The Department of Justice (DOJ) opinion that natural resources, such as solar, wind, hydro, and ocean or tidal energies, are not covered by constitutional limitations on foreign ownership may pave the way for foreigners to invest more on renewable energy (RE).
Senator Sherwin Gatchalian described the DOJ opinion as timely and will put the country on the right path in solving energy problems.
“The removal of the 40-percent foreign ownership cap is a game-changer. This puts the country on the right path of creating an investment climate that would enhance the establishment of more renewable energy facilities amid global efforts to address climate change and the ongoing conflict between Russia and Ukraine,” Gatchalian said in a news release on Sunday.
The DOJ opinion was sought after Department of Energy (DOE) Secretary Raphael Lotilla previously told the Finance Committee Sub Committee E, chaired by Gatchalian, that attracting more RE investors hinge on amending the Implementing Rules and Regulations of Republic Act No. 9513 or the Renewable Energy Act of 2008.
Gatchalian said the country has long coastal areas, mountains, and ranges that can be used as a source of RE and could progressively bring down power rates and create more jobs within communities concerned.
“The absence of foreign ownership limitation on RE facilities augurs well with a recent decision of the Energy department to increase the percentage of RE utilization for on-grid areas from 1 percent to 2.52 percent and in line with the DOE’s vision of powering up communities with clean and sustainable energy systems,” Gatchalian said.
The increase to 2.52 percent shall take effect in 2023 and would help the country lessen its dependence on energy derived from fossil fuel and coal-based power plants, he said.
To date, 998 RE contracts generating around PHP270 billion worth of investments have been approved by DOE.
Such contracts have an aggregate installed capacity of 5460 megawatts (MW) and a potential capacity of 61,613.81 MW.
An increase in the use of RE could also enhance the development of other renewable energy sources that are yet to be harnessed in the country such as the ocean or tidal energy, green hydrogen, and off-shore wind, among others, Gatchalian said. (PNA)