FGEN chairman and CEO Federico R. LopezAs the world counts down to 2050 and the net zero emissions goal, First Gen Corporation is stepping up its own efforts on various platforms and stages to reiterate the urgency of the mission.
Highlighting the enormity of the task ahead was the US’ National Centers for Environmental Prediction report that the planet has just experienced a series of 17 degrees Celsius days. Most recently, it sizzled at 17.23 degrees (63 degrees Fahrenheit) on July 6, 2023— unofficially the hottest day ever recorded.
At the First Gen annual stockholders’ meeting in May, chairman and CEO Federico R. Lopez (FRL) bared the steps that First Gen and the First Philippine Holdings Corporation Group will take in support of the government’s decarbonization targets while helping meet the Filipinos’ growing power demand.
Reducing GHG emissions
In its first Nationally Determined Contributions report submitted in 2021, the Philippines had committed to reduce its greenhouse gas (GHG) emissions by 75% from 2020 to 2030; 2.71% of this is “unconditional,” or what a country could implement based on its own resources and capabilities, according to 100% RE MAP.
If the Philippines remains in “business-as-usual” mode, the government estimates that overall emissions during that span will hit around 3,340.3 metric tonnes of carbon dioxide equivalent, according to the United Nations Development Programme’s Climate Promise.
FRL said First Gen is zeroing in on two key fronts in the decarbonization mission:helping reduce the carbon intensity of the electricity grid or transmission system and then decarbonizing it.
“We’re making it our mission to shepherd the energy transition to net zero,” he said, adding: “Decarbonizing and scaling up a green electricity grid over the next three decades is probably the greatest energy transition in the history of mankind.”
Greening the grid
Decarbonizing or greening the grid entails moving away from burning fossil fuels and transitioning to renewable energy sources and other low-carbon energy sources, to be supplemented with battery and pump hydro storage systems. This will have the effect of lowering the carbon intensity of the power generation process.
To help lower its emissions, the Philippines can add to its renewable energy sources “no regret options” like hydro and geothermal power. Solar and wind, while also plentiful, are not available 24/7 and will need to be augmented with additional grid capacity and storage (or batteries). But since batteries themselves have a limited shelf life, natural gas can be used as “bridge fuel” that will enhance the reliability of intermittent renewable energy like solar and wind.
“We view First Gen’s diverse portfolio of clean and renewable energy sources as a key enabler to a greener electricity grid. Our target is to grow our low carbon energy portfolio to 13,000 megawatts by 2030, of which 9,000 megawatts will be renewables,” FRL said.
The company currently has an installed capacity of about 3,501.4 megawatts through its power plants that run on renewable energy sources, including natural gas, the cleanest form of fossil fuel.
LNG terminal completion
The First Gen chairman, additionally, reported the completion of the liquefied natural gas terminal in Batangas and the imminent commissioning of the BW Batangas floating storage and regasification unit (see sidebar).
“Of course, over time, we must look toward repowering our natural gas facilities with green fuels like hydrogen as these become more feasible, or they can be decommissioned outright before 2050,” he noted.
He laid out a phased solution to climate change which could be carried out over the next 27 years.
“In Phase One, we reduce greenhouse gas emissions of carbon dioxide, methane, nitrous oxides and fluorinated gases from the current 59 gigatons of GHGs per year, and we see emissions peak by 2025. This is where most efforts are centered today. But we cannot stop there,” he stressed.
This will be followed by Phase Two, the total elimination of GHGs in order to meet the net zero goal by 2050. Lastly, Phase Three from 2050 onwards calls for reducing the concentration of GHGs in the atmosphere in order to achieve “net negative emissions.”
“We now need to realize Phases One, Two and Three within the rapidly diminishing timeframe of the next 27 years. Failing to do this over the limited period will trigger irreversible tipping points, the effects of which we are already seeing in news reports from all over the world every day,” FRL noted.
He added that solving the climate emergency has implications on everything, from agricultural practices and food production to industrial processes, among others. Further, stepping up the shift to renewables requires “reducing the carbon intensity of electricity, scaling up energy efficiency efforts, electrifying as much of transport and the industrial sectors, using carbon-neutral fuels for other hard-to-reach sectors, and deploying nature-based and man-made carbon capture, use and storage.”
“All these will have immense implications for the central role of the electricity grid. The most important point is that by 2050, we will need five times the electricity we use today, and we will need 10-12 times the clean energy in use today,” the First Gen chairman added.
He also underlined the need to keep power prices affordable even as the world focused its power and resources on solving the climate crisis.
“We must continue to improve access to 24/7 electricity for millions of households in the country who currently do not have it reliably in their lives if we are to even begin uplifting them from poverty,” FRL said.
Meanwhile, also reelected with FRL for another term during the stockholders’ meeting were the following members of the board of directors: Atty. Rachel Hernandez, corporate secretary; Manuel L. Lopez Jr., director; Alicia Rita Morales, independent director; Giles Puno, director, president and COO; Richard Tantoco, director and executive vice president; Edgar Chua, independent director; Manolo Michael de Guzman, director; and Cielito Habito, independent director.
Also reelected as directors were Rina Lopez and Rafael L. Lopez. After the ASM, director-elect Rafael L. Lopez tendered his resignation in anticipation of his commitments as a director of an affiliate company, where he expects to devote his full time and attention as a member of the board of directors. Maria Presentacion Lopez Abello was elected to take his place. Tantoco resigned as EVP effective July 1, 2023 due to health reasons but remains a First Gen director.
Officers and directors at the 2023 ASM
Workers at the interim offshore LNG terminal construction site