German firms urge government to simplify renewable energy investments

MANILA, Philippines - German companies are urging the Philippine government to improve processing for renewable energy (RE) projects and aid in local risk mitigation to attract power investments in off-grid areas.

The Philippines has good prospects for RE developments because of the need for more supply and the availability of solar and wind resources, IB vogt international business development director Jens Kompauer said in a briefing held in Makati City yesterday.

“Conditions are very good. Energy prices are high because you have to import coal but you have good solar, wind resources. In the mid-term, it should be good prospects,” he said.

However, German firms have raised concerns over risks and processing of RE investments at the local level.

Kompauer noted the smaller the project is, the harder it gets to secure financing.

This calls for a local risk mitigation for financing RE developments, Autarsys GmbH managing director Matthias Ross said in the same briefing.

“What we need is local risk mitigation but we know we have investors from Germany interested to invest in small power plants from $200,000 to several million dollars, which normally is not a business case for bigger banks who take care of $15 million upwards,” he said.

Among the main concerns seen in the processing for RE projects is the land conversion.

Kompauer said land conversion process is the biggest delay for projects for financing to be in place, which can be “a show stopper” in the country’s RE development.

“It is not trivial that the general process of development needs to be revised and, hopefully, facilitated. It is a lengthy process especially looking at the land conversion aspects,” he said.

“We hope policymakers can address this and we hope they can help RE can have more priority,” he added.

Despite concerns, German companies are still keen on investing in the Philippines to participate in the country’s 90 percent electrification goal with RE.

“As long as we see a clear supply-demand problem here, then we have to go to private sector,” Kompauer said.

Officials of eight German companies are in the country to look for partners to implement RE projects, particularly in far-flung areas.

These companies include 8p2 Ingenieurspartnerschaft, an engineering firm specializing in technical inspection and consulting; Autarsys GmbH, a provider of modular energy storage systems; IB Vogt GmbH, a global solar EPC company; IBC Solar AG, an international provider of comprehensive solar solutions; PV2 Energie GmbH, a solar project developer; Qinous GmbH, a provider of plug and play energy storage solutions; SaEnergy Systems GmbH, which provides independent and stand-alone energy supply; Solea AG, a leading turnkey PV systems provider.