The Philippines AMORE Project: Renewable Energy as a Catalyst for Social and Economic Development

1. The Philippines AMORE Project: Renewable Energy as a Catalyst for Social and Economic Development Ellen S. Bomasang APEC Village Power Workshop November 7-10, 2004 Hanmer Springs, Canterbury, New Zealand

2. Winrock International • Private non-government organization • Currently implementing more than 160 projects around the world • Headquarters in state of Arkansas • Project offices in more than 40 countries • Energy programs based in Arlington, Virginia

3. Winrock’s Core Programs • Clean Energy • Agriculture • Forestry and Natural Resource Management • Ecosystems Services • Leadership Development • Volunteer Technical Assistance

4. Clean Energy Group (CEG) Premise: Energy is a crucial input to development, and its growth can be met in an environmentally sustainable manner Goal: Increase the use of environmentally sustainable renewable energy (RE) services in a manner that enhances socio-economic development

5. CEG Products and Services • Technical Assistance • Project and program preparation and implementation/management • Policy analysis and guidance • Institutional capacity building • Business advisory services • Education and outreach • Financing facilitation

6. Clean Energy Group (CEG) • Focus on • Community mobilization and Building local capacity in RE • Accelerating RE commercialization and market development • Improving access to rural energy services • Focus on socially and economically productive applications • Facilitating industry linkages • Renewable Energy Project Support Office (REPSO) network in Brazil, Guatemala, Nepal, India, Indonesia, South Africa, and the Philippines

7. Alliance for Mindanao Off-Grid Renewable Energy (AMORE) Program

8. Background on Project Area • One of poorest regions, lowest level of public services (e.g., electricity, education, water, health) • Conflict area with peace and order problems • Former separatist rebel communities, long-time rebel soldiers attempting civilian lives and livelihoods • Some areas still contested/subject of peace negotiations • High risk of violence, including political, inter-clan conflicts, robbery, kidnapping • Heavily armed population with military weapons • Many private companies limit activities for safety and security reasons

9. AMORE: Mission Statement • Contribute to peace and development initiatives in Muslim Mindanao by improving the quality of life in unelectrified rural communities through sustainable renewable energy projects and effective community organizing

10. AMORE: Project Objectives • Support electrification of 160+ rural communities (barangays) in Mindanao using renewable energy systems for lighting, productive uses, and social infrastructure • Support peace process by working with former rebel communities for social and economic development • Project duration: February 2002 – December 2004

11. AMORE Sites

12. Stakeholders • U.S. Agency for International Development (USAID) • Philippine Government, Philippine Department of Energy (DOE) • Autonomous Region of Muslim Mindanao (ARMM) • Winrock International (project implementer / manager) • Mirant Philippines (private sector donor)

13. Stakeholders • Beneficiary communities • Sub-grantees/subcontractors (PEI, YAMOG, MDFI, YMFI, SIBAT, SRE, MUFTI, IRG-P, NREL, WorldWater, NMSU • Other Philippine partners (rural electric cooperatives, Philippine Government agricultural, fisheries, micro-credit, SciTech, power sector agencies, and private foundations) • Stakeholders have complimentary goals that need to be balanced: project cannot be focused just on renewable energy development and RE market development

14. Stakeholders’ Interests/Goals (1) • USAID and Philippine Government: Support peace & development in Mindanao, ensure communities benefit, support clean energy development • Philippine DOE: Electrify all barangays in country, with at least 30 households served in each barangay • ARMM Government: Support development, convince residents that peace accord & regional government provide benefits • Mirant Philippines: Help meet its commitment to DOE of supporting electrification of 1,000+ communities

15. Stakeholders’ Interests/Goals (2) Beneficiary communities: access to improved energy and other services, social and economic development • Winrock: Support peace & development, effectively implement project while balancing stakeholders interests • Compromises necessary due to competing goals: • Focus on number of barangays, not full electrification of barangays; • Focus on community organization & social, economic & institutional development instead of exclusive focus on energy systems

16. MIRANT Philippines • Largest independent power producer (IPP) in Philippines • Mirant funds rural electrification, in part as a legal obligation, in part as corporate donation • Providing more than $1.5 million in donations (approximately $13,000/barangay) • Cooperation with Winrock under AMORE supports the Philippine DOE’s policy of relying in part on IPPs to co-finance and implement rural electrification projects

17. Renewable Energy Technologies Used • Solar PV battery charging stations (BCS), solar home systems (SHS), streetlights, telecom, power systems for other applications • Micro-hydro (5 prepared, 3 implemented) • Biomass (thermal applications) • Wind power not used due to low wind resource in project area • PV BCS supported in part due to concerns about inability to enforce monthly fees (too dangerous to repossess SHS for nonpayment), PV focus now on SHS, communications, education

18. Project Approach • Not renewable energy (RE) development or RE market development per se • Use RE for basic service and as catalyst to organize communities for social and economic development • In marginalized/neglected communities, the RE interventions have major impacts on peoples’ perception of benefits of peace and hope for future • Difficult environment prevented on commercial approaches to energy system/service supply • Work with BRECDAs to prepare and implement social and livelihood projects, including both RE and/or non-energy projects • Maximize links between BRECDAs and vendors for repair, parts, market expansion, battery recycling

19. Community Level Institutions • Due to lack of producer cooperatives or other pre-existing organizations in most AMORE communities, institutions had to be created to manage energy systems and collect fees. • BRECDAs (Barangay Renewable Energy and Community Development Associations) were formed • Main BRECDA tasks: • Operate and maintain energy systems; • Collect fees and manage O&M fund; • If possible, expand service to additional households AND • Pursue other economic and social development activities

20. Barangay Renewable Energy and Community • Development Association (BRECDA) • BRECDA composed of electrified households, with elected Chairperson and Treasurer, employs local operator or technician • Manages fee collection, O&M fund accounts • Systems/service is subsidized, but users must pay monthly fees: $3 (U.S.)/month for service via battery charging station (BCS); $5.40/month for solar home system (SHS) • O&M fund supports repair, partial cost of battery replacement, expansion of service to new households • BRECDAs formally register, establish bank accounts • Winrock provides training in financial management, leadership, and livelihood project preparation

21. O&M Fee Structure for Barangays with PV BCS Systems * The balance will be paid by the member upon battery replacement.

22. Sample O&M Fee Structure forBarangays w/ Solar Home Systems * The balance will be paid by the member upon battery replacement.

23. Projects Supported • Basic electrification for lighting andHH uses is major focus in all communities (minimum 30 HH) • Social/community services: street/dock lighting (all), communications, water supply, school electrification (others in 25+, ) • Income-generating livelihood activities • Productive use of RE (15+ pilots/demos) • Other improvements to production and marketing, including many with no energy intervention (30+)

24. Social Project Example: Telephony • Evaluate technical options, institutional approach • Supervised payphones in central barangay locations • Testing different business models • Use of cellular (fixed or handset) or fixed satellite technologies depending on service availability • Six GSM fixed cellular payphones and two fixed satellite phones installed by November 2004 • Modest revenue generation for most BRECDAs with donated handset • Expanded rollout planned under AMORE 2

25. Other Social Pilot Projects • School Electrification/Distance education • Collaboration with Knowledge Channel • Dual-use mini-cinema (TV-DVD) for both entertainment and educational purposes • Limited computer/ICT (2 communities) • Potable water supply • Health • Link BRECDAs with malaria prevention program of Shell Pilippinas Foundation (i.e., leverage BRECDA institution)

26. Two Main Types of Livelihoodor Productive Use Projects • Productive use of renewable energy: mostly pilot and demonstration projects • Solar thermal and biomass thermal for drying • Micro-hydro for milling, workshop • Pumping/micro-irrigation for high-value crops • Aquaculture • Livelihood projects w/no energy component • Improved seaweed production (Lantay, credit) • Gravity-fed micro-irrigation for vegetables * Can also provide TA for non-RE energy interventions (e.g. diesel-powered ice-making)

27. Livelihood Projects Livelihood Project ApproachPartner Agencies DOST, BFAR, UNDP TLRC, DTI • Work with BRECDAs/producers to assess options • Build on existing economic activities • Carragenan seaweed production • Fishing, aquaculture • Agriculture

28. Livelihood/Productive Use Projects: Forms of AMORE Support • Technical assistance • Information dissemination • Capacity building • Assessment of productive use energy requirements and options (e.g., drying) • Capital funding for productive use field projects including demos, pilots, other • Financing facilitation (QUEDANCOR)

29. AMORE’s Implementation Strategy for Productive Projects • Assess existing livelihood to identify potential productive application of RE, AND/OR other ways to improve to production, post-harvest, and marketing • Prepare feasibility study • Prepare plans using participatory process • Focus on productive use of RE

30. AMORE’s Implementation Strategy for Productive Projects • Design and implement training for the BRECDA and members to manage/implement the project • Facilitate access of BRECDAs to funding or credit institutions and market information • Monitor implementation & institute needed improvement as needed • Document experiences of implementation

31. Productive Demonstrationand Pilot Projects • Solar and biomass-fired drying for fish, rice, grain, seaweed • Micro-irrigation for high-value vegetable production (PV and treadle pumping) • Grain and coffee milling (micro-hydro) • Aquaculture—lighting, modest aeration • Ice-making (TA only, for diesel-powered system) • In AMORE 2, increased focus on micro-hydro, including for productive uses, and on community-based natural resource management (CBNRM)

32. Accomplishments • Electrified 141 communities and over 4,240 households with PV and micro-hydro by 8/2004 • More than 200 communities and 6,300 households to be electrified by 12/31/2004 • 170 Barangay Renewable Energy and Community Development Associations (BRECDA) to manage energy systems and implement economic development activities (205 by 12/31/2004) • Trained BRECDA members on technical issues, administrative and financial management

33. Accomplishments • Contributed to peace process by engaging with historically neglected communities • Recognition by USAID, Philippine government, private donors, and communities of AMORE project performance and benefits • Positive performance & community requests have led to follow-on AMORE II project (FY2005-09) • Developed/piloted models (e.g., rural telephony) for broader implementation in AMORE 2

34. AMORE 2 Follow-On Project • October 2004-September 2009 (implementation starts 1/2005) • Target: At least 200 barangays including 20 micro-hydro (11,600 households) • Support peace & development in conflict-affection regions through provision of basic rural electrification and related services

35. AMORE 2 Follow-On Project • Strengthen community abilities to effectively manage natural resources and implement economic development activities, • Micro-hydro sector strengthening to improve ability of Philippine industry and NGOs to assess, plan, and implement micro-hydro projects

36. AMORE 2 Changes vs. AMORE • Increased focus on use of renewable energy for high value social and productive applications • Major focus on microhydro development • Community-based natural resource management activities, including watershed protection • Develop lower-cost household lighting options, increase cost-recovery