and right, to be paid from our current and future taxes and fees, to fight a non-existent enemy. Only the debt-pushers (not much different from the drug pushers) from the foreign aid establishment like the WB and ADB, the various climate officials and bureaucrats from local to national government, the beneficiary environmental NGOs, benefited from this huge debt.

So with $1+ billion of outstanding climate loans, Romy B said there's another $1B of future energy loans. What for, "to save the planet"? Or to save the perks and idiocy of the warming fanatics?

The Renewable Energy Commission is among the new bureaucracies created by the warming scam. The bigger bureaucracy that was newly created is the Climate Change Commission (CCC). These guys travel big time in global climate meetings -- like during the Copenhagen UN FCCC meeting in December 2009, then the Cancun meeting in Dec. 2010. FCCC also held several hold bi-monthly meetings prior to Copenhagen and Cancun.

I challenge the ADB-WB-other climate loans racketer -- Will you also be a coward if I challenge you to a public debate on the warming scam?

I asked that question because of two things.

One, about 2 years ago, UP School of Economics (UPSE) and PDE held a forum at the school, the speakers were the chief economist of ADB I think, and someone from the Carbon Finance Solutions (CAFIS). Dean Noel de Dios even gave the opening remarks. During the open forum, I asked those 2 speakers that their programs and solutions are based on wrong science, that there is no "man-made warming", that the planet simply experiences a regular, natural climate cycle of warming-cooling-warming-cooling, that there were periods in the past which were warmer than the past century's warming where there were no SUV, not even bicycles.

And what did those 2 gentlemen reply? That they are not scientists and the climate science is settled already (by whom, by Al Gore and the IPCC?). In short, they ducked when I was precisely challenging them to a debate.

Two, I have challenged many warming fanatics in this country -- Oxfam, World Wildlife Fund, Greenpeace, other alarmists - to a public debate. The response is uniform: silence of the lamb. I even questioned chief climate negotiator Tony La Vina in a UP College of Law forum last year, he also said that he is no scientist. From time to time, I would challenge him in facebook on climate, he would not reply.

The last time I wrote in his wall, I asked who are the guys who joined the Cancun meeting, from what agencies, in the spirit of "Freedom of Information". He responded by defriending me in fb.

I have already hypothesized several months ago, that ALL warming groups and fantics in this country are coward, no exception. I still wish to be proven wrong, that there are brave defenders of the man-made warming hypothsis.

Meanwhile, climate alarmism will make our energy cost even more expensive.

If this is not large-scale legalized robbery, what is it?

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