ADB should withdraw its financial support to KEPCO Naga Coal Plant

Statement

CEBU, Philippines - Kalikasan People's Network for the Environment backs up the demands of the local opposition for Asian Development Bank (ADB), the biggest public bank in Asia, to stop its financial support to the Korean-owned Naga Coal Plant in Cebu.

ADB has met up with the local groups who filed and have been granted a Temporary Environmental Protection Order (TEPO) by the Mandaue Environmental Court against the 200 megawatt (MW) coal power plant in Naga City, Cebu. ADB provided a $120 million loan in December 2009 to the said coal-fired power plant owned by Korea Electric Power Corporation (KEPCO) and SPC Power Corporation.

In spite of the strong community opposition and ADB's self-proclaimed commitment to support climate change mitigation and develop renewable energies in the Philippines, ADB continued to fund the dirty and pollutive coal energy project not only in Cebu but other areas as well.

In 2008, ADB provided $370 million for the acquisition and rehabilitation of the 600MW Masinloc Coal Power Plant and 728 MW Pabilao Coal Power Plant in Luzon. ADB has also consistently funded coal power projects in Asia despite coal-fired power plants being proven to be the dirtiest and hazardous energy source and primary source of global carbon emissions and climate change.

Coal-fired power plants have also been identified as having the highest external cost among other energy plants which is the cost of impacts of the plant that were not computed or compensated such as health and environmental damages. Though coal as a fuel source is cheaper to buy for energy companies, it does not result to lower electricity rates for Filipino consumers.

Coal power was pushed by KEPCO, SPC and ADB not because it is safest, cheapest, and most efficient power supply option in Cebu and Central Visayas, but because it will surely bring in the highest revenue and profit for them at the expense of the communities and environment.

Even in the KEPCO study, it was reported that the Philippines is the world's second largest user of geothermal energy for power generation with 1,958 MW accounting for 12% of the country's total installed capacity. Almost 50% of the Philippines total geothermal capacity is located in the Visayas (723 MW in Leyte and 242 MW in Negros) with an excess of 395M MW of electricity produced by geothermal plants in Samar and Leyte.

The total geothermal potential in the Visayas is estimated at 1,619 MW constituting 42% of the country's total geothermal reserves. With the excess electricity and rich geothermal potential that can be tapped, there is more than enough energy to supply the demand and need of Visayas. Yet, KEPCO, SPC, and ADB, pursued the coal-fired power plant project and was permitted by the government.

By supporting the coal project, the government and ADB extends its support to private corporations' greed for profit, lack of enabling laws to protect our communities and environment in the country, corruption in the bureaucracy, and flawed energy policies and programs in the country.

The ADB was conscious enough to invite the local groups and talk about the petition against the project; however, if the ADB is indeed truthful to their statement to mitigate climate change, protect the environment, and develop clean and renewable energies then they will withdraw their financial support to the SPC-KEPCO Naga Coal Power Plant.

Kalikasan People's Network for the Environment is a network of people's organizations (POs), non-governmental organizations (NGOs) and environmental advocates. It believes that the struggle for the environment is a struggle of the people, thus all environmental action shall have the interest of the majority at their core.

Clemente Bautista

National Coordinator

Kalikasan PNE