Can we afford cleanliness?

Let me make it clear from the start: I fully support a green world and the reduction, even elimination, of pollution of all kinds. But I am a realist. I realize that I have to pay for my stance. And I am willing to, but many other Filipinos are not able to. So President Duterte is right in questioning last December’s Paris agreement on climate change. Developing nations like the Philippines must be financially supported so that economic progress is not hampered. We must give all Filipinos a decent standard of living first. That means we must create jobs even if they are pollutants to some degree or other.

Mining is an obvious activity that pollutes while it’s in operation. But it creates jobs, and if it’s responsibly managed, it cleans up after itself. Without mining our modern lifestyle can’t exist, so we must make that trade-off: Allow mining, but minimize the damage. Mining companies operating under ISO 14001 do. (Incidentally, they don’t need the independent audit that Environment Secretary Gina Lopez is demanding. ISO 14001 is professionally and independently done by world experts. How would you find a group more knowledgeable than that, and why would you?)

Jeepneys are massive pollutants, with their old (or should I say antique), ill-maintained diesel engines. But if they were banned without a clean alternative, the Philippine economy would come to a halt. They must go, but only when the alternative is in place and working.

One pollutant I raised in my column titled “A clean Philippines” (5/19/16) was trash. Much of it, the bulk of it, can be eliminated just by people disposing of their trash properly. The Pasig River is filthy because people have nowhere else to dump their trash—and don’t care. I suggested that this be done under a “Clean Philippines” campaign. It got no reaction from the government. Back when incineration was discussed in Congress, I argued that the law should control the level of pollutants out of a “black box.” Leave engineers to design incinerators that can meet that pollution level. It was ignored, and incinerators were banned. So the land has to be polluted by mountains of rubbish, some of it toxic.

Then there’s electricity. Diesel is dirty, and fortunately little used. Coal is, too, but much, much less than in the past. Natural gas is pretty clean—not entirely, but close enough. The renewables are clean, so why not use only them? Two simple reasons: cost and continuity. As I read it, the public wants cheaper electricity and puts it ahead of cleanliness. Geothermal can be relied on as a stable, continuous power source, but its supply is limited. It can’t supply the needs of the populace. Hydro is also a stable source—if there’s water. And as Mindanao can tell you in the blackness of night, that’s not all the time. Biomass needs burnable crops, but people need food, too, so there’s competition for available land.

Solar and wind are good, but need sunshine and wind. Both cost more than coal now, but their cost is coming down such that in a few years they’ll be cheaper than coal. But not now. And both aren’t 24/7. Both can use batteries, but these add a lot more to the cost we must pay for. And enough reserve must be stored to cover not only nighttime but also several days of typhoons. The Philippines is hit by an average of 20 typhoons and heavy storm weather annually. And with the poorly-thought-out law, we’ll be paying a subsidy for 1,000 megawatts of solar and wind for the next 20 years.

Natural gas meets standards of cleanliness, but China won’t let us explore for more. Malampaya will run out of gas in 2024 or thereabouts. Add to that an administration (the previous one) demanding P53 billion in taxes that the contract says were not required (or who’d risk investing?). Mr. Duterte needs to drop this claim now. He should show that he does honor contracts, as he promised in his inaugural speech.

Modern coal plants using the fluidized bed system emit close to acceptable levels of pollution, and provide stable power every hour of the day. They are the essential foundation of the grid. The older plants aren’t as clean as we’d like, but they can’t just be shut down. Investors have poured money into them and have every right to get the investment back. And they must, if you want anyone else to invest—in anything. Allowing the private sector to recoup its investment is the bedrock of the world’s economies. And you can’t single out one sector without sending a message to all.

Last weekend, we went down to Red Alert. There wasn’t enough power. With a growing economy, that situation is going to get worse if the government doesn’t approve power plants that can be built quickly and provide reliable power at all hours. Having the ideal sources requires the luxury of time, which we don’t have. We need the coal plants that exist now, and we will need more in the next few years, until renewables can competitively replace coal as a base-load, not intermittent, source.

The last thing we want is the eight- to 12-hour blackouts that Cory Aquino left us with, and that Fidel Ramos had to fix at relatively high cost. Because he was over a barrel, power was needed fast and it cost more than if he had been able to negotiate from strength over time. We seem to be repeating history.

Then there’s cost. The public clamor for lower prices is intense. But as I’ll argue next week, you’re not going to see much reduction whatever the government does. And if the government continues to intervene in the market, whatever little can be achieved won’t be at the level hoped for.

See you next week.

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E-mail: [email protected]. Read my previous columns: www.wallacebusinessforum.com.