“Amidst these interesting times, we will continue to pursue our businesses with vigor.”
Federico R. Lopez (FRL) made this affirmation during First Gen Corporation’s annual stockholders meeting, where he discussed the company’s transition to the global new normal that is now backdropped by COVID-19 the escalating climate crisis.
Endemic COVID-19 situation
According to data from the Department of Health, as of June 12 the Philippines has tallied totals of almost 3.7 million COVID-19 cases, 3.6 million recoveries and 60,000 fatalities. Active cases are currently at less than 3,000.
In terms of vaccination coverage, a total of 69.8 million Filipinos, or 77.51% of the target population, are fully vaccinated. The country recently started administering second booster jabs to frontline health workers, the elderly and the immunocompromised.
“Barring any new more virulent COVID-19 variants, it appears like the Philippines is headed toward an endemic COVID-19 situation where we learn to live with the virus without the restrictive lockdowns that have constrained the economy these last two years,” FRL said.
First Gen and the rest of the First Philippine Holdings Corporation (FPH) Group are remapping their offices in a way that will allow the companies to rebuild their corporate communities while accommodating the requirements of remote work.
“We’re keeping the best of both worlds, even using office real estate more efficiently as we move forward,” FRL noted.
The First Gen chairman and CEO also reminded his audience that while the climate crisis is a collective battle, the Philippines is especially vulnerable to the adverse effects of the phenomenon due to its location and archipelagic nature. Given this, it is but understandable for Filipinos to be “among the most driven to amplify calls for commitments to a 1.5-degree Celsius world.”
In the Global Climate Risk Index 2021 presented by Bonn-based nonprofit Germanwatch, the Philippines ranked fourth among countries most affected by climate change over the 20-year period from 2000 to 2019. However, the country was way ahead of the pack after being battered by 317 extreme weather events compared to the top three—No. 1 Puerto Rico had 24, No. 2 Myanmar 57 and No. 3 Haiti 80 over the same period. No. 7 Bangladesh and No. 10 Nepal came closest to the Philippines with 185 and 191 events from 2000 to 2019, respectively.
“So what does keeping to 1.5 degrees Celsius really mean? The science tells us we only have about 300-400 gigatons worth of greenhouse gases (GHG) left to emit before we exceed that number. Since the world currently emits 51 gigatons of greenhouse gas each year, we only have around 6-8 years remaining before we lose all chances of hitting that goal of limiting warming to 1.5 degrees Celsius and being left to contend with a harsher 2.0 degrees Celsius world or worse. The UN IPCC AR6 [Sixth Assessment Report] makes this very clear: the window is closing fast,” FRL said. “All these make our mission of ‘forging collaborative pathways for a decarbonized and regenerative future’ more urgent.”
With energy production said to be the biggest source of GHG at 47% as of 2020, First Gen is prepared to play a big role in the transition to a net zero economy. The company is focusing its efforts on liquefied natural gas (LNG), which could serve as “bridge fuel” to make intermittent renewable energy—wind and solar, for example—more reliable; this, in turn, will boost demand for these two platforms.
“When complete, our LNG terminal in Batangas City will allow us to import natural gas from around the world, thus providing consumers with clean, reliable energy that will also displace power produced by dirty coal, even after our indigenous supply in Malampaya is exhausted,” FRL shared.
With an expanded wind and solar portfolio, the company aims to attract grid operators, off-grid communities, households looking to switch to environment-friendly alternatives, and contestable customers or users who are allowed to choose their electricity supplier. At the same time, the company will embark on its own decarbonization journey.
“To meet that net zero carbon future, our natural gas plants will eventually need to be repowered, possibly with clean hydrogen, as technology develops and attains commerciality. In the same vein, we are pursuing energy efficiency schemes as well as taking stock of other technologies that will further advance our net zero goal,” FRL said.
In the same meeting, First Gen president and chief operating officer Giles Puno reiterated the need for the energy sector to move fast and to cease using coal.
“We have seen firsthand what the climate crisis looks like. We experienced the catastrophic effects of Super Typhoon Yolanda in 2013 and, more recently, Super Typhoon Odette in December 2021. While the Philippines is not a major contributor to global carbon emissions, these destructive natural calamities have affected our country severely,” he said.
Puno proposed a path to decarbonization that entailed lessening the use of and eventually totally phasing out coal; shifting from one-directional transmission lines to smarter systems; and going big on electrification, such as by adopting electric vehicles, to further fast-track the reduction of carbon emission.
Additionally, Puno assured, the company will “continue to provide the infrastructure and tools for building a resilient energy sector in the country.”
“The pioneering development of our LNG terminal is expected to be completed on schedule by the fourth quarter of 2022…. All of the main structural components of the terminal have arrived on-site and installation is ongoing,” he added.
At the end of the meeting, FRL expressed optimism despite the current challenges faced by the company and the tests still to come.
“The road will be filled with curveballs. But life isn’t just about the presence or absence of difficulties, it’s all about how we deal with those inevitabilities that matters. How we do that is what will make it such an exciting and fulfilling time to build businesses that meet the challenges of the 21st century.”