Electric Vehicles Hold Promise of Bluer Skies for Manila

MANILA, PHILIPPINES - Philippine President Benigno S. Aquino III today transferred 20 Asian Development Bank (ADB)-funded electric tricycles (e-trikes) to the City of Mandaluyong, marking an important first step towards a sustainable, energy-efficient transport model for the country.

Emissions from the transport sector currently represent 30% of all pollution in the country, and approximately 80% of air pollution in Metro Manila. A sizeable proportion of vehicle emissions are attributable to inefficient public transport, particularly from tricycles, jeepneys and buses.

The 20 e-trikes are part of an ADB-funded project to introduce energy-efficient transportation alternatives in the Philippines. ADB is currently in discussions with the government and other development partners on a proposed project to significantly scale up the rollout of energy efficient e-trikes in Manila and other urban areas as early as 2012.

"Working together, we can give Manila cleaner air, bluer skies, and a more livable environment," said Kunio Senga, Director General of ADB's Southeast Asia Department. "The Philippines is assuming a leading role in Asia in supporting green transportation alternatives, and if e-trikes are followed by new fleets of electric buses and jeepneys, the effect could be transformative."

Over 3.5 million motorized tricycles are currently operating in the Philippines, producing more than 10 million tons of carbon dioxide and using close to $5 billion of imported fuel each year. Motorized tricycles - which are motorcycles with sidecars - are popularly used as low-cost public transport for short distances.

"Every 20,000 e-trikes that are introduced to Manila's streets will save the Philippines 100,000 liters of foreign fuel imports each day, saving the country about $35 million annually," said ADB's Principal Energy Specialist Sohail Hasnie. "This initiative not only benefits the environment, but it also supports the Philippines drive to become more energy independent."

Though the new e-trikes have higher up-front costs, older petrol tricycles are more than twice as expensive to operate and maintain in the long run. The cost savings will directly increase the incomes of e-trike operators.

The new ADB-supported e-trikes use lithium ion batteries, commonly used in laptop computers and mobile phones. The batteries can be recharged approximately 2,000 times, in contrast to lead acid batteries used in older e-trike models that need to be replaced every two years.

A recently concluded phase-one ADB pilot project demonstrated that the Philippines has the local manufacturing capacity and technical skills base to build and maintain a large e-trike fleet. Once thousands of e-trikes begin to be manufactured, many new jobs could be created.

Factoring in electricity required for charging the batteries, the e-trikes' carbon footprint will be less than one quarter of petroleum-fueled tricycles' carbon dioxide emissions.

As part of the pilot project, ADB will install four charging stations in Mandaluyong City, which will be able to charge the e-trike batteries to 50% capacity in less than 30 minutes. One of the charging stations will use solar energy.

(Source: http://www.adb.org) 

A Bright Idea for Energy Reduction

(With support from ADB, the Government of the Philippines is offering 13 million energy-efficient compact fluorescent lamps (CFLs) to replace traditional incandescent bulbs throughout the country. Photo by Tomas Eric Sales)

By Rita R. Festin

The Philippines is replacing energy-wasting light bulbs with more efficient fluorescent bulbs, promising to save millions of pesos—and bulbs—and to reduce debilitating power failures.

Cebu City, Cebu - Prodded by persistent power shortages, the Philippines government has turned to the humble light bulb to help end debilitating power failures in major urban centers, among them Cebu City—the fastest-growing in the country and second only to Metro Manila as an important industrial and cultural hub.

Under the US$46.5-million Philippine Energy Efficiency Project (PEEP), the government is offering 13 million energy-efficient compact fluorescent lamps (CFLs) to replace traditional incandescent bulbs in Cebu City and throughout the country, setting aside US$18 million for bulb replacement.

"If 1 million incandescent bulbs are replaced with CFLs at the cost of an estimated US$1.5 million, the electricity demand will be reduced by about 50 megawatts (MW)," said Sohail Hasnie, ADB principal energy specialist.” The impact on the power system will be equivalent to building a new 50 MW power station, which would have cost at least US$50 million and taken 3 to 4 years to build, and another US$2 million to US$3 million each year to operate.”

Funded in part by a US$31-million ADB concessional loan, the project will defer investments of some US$450 million in new power plant construction. It will also save about US$100 million annually in fuel costs and avoid 300,000 tons of carbon dioxide emissions annually by reducing power generation.

While the average incandescent bulb lasts only about 800 hours, the new CFLs last up to 10,000 hours, substantially reducing the residential customer's energy consumption and electric bill. Each customer can then save up to P400 (US$8.60) per bulb each year for the next 7 to 10 years.

Retrofit, Reduce, and Replace

The PEEP will retrofit government office buildings and public lighting systems with other efficient lighting options. It has established an energy service company as a one-stop shop to provide financial and technical support to companies and institutions planning to reduce energy consumption (such as hospitals, schools, government offices, hotels, and malls).

"With this project in place, the chances of brownouts are now getting slimmer," declared Energy Undersecretary Roy Kyamko during the recent project launching. “With the savings in megawatts, the load that will be prevented through the use of CFLs can be redistributed to other parts of the Visayas," he added.

In Cebu, privately owned businesses have resorted to using their own generators during scheduled power interruptions. The city’s rotating brownouts, as frequent as three times a day, are caused by aging and inefficient power plants. "When there is a shortfall due to a breakdown or maintenance of power plants, we have outages, which are happening right now," said Ethel Natera, Visayan Electric Company (VECO) spokesperson, ”If we don't interrupt our customers' power supply, there will be a problem in the whole system, resulting in a breakdown.”

”If any plant goes down, then there will be outages because there is no more reserve supply," said Jaime Jose Aboitiz, VECO executive vice president. According to government data, peak power demand is 1,175 MW, while the total power supply is only 1,140 MW.

Energy officials are hopeful that with the PEEP, and new power plants in place by 2010, the critical power situation will be tempered. Besides VECO, other electric cooperatives are also being tapped to distribute about 2 million CFLs in the Visayas.

VECO residential customers can visit any of its branches with their latest bill, identification, and two functioning incandescent bulbs and receive six 15-watt CFLs in exchange.

ADB is the lead financing agency in the Philippine power sector, with a third of its total of over US$10 billion in domestic lending going to generation, transmission, distribution, and sector development support. ADB also participates in the government's power sector restructuring and power plant privatization program to encourage competition, which would help lower electricity costs. The focus of ADB's future power sector operations will be on promoting efficient and renewable energy, and on improving rural distribution systems.

(Source:  http://www.adb.org/documents/feature-stories/2010/phi-bright-idea.asp?p=phimain)

ADB Conference to Address Asia's Water Crisis

MANILA, PHILIPPINES - Finding solutions to Asia’s water crisis will be the focus of an international water conference in Manila starting today.

About 600 representatives from water constituencies in government, think-tanks, non-profits, and industry from 53 countries will gather at the Asian Development Bank (ADB) headquarters from 11 to 15 October to discuss issues and solutions to the water crisis that threatens the region’s economic growth, and environmental sustainability.

Among the speakers for the “Water: Crisis and Choices – ADB and Partners Conference 2010” are Margaret Catley-Carlson, Patron of the Global Water Partnership; Paul Reiter, Executive Director of the International Water Association; Suresh Prabhakar Prabhu, Chairman of the Council for Energy, Environment and Water in India; and others from a variety of agencies and organizations engaged in the water business. They will exchange views on the scale and dimensions of the crisis, examine the application of current and emerging solutions, and determine new directions for sustainable water management in Asia.

Growing populations, rapid urbanization, and competing demand for water from agriculture, energy, industry, and urban areas have left water stocks in many countries in a critical state. Economic powerhouses, the People’s Republic of China and India, are seeing an alarming drop in available per capita water supplies. The onset of climate change, with increasing instances of extreme weather events, is already impacting Asia’s freshwater resources.

“Asia’s water world has gone past its tipping point. The challenge now is to urgently halt, if not reverse, the decline in freshwater availability,” said Arjun Thapan, ADB’s Special Senior Advisor (Infrastructure and Water), and the convener of the conference. “Asia needs to aggressively adopt measures that dramatically improve water use efficiencies and safeguard the region’s food and energy security.”

Around 80% of Asia’s water is used to irrigate crops, but much of it is used inefficiently, while many of the region’s most water-stressed countries lose large volumes of treated water through leakage in urban water supply systems. It is estimated that the region loses as much as 29 billion cubic meters of treated water a year, conservatively valued at $9 billion.

Large infrastructure investments will be needed to address the region’s current water problems, with at least $8 billion required just to meet the United Nations Millennium Development Goals (MDGs) 2015 targets for safe drinking water and sanitation. And unless service delivery is radically revamped with efficiency at its core, the challenge will remain unmet.

The conference will examine how to design and implement better demand management solutions by minimizing the water draw, and recycling and reusing wastewater. It will look at new approaches for water use in irrigation to improve productivity, measures needed to strengthen water governance, and pricing policies that can make the cost of supplying water fair and financially sustainable.

The conference will also examine prospects for increased private sector partnerships and investment to provide the expertise and resources needed to develop and fund water solutions.

During the conference, ADB will discuss its draft Water Operational Framework for 2011-2020, which suggests a framework for ADB’s prospective work in water, focused on supporting increased efficiency of water use, enhanced application of science and innovation, promotion of wastewater management and reuse, and the development of a corporate outlook in delivering water services.

(Source: http://www.adb.org/)

ADB Lifts Philippines' 2010 Growth Outlook on First-Half Surge

MANILA, PHILIPPINES - A strong and broad-based recovery during the first six months of this year will ensure the Philippines records solid growth for 2010, despite an expected moderation in the economic outlook for the next six months, the Asian Development Bank (ADB) says in a new major report.

According to the Asian Development Outlook 2010 Update (ADO Update), released on September 28, 2010, the Philippine economy is riding on the crest of a stronger-than-expected surge in domestic investment and industrial output, helped by external demand in the January to June period. Economic growth jumped 7.9% in the first six months of the year, up from a tepid 0.9% in the same period last year. As a result, ADB has lifted its growth forecast to 6.2% this year, up from a 5% forecast made in July.

The report also forecasts growth of 4.6% in 2011, unchanged from a projection in April, when ADB launched the flagship annual economic publication ADO 2010.

“Reduced policy stimulus at home and abroad, slower growth in world trade, and higher 2010 numbers are likely to temper the growth momentum in 2011,” says Neeraj Jain, Country Director for ADB's Philippines Country Office.

In 2010, the report says, private consumption grew 5.1% largely on higher spending on food and drinks, utilities, and transportation, mainly buoyed by overseas remittances.

Investment also made a significant contribution to growth, with fixed investment as a ratio to gross domestic product rising 17.2% during the period, the highest level in 7 years. Exports jumped nearly 40%, while imports increased 28.5%, reflecting the stronger demand for capital equipment and consumer goods.

However, the growth momentum has started to ease in the second half of the year, mainly due to leveling off of inventory building by businesses.

Inflation is expected to average 4.5% this year and 4.4% in 2011. Slower economic momentum and reduced policy stimulus will offset moderate increases in global energy and commodity prices next year.

ADB cited two key challenges for the Philippine economy – improving revenue collections and the investment climate.

“The country needs to increase its revenue collection in order to support social and development spending, which have lagged for many years,” said Mr. Jain.

Enhancing tax administration remains a key focus of efforts for revenue mobilization, the report highlighted.

The Philippines also needs to upgrade its investment climate to encourage new businesses and improve employment opportunities for its people, the report said. The relatively low level of private investment in recent years has been attributed to infrastructure deficiencies, as well as to weaknesses in governance and in the policy climate.

Downside risks to growth forecasts are from uncertainty over the strength and pace of the global economic recovery and La Niña weather disturbance that could hurt agriculture. Despite balance-of-payments surpluses and substantial foreign reserves, financial markets could also become unsettled if fiscal slippage continues, raising the country’s risk premium, it added.

Asian Development Outlook and Asian Development Outlook Update are ADB’s flagship economic reports analyzing the economic conditions and prospects in Asia and the Pacific, and are issued in April and September, respectively.

To download the ADB report on the region, including the Philippines, please click on this link: http://www.adb.org/Documents/Books/ADO/2010/Update/

Cash In Hand: Conditional Cash Transfers Free Families From Poverty - Asian Development Bank

Editor's note: We would like to guide our readers to a story by the Diliman Diary on August 25, 2010 (http://diliman-diary.blogspot.com/2010/08/4.html) about a 2010 study conducted by several professors from U.P. Diliman's School of Economics stating in part that conditional cash transfers were among the more successful government interventions in the Philippine setting.

Asia's Expanding Middle Class Presents Huge Opportunity for Region, World - ADB

(Interview with with ADB Chief Economist Jong-Wha Lee. Source: http://www.youtube.com/)

NEW DELHI, INDIA - Developing Asia's rapidly expanding middle class is likely to assume the traditional role of the US and Europe as primary global consumers and help rebalance the global economy, says a new report on Asia’s middle class from the Asian Development Bank (ADB).

The report, published in a special chapter of Key Indicators for Asia and the Pacific 2010, the flagship annual statistical publication of the ADB, found that Asia’s consumers spent an estimated $4.3 trillion (in 2005 purchasing power parity dollars), or about one-third of OECD consumption expenditure, in 2008 and by 2030 will likely spend $32 trillion, comprising about 43% of the worldwide consumption.

The special chapter, titled "The Rise of Asia’s Middle Class”, examines the rapid growth of Asia’s middle class, how the poor advance to the middle class, factors that characterize the middle class, and pathways through which they become effective contributors to growth and poverty reduction in the region.

“Developing Asia’s middle class is rapidly increasing its size and purchasing power, and will be an increasingly important force in global economic rebalancing,” said ADB Chief Economist Jong-Wha Lee. “Even though the Asian middle class has significantly lower income and spending relative to the Western middle class, its growth in expenditures has been remarkable and its absolute levels are commanding.”

Strong economic growth in Asia over the past two decades has been accompanied by significant reductions in poverty as previously poor households have moved into the middle class. Defining the middle class in Asia as those consuming between $2 and $20 per day, the report found that in 2008, Asia’s middle class had risen to 56% of the population—or nearly 1.9 billion people—up from 21% in 1990. The middle class of the People’s Republic of China (PRC) is currently larger than all others in absolute size, having added 800 million people to its ranks between 1990–2008. In the same period, spending in Asia increased almost three fold, compared to marginal increases in all other regions, including developed countries. As a result, consumption expenditures by developing Asia are now second only to developed countries.

The report stresses that a great number of Asia’s new middle class individuals still get by on incomes just above poverty levels, leaving them vulnerable to a relapse into poverty. At the same time, the emergence of so much new spending power carries with it a host of new environmental and health concerns that until recently were more typical of wealthier parts of Asia and the world.

“Clearly, policies are needed that both bolster the new status of the middle class and deal with its adverse consequences; policies that encourage the creation of and access to more well-paid jobs and more advanced education and health care to help prevent slippage back into poverty, and that mitigate additional environmental constraints and health concerns,” said Dr. Lee.

Yet, in balance, expectations are that Asia’s middle class, through its sheer size and dynamism, will present a huge opportunity for the region and for the world. The report projects that by 2030 much of developing Asia will have attained middle class and upper class majorities, with the PRC and India expected to provide the largest number of new middle class. With the appropriate middle-class friendly policies, the report says, Asia will be able to move away from export-led to domestic-led consumption growth and reduce its exposure to negative external shocks, such as the 2008 global financial crisis, which began in the US. In turn, it will also help correct the global imbalances that contributed to the financial crisis.

(Source: http://www.adb.org/Media/Articles/2010/13306-asian-key-indicators/)