March 11, 2007

Special Feature

Giving rural folks their due
Finally, a road map for rural power development

For almost half a century, rural electrification has moved ever so slowly. Not even the sincerity and commitment of concerned government agencies have eased the frustration of people who have been hoping to see the benefits of electricity. It has become apparent by now that numerous problems and issues that hinder electrification of barangays have to be addressed through different approaches.

Providing electricity to remote barangays even at the lowest cost seemed a formidable task. Geographic barriers, financial constraints and other crucial issues haunt program implementation.

How far, how wide

The rate of rural electrification in the 1960’s until mid-1990’s averaged at 500 barangays per year. Recognizing the need to complete the electrification of all 41,945 barangays by 2008 and make electricity available to 90% of Philippine households by 2017, structural reforms and innovative approaches aided by legislation have to be in place. Otherwise, we may still be groping in the dark after all the money and efforts are used up.

Intensifying rural electrification efforts in 1999, the government has focused on the O’ Ilaw Program and currently on the Expanded Rural Electrification Program to make sure everything is on track. Positive results show the rate of rural electrification has doubled from 500 to 1,000 barangays per year. It has thus reduced the number of unelectrified barangays to the last 2,400 as of September 2006.

Majority of these villages, however, are considered ‘last mile’ areas located in the remotest parts of the country where power grid extension is not technically and financially feasible. It also includes villages which have daytime inhabitants who pursue a livelihood such as farming, fuel-gathering or fishing but who go home to other barangays at night. Other ‘last mile’ barangays are battle areas or frequented by natural disasters.

Understanding the Rural Power Project To address this problem, the Rural Power Project (RPP) was designed consistent with the vision espoused under the Electric Power Industry Reform Act of 2001 (EPIRA). As the road map to clinching the vision of full electrification of all barangays and households nationwide, RPP has put greater emphasis on sustainability of the projects and enhanced greater private sector participation. With the Department of Energy at the helm, the RPP avoids the “business-as-usual” approach to delivery of services that are top-down, monopolistic and rely heavily on government funding.

The RPP simply refuses to become just like past government projects that begins with a bang and then is heard no more.

“This is a market-based program where we focus on the participation of the private sector and promote private-public sector partnership,” explains DOE Undersecretary Melinda L. Ocampo.

To put it simply, RPP offers viable solutions to facilitate electrification in villages where grid connection is too costly, and this is to go into decentralized electrification through renewable energy option. Initially, Market Packages using solar photovoltaic systems, micro- or mini-hydro or hybrid systems can be the efficient source of electricity in these areas. Later on, other renewable energy technologies such as biomass and wind energy may be utilized.

One of the innovative and decentralized electrification subprogram being introduced under the RPP is the Project ACCESS – Accelerating Community Electrification Using Sustainable Solar. Under the Project ACCESS is the Sustainable Solar Market Packages (SSMP) which strategy involves the clustering of barangays that will create a critical mass for any business undertaking. Specifically, SSMPs will be offered to eligible and qualified PV Companies who can provide the supply and installation of the PV systems for community use and be able to market individual solar home systems to households. Micro Finance Institutions (MFIs) come in to provide the lending window to the households and communities. Their money is backed up by the Loan Guarantee Fund which will share their risk in financing the acquisition of solar systems by rural households.

Valuable partnership

“The thrust of RPP is to develop business relationships with MFIs and PV suppliers,” says RPP Project Director Mylene C. Capongcol.

“A distinct difference of RPP from other electrification subprogram is the social aspect for the less privileged. Electricity should be able to facilitate the livelihood of rural people so that they will be able to pay for it,” adds Director Capongcol.

Subprojects under the RPP are not the usual dole-out of government. Hence, implementers such as the Department of Energy, Development Bank of the Philippines, Land Bank, the Local Government Units and other government agencies would have to ensure that the rural communities, MFIs and solar providers have an active participation in its implementation.

“A strong partnership in rural electrification will make the RPP work,” says PV Manager Gabriel Zamudio.

He explains that the communities have to be convinced that this is good for them because it allows them access to information, helps children do their homework at night, protects health of the people because it does not produce respiratory diseases like in the case of kerosene lamp use, enhance peace and security in the areas, and other benefits. The recipient LGUs, on the other hand, will own the system and ensure that the units work and are trained on maintenance of the installation. For MFIs and solar providers, they need to secure the money they invest.

“Also crucial is the role of the NGOs who are the most powerful change agents,” declares Zamudio.

With community mobilization, social preparation, message development, and a strong government-private business-community partnership, RPP believes it complete rural electrification by 2017. A number of Memoranda of Agreement have been signed between solar providers and MFIs and witnessed by DOE officials.

Steps ahead

At present, a solar PV system is being installed in a community in Higantes Island about five hours by land and pump boat from Iloilo City. Another one is being set up in Lanao, where in spite of security problems government and private workers are working hard to bring electricity to our Muslim brothers. Soon, Iligan City will be the first to have complete rural electrification as solar PV work is in progress in the last two barangays of Panoroganan and Kalilangan. Likewise, a total of 169 barangays in Mindanao will benefit from enhanced and revitalized solar PV electrification.

The road map has been set. For an auspicious beginning of 2007, let the work begin for the sake of our rural folks whose dream of electricity is long overdue.

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