Transcript ISSUES IN IMPLEMENTING RURAL POWER PROJECT

RURAL POWER PROJECT
SOLAR PV
SUBCOMPONENT
Gabriel S. Zamudio
PV Manager, RPP-PMO
Barangay Electrification Situationer
(As of 31 May 2006)
LUZON
19,884
--------- = 97.11%
20,476
592
Unelectrified
Barangays
VISAYAS
10,926
--------- = 95.48%
11,443
PHILIPPINES
39,445
--------- = 94.04%
41,945
41,945
Potential Barangays
Based on 2000 NCSO
517
Unelectrified Barangays
MINDANAO
8,635
--------- = 86.13%
10,026
2,500
Unelectrified Barangays
1,391
Unelectrified Barangays
Solar PV Systems will be used for
most of these barangays.
Rural Power Project

Goal


Support the implementation of
reforms and priority investments in
rural power sector.
Objectives



To achieve increased access to
electricity services.
To support transformation of ECs
into more viable and competitive
commercial entities.
Increase use of renewable energy.
Solar PV Subcomponent: Overview

Involves the commercial
dissemination of PV systems for
single homes, establishments
and community applications thru
PCs and MFIs;

Provision of GEF grants and
government subsidies to develop
the market and buy-down cost of
PV systems;

Line of credit at DBP and PCFC
will be made available for MFIs
retail lending operation to finance
HHs acquisition of solar PV
systems;

Provision of TA and market
development support.
DOE Accredited Companies
Company
1. Solar Electric Company
2. Shell Solar Philippines
3. World Water Philippines
4. Edward Marcs Philippines
5. Gen Diesel Philippines
6. Center for the Advancement and
Utilization of Sustainable Energy
7. Dumalag Corporation
Contact Information
Mr. Robert Puckett, President
Tel No. (02) 724-4814
Mr. Ramin Nadimi, President
Tel No. (02) 816-6069
Mr. John Herrman, President
Tel. No. (02) 631-2673
Mr. Andres Cruz, Manager
Tel No. (02) 922-1371
Mr. T. R. Mojan, President
Tel No. (02) 892-3956
Mr. Ferdinand Larona, Executive
Director
Tel. No. (02) 656-7966
Mr. Abner Franco, President
Tel. No. (02) 805-3227
“DOE is still looking for more companies and other distribution channels.”
Participating MFIs
 TAYTAY
SA KAUSWAGAN INC. (TSKI)
Cooperative Bank of Palawan (CBP)
 Center for Agriculture and Rural Development
(CARD)
 Negros Women for Tomorrow’s Foundation
 People’s Bank of CARAGA
 Progressive Bank
 Green Bank

TSKI is a PIONEER in the Solar PV Lending
Program with at least 1,000 systems or
households financed thus far.
Output-Based Grants/Subsidies for PV

GEF Financial Incentives




10 – 50 Wp systems = US $2.50 per Wp
> 50 – up to 100 Wp = US $1.50 per Wp
Community Systems = US$1.50 per Wp up to $450
Government Subsidy


20 – 30 Wp systems =
>30 - 50 Wp systems =
Php 8,000 per system
Php 4,000 per system
WHY SOLAR PV?


Least cost
solution to basic
electricity
services for most
households
remote from the
grid
For lighting,
communications
and other
household/
community needs
Schematic of SHS
What Does the Family Get?
A cleaner source of energy and more of it
 A 20 Wp system generates electricity for:

2 light bulbs
 Operates the transistor radio
 Charges the mobile phone

Kids have much more time for homework
 An improvement in general health indicators

Example of PV System
System Size Current Price
Price after
Subsidy
20 Wp
P18,000 to
P10,000 to
P20,000
P12,000
Service: 2 lights + small radio or 3 lights
Debt Servicing
Price: P12,000
18% interest
24% interest
2 years
3 years
P493
(20% dp) P440
P508
P452
P328
P292
P338
P300
(10% dp)
Financing PV Systems: Business Model
LGF
Buy-back
Agreement
Vendor
Insurance
Policy
MFI
Sale/Warranty
Agreement
Funding
Agreement
DBP
Lease-to-Own
Contract
Household/
Rural
Business
SSMP Approach

Clustering of barangays into
viable packages

Baseload from community
facilities (ex. barangay halls,
health facilities, schools, public
lighting)

Subsidies to improve
affordability using the RPP
Program

Focus on after-sales service &
continued marketing

Competitive selection of SSMP
Operator
Project ACCESS: Pilot SSMP

Mirant Foundation Philippines will finance contract
cost for 55 barangays

Aklan, Masbate, Northern Samar and Palawan

ILPI – 2 barangays in Iligan City

AMORE – 21 barangays in Zamboanga del Sur and
Zamboanga del Norte
TSKI is DOE and Mirant’s partner for the Project ACCESS
6 AUGUST 2006
Obligations of Contractors



Supply and installation. Supply and install PV systems in public
facilities;
Maintenance. Provide maintenance services for at least five (5)
years
Marketing. Commercially market, sell and install PV systems in
minimum number of HHs within a stipulated period (e.g., 30 systems or
25% of barangay HHs, whichever is larger, within 12 months)
To ensure contractor’s compliance in the Contract, there will be a tough
performance bond requirement – 45% of the contract value
Market Development Support Facility (MDSF)

Cost-shared grants, max 50%, to support specific
activities such as training and TAs:



Financial management, contract management,
accounting and auditing;
Marketing (surveys, promotion, small demonstrations)
and business development;
Market entry cost;

Eligible beneficiary is entitled for an annual
allocation of Php500,000.00.

MFIs with existing partnership with accredited PCs
can access the facility
MDSF Grant Availment Procedure
Start
PC/MFI submits proposal
to DOE-PMO
 MDSF Proposal Form
 PV Company must be
accredited by DOE
(MOA)
 MFI must have MOU
with at least one PCs
DOE-PMO evaluates
proposals
 Form is available at RPP
website
(www.doe.gov.ph )
WB “No Objection”
 For the 1st applications of
eligible organization
DOE-PMO and PC/MFI
sign MOA
Release of first payment
 First payment – 50%
 Last payment – after
liquidation
Loan Guarantee Fund
 US$
1.0 million guarantee fund to
partially cover loan losses incurred in the
provision of loan to RET purchasers and
suppliers
 Portfolio
type guarantee for lending
operation by MFIs
For further information:
RPP-PMO
Tel No. (02)840-2252
www.rpp.com.ph
THANK YOU!