RP firms learn eco-friendly is also cost-efficient
MANILA, Philippines — Business companies in the country are starting to realize that it is more cost-efficient to be ecologically-friendly by taking advantage of a market-based mechanism created by the Kyoto Protocol.
Cement manufacturer Holcim Philippines, for instance, is now planning to use the clean fuel source ipa (rice husks), instead of the dirtier coal, for 15 percent of its power consumption, the firm’s assistant vice president and technical manager, Rosario Chan, told INQUIRER.net Monday.
Doing this would earn the cement manufacturer so-called carbon credits that, according to Douglas Russell, managing director of Natsource LLC, are now priced at between five and €12 per ton per year. Natsource is among the eight United Kingdom companies that are in the country to help local companies develop eco-friendly projects.
Chan said her company’s plan would reduce its carbon dioxide emissions by between 210,000 tons to 450,000 tons a year. In effect, Holcim, whose application is up for validation before the Department of Environment and Natural Resources (DENR), can sell from about €1 million to €2.25 million in carbon credits every year.
“We have submitted our project design document to the DENR and the DNV [Det Norske Veritas]),” an independent Norwegian risk management foundation, “for validation. If approved, this will be [the country’s] biggest CDM [Clean Development Mechanism] project so far,” she said.
According to the UK embassy, potential global revenues from carbon credits are estimated at $5 billion and are expected to increase to $40 billion by 2012.
Holcim was among the many Philippine companies that participated in the UK embassy-sponsored business seminar on Monday led by the UK Climate Change Projects Office (CCPO) and the UK Trade and Investment (UKTI). The seminar was participated in by representatives from Natsource, Tradition Financial Services, Trading Emissions PLC, CantorCO2e, Camco International, Ecoenergy, Ecosecurities Group Plc, and DNV.
The CDM, a market-based mechanism developed as part of the Kyoto Protocol, allows developed countries to make up for their greenhouse gas emissions by buying and selling carbon credits.
UK Ambassador to the Philippines Peter Beckingham explained: “The idea behind carbon trading is that putting a price on carbon, so that polluters pay the price of their emissions, is critical.”
Beckingham said the global carbon market, which is still in the development stage in the Philippines, can stimulate private investment in clean technology and energy efficiency.
“These markets, worth over €7.6 billion in 2005, can also generate enormous resource transfers to developing countries such as the Philippines through the CDM,” he added.
Various local companies have attended the business seminar “UK Technology and Finance for Clean Development Mechanism (CDM)” to learn how to address global warming and take advantage of the demand for “carbon currency.”
Da Fei Huang, of Trading Emissions Plc, said her company has so far invested $7 million in about 50 hog raisers in the Philippines to help them convert hog waste into energy. Right now, hog manure from these farms produces eight megawatts of power and is expected to increase output to 12 megawatts by next year.
She said the “highs” of her experience in this type of projects in the Philippines include the strong sustainability character of the projects, government support, successfully built long-term strategic partnership with local developers, growing awareness and interest from local financial institutions with local developers, participation of non-government organization, and because Filipinos are good communicators.
Huang said the “downs” are the relatively long lead time for host country approval, long lead time for due diligence and data collection, and more stringent requirements for biomass and methane recovery projects due to methodological changes.
“I see confidence in the Philippines continuing in the coming years,” she said.
The Philippine government recently announced that it is stepping up efforts to address climate change and take advantage of the demand for carbon currency.