A sustainable approach to

waste management

in the Philippines

RUTH P.BRIONES Chairman/Chief Executive Officer

www.greenergyph.com

Greenergy Solutions Inc.

Greenergy Solutions Inc. (GSI) is a start-up international company, organized by professionals and with more than 100 years combined experience in technology, operations, financial and policy issues in environment and power utility sectors.

  GREENERGY SOLUTIONS INC. aims for

sustainable development by providing the needs of the current world populations without compromising future generations by creating “Green Culture”.

The company’s founders and management seek to utilize their professional experiences, relationships and unique skills to originate environment and renewable energy project(s) and collaborate with foreign partners and investors experienced with development of renewable energy projects.

The company…We envision to be a

total solutions provider and to be long-term reliable partner offering an integrated range of expertise.

GSI had entered with partnership with leading technology and engineering companies worldwide which enable it to engage its customers requirements and needs in tune with industry trends and market needs.

OUR CORPORATE SOCIAL RESPONSIBILITY

BALANCE SUSTAINABLE ECONOMIC DEVELOPMENT;

ENVIRONMENTAL STEWARDSHIP

RENEWABLE ENERGY DEVELOPMENT;

NATURAL RESOURCES PROTECTION AND CONSERVATION

COMMUNITY INVOLVEMENT AND PEOPLE EMPOWERMENT

The State of the Philippine Solid Waste ManagementCountry Profile

88-92 million population nationwide

12 million resides in Metropolitan Manila area;

17 LGUs compose the Metro Manila area

1,700 cities and municipalities nationwide

42,000 barangay units Wet and dry season Island nation

The Philippines’ waste situation in photos

Status of Waste Management in the Philippines

Indicator National Metro Manila

Per capita MSW generation rate (kgs/day)

0.30-0.71 0.32-0.71

MSW generated (tons/year) 12 million 2.5 million

Collection efficiency Urban: 70%Rural: 40%

83%

% of waste recovered and reused

13% 25%

% of MSW composted 10%

% of recycled and sold 5% 6-12%

% of MSW disposed in controlled dumps

30%

Number of disposal facilities (OD, CDF, SLF)

909 8

Sanitary Landfills 11

Status of implementation of the National Solid Waste Management Program

Indicator National M. Mla

Closed Sanitary Landfill

22

No. of MRF’s 829829 220220

% of LGU Budget alloted to SWM

1-24%1-24% P64.00-P64.00-P1,164.00P1,164.00

Per capita Per capita allocations in allocations in LGU’sLGU’s

P12.00-P12.00-

P250.00P250.00

Philippines’ National Waste Generation (2000-2010) Philippines’ National Waste Generation (2000-2010)

  2000 2010  Mln.

T/Yr.% of total

Mln. T/Yr

% of totalNCR 2.45 23.0 3.14 22.3

Cordillera AR 0.17 1.6 0.21 1.5Ilocos 0.50 4.7 0.63 4.5Cagayan Valley 0.32 3.0 0.40 2.8Central Luzon 0.96 9.0 1.32 9.4Southern Tagalog

1.42 13.3 2.11 15.0Bicol 0.54 5.1 0.65 4.6Western Visayas 0.82 7.7 1.00 7.1Central Visayas 0.74 7.0 1.01 7.2Eastern Visayas 0.43 4.0 0.51 3.6Western Mindanao

0.40 3.8 0.53 3.8Northern Mindanao

0.37 3.4 0.47 3.4Southern Mindanao

0.70 6.6 0.97 6.9Central Mindanao

0.33 3.1 0.41 2.9ARMM 0.26 2.5 0.39 2.7Caraga 0.26 2.4 0.31 2.2National 10.67 100 14.05 100

Status of Waste management in Local Government Units

Collection and Transport of Solid Waste Collection of solid waste is the responsibility of the LGU mandated by the Local Government Code (Republic Act 7160) and reiterated in RA

9003, specifically at the barangay level for compostable and recyclable/reusable waste. National collection efficiency average is about 70% in urban areas and 40% in rural areas. For Metro Manila, collection efficiency is pegged

at 83% based on the actual amount of waste disposed. Based on the survey conducted by the Secretariat of the NSWMC in 2003, 27 local government units achieved a 100% collection efficiency. These are:

1. Banayoyo, Ilocos Sur 15. Kalayaan, Cavite 2. Jabonga, Agusan del Norte 16. Mabitac, Laguna 3. Ivana, Batanes 17. Kawit, Cavite 4. Uyugan, Batanes 18. Noveleta, Cavite 5. Tuguegarao, Cagayan Valley 19. Trece Martires, Cavite 6. Sta. Maria, Isabela 20. Bacoor, Cavite 7. Balagtas, Bulacan 21. Dasmarinas, Cavite 8. Marilao, Bulacan 22. Imus,Cavite 9. Cabuyao, Laguna 23. Rosario, Cavite 10. Angono, Rizal 24. Tanza, Cavite 11. Taytay, Rizal 25. Cavite City, Cavite 12. San Pedro, Laguna 26. Sto. Tomas, Cavite 13. Sta. Rosa, Laguna 27. Panglao, Bohol 14. Binan, Laguna

Status of Waste Management in the Philippines

Some LGUs in Metro Manila even in other parts of the country are not recovering the full cost of garbage collection service. Since it is only the business sector that is paying garbage fees, the rate of recovery of SWM expenses is very low. The bigger part of the expense is thus subsidized by the LGUs and indicated in their allocated budget or General Appropriation for the year.

Status of Waste Management in the Philippines Willingness to Pay

Collection of waste management fees from the residential sector appears to be situational. While it is being done in some isolated barangays and in some cities and municipalities, LGU survey reveals that the willingness of household to pay for SWM is quite low. Political interventions are sometimes hindering LGUs in imposing user fees. Many LGU constituents have the perception that the LGUs are supposed to extend all services, hence introducing fees and charges are next to impossible. (see Figure below for the result of a Willingness-to-pay Survey conducted for Metro Manila)

For first class subdivision and villages, garbage fees are incorporated in the association annual dues particularly in areas where the association takes charge of the garbage collection and in some middle class residential areas people are actually paying small-time haulers (using carts) to collect their garbage. These areas are oftentimes inaccessible to the LGUs garbage trucks due to narrow roads or being in the coastal areas. The average garbage fee is about Php 40.00 to Php 50.00 per household per month..

According to a study conducted for Metro Manila, 39% of the respondents revealed that affordability to pay the garbage fees are the main reason for most of the respondents why they are not willing to pay.

Status of Waste Management in the Philippines Key Issues and Challenges: Administrative and

Management

Based on the Solid Waste Management Profile Survey conducted by the NSWMC-secretariat, politics plays a major role in the implementation of solid waste management. Political will is essential to the overall success of the solid waste management program of the constituent Barangays.

The implementation of a comprehensive solid waste management program can be hindered by the negative attitude of the local officials towards the implementation of RA 9003. The lack of responsibility and initiative on the part of the officials to create an effective solid waste management board or committee, and to draft ordinances and resolutions to support the Act are some of the inhibiting factors in the political point of view.

In some localities, proper SWM is not implemented simply because it is not a priority of the officials. Meanwhile, the term of office of an official is also crucial. A comprehensive and effective solid waste management program of an official may not be sustained after his term of office due to conflicting priorities with the succeeding official.

To answer this challenge, adequate and proper incentive should be provided to enable the implementers, specially the local government unit and the private sector to aggressively implement and enforce the law. While incentives will be provided for the implementers, legal actions should also be carried out to those who would be violating the law. An appropriate civil, criminal or administrative action should be filed in the proper courts/bodies against those who would be violating and failing to comply with the provisions of the law.

The status of Waste Management in the Philippines

The existence of an efficient private company to oversee the implementation of a solid waste management system is essential to the success of a solid waste management program.

However, not all LGUs have already created a solid waste management board to formulate the SWM Plan and ensure the implementation of an effective ecological waste management system. Likewise, not all Barangays have created a functional Solid Waste Management Committee in accordance with the law. This is despite the Memorandum by the Department of Interior and Local Government and extensive IEC campaigns and program being organized by the DENR and participating environmental organizations to expedite the creation of these bodies.

There should be constant monitoring of the boards and committees formed to ensure sustainability of the implemented plans and programs on waste management. Similarly, a point person from the local government should also be appointed to monitor the program.

Economic and Financial . As reflected in the previous sections, expenditures for SWM remained to be

small. Further, the government subsidizes such expenditures. Only few local government units collect fees for garbage disposed by households. As such, the limited financial revenue and sources of the local government units spend for solid waste management has hindered the provision of adequate service for waste management. Expenditures have been limited to household collection, transportation to disposal facilities and minimal operational expenditures to some disposal facilities. The national government on the other hand, does not provide any cost-sharing grants to LGUs to address issues on solid waste management.

Background information about the Waste Problems in the Philippines

MARKET ANALYSIS

With 12.5 Million Tons annually being generated at the National level and 2.5 Million tons /year in Metro Manila with only 13 % being recovered and reused and with the allocated budget for each local government units at 25% of their annual budget to dispose of their MSW without recovering the full cost of their garbage collection and management service, the Material Recovery Facilities being in place at present are nothing as compared to the expenses incurred by each towns and cities in the solid waste management. Added also to the fact the landfills and dumpsites cause so much health and environmental hazards to the community.

Background information about the Waste Problems in the Philippines

These are the main landfill environmental problems: Emissions from landfill are the biggest environmental problems.

These landfill problems can be categorized as follows: Emissions to atmosphere Noise, dust, odor and possible bio-aerosols, predominantly from landfill site operations; Landfill gas – from soon after opening and for possibly several hundred years thereafter. Emissions to water. These comprise the potential emission of leachate and contaminated surface water turn-off to:

Watercourse (ditches streams, rivers etc) Groundwater in permeable strata below the landfill.

What about the Philippine Energy Sector?

Energy drives the economic engine for Philippines growth. Currently, the Philippines dependent on the outside for nearly all of its petroleum needs and has been unduly exposed to fluctuations in oil price. The shortfall between primary energy production and energy consumption shows that 63% of the Philippines’ energy needs to be imported. The sharp increases in oil prices in the first half of 2009 have sparked a renewed interest in renewables and even nuclear energy drives economic growth.

The Philippine Energy Plan indicates additional capacity requirements of 5,393 MW of power for the period 2009-2012. For the Philippines, oil is the dominant fuel, accounting for an estimated 55.9% of 2007 primary energy demand (PED), followed by coal at 23.9%, gas at 12.4%, and hydro-electric energy at 7.8% of PED. The country's 8.6TWh of hydro demand in 2007 is forecast to reach 11.0TWh by 2012, with its share of the Asia Pacific hydro market falling from 1.06% to 0.75% over the period.

Entire RP power grid unstable - National Grid Corp By Donnabelle Gatdula (The Philippine Star) Updated March 04, 2010 12:00 AM

MANILA, Philippines - The entire Philippine grid – not just Mindanao – has turned out to be unstable, with power plants bogging down one after another.

In a report, the National Grid Corp. of the Philippines (NGCP) said reserves in the Luzon and the Visayas grids normalized on Tuesday only to get depleted again yesterday.

The Luzon grid succumbed yesterday to generation deficiency of 236 megawatts as the 3150MW Masinloc 1, the 180-MW Calaca 2, and the 260-MW Sta. Rita 30 plants remained inoperational. With available capacity of 6,585 MW, the Luzon grid’s peak demand reached 6,821 MW.

The NGCP said hydroelectric power plants are running with limited capacities due to the steadily falling water levels at reservoirs.

Greenergy’s Proposed Cause of ActionProposal and Consideration: the Zero Waste

Philippines Project….  Greenergy Solutions Inc. is proposing to install, operate and

manage Waste-to-Energy (WTE™) Gasification facilities in cities, municipalities, industrial zones, malls, hospitals, and mining firms all over the Philippines in ten (10) years . The WTE facilities have the capability of initially processing 1.0 ton to 500 metric tons per hour of MSW and generating 2 to 50 Megawatt of electric power to will go directly to the national grid..

With the WTE™ facility being installed once collected and

hauled, the MSW are delivered to these Facilities, these facilities process the MSW, generating electricity which is sold to the rural electric cooperatives at a cheaper price. Tipping fees are currently being paid at Php 800 to Php 2000 per ton of Municipal Solid Waste delivered to the facilities. The other end products such as potable water and inert ash shall be sold as well as additional sources of revenues.

Also, with these Facilities in full operation and being registered

as a Clean Development Mechanism (CDM) project activity that reduces GHGs emission or removes GHGs by sinks, it is entitled to one (1) CER for very ton of CO2 equivalent reduced or sequestered. CERs are marker products which are allowed to be traded. Greenergy Solutions Inc. shall enter into a Emission Reduction Purchase Agreement with buyers which could be governments, corporations and brokers. The money received from sale of CERs becomes a source of additional cash flow for the project. The Philippine government has set up CDM funds for green credits.

The Blue Print: The Greenergy Solutions Inc. 10-year Plan The Project involves the construction

and operation of Waste-to-energy Facilities with a minimum of 10 MW net electricity output gasification plants that process municipal solid waste to produce electricity that would be supplied to the national grid.

The project will generate CERs because it: (1) displaces grid electricity generated from fossil fuels and (2) eliminates methane emission from biomass, which was previously land filled and left to decay.

Development strategies in the Philippines

Greenergy Solutions Inc. intends to seek strategic partners as investors all over the world who can benefit from the green energy generation, carbon credit offsets, fuel supply or are seeking a way to invest in green investments showing a good return.

The Zero Waste Sustainable Development Philosophy

Why Zero Waste? Greenergy Solutions envisages to implement the Zero

Waste Sustainable Development Philosophy. This requires that the concept of “waste as rubbish” be replaced with the concept of “waste as resource”. Greenergy would prove that the waste stream turns into reusable and valuable resources.

Greenergy’s Sustainable Zero Waste Philosophy is… the recycling of all materials

back into nature or the marketplace in a manner that protects human health and the environment;

the conversion of any carbon-based materials are converted into a vitrified glass. Molten metals are separated from the glass and recovered. Non-carbon feedstock are converted into saleable products with nothing leftover. There is virtually no need for a landfill with the process;

Heat from the process is used internally to produce electricity, distill HCL /desalinate sea water.

Greenergy’s road map:With this roadmap,

“Zero Waste Philippines Project” Greenergy Solutions Inc. has programmed the Philippines a waste free country and easily eliminate the serious and costly environmental problem pertaining to wastes that previously dumped at landfills and dumpsites.

The Project strategies

Greenergy envisages that each generation plant or a group of generation plants would establish a Special Purpose Corporation attract different investors such as green investors , carbon financing firms , local government units, mining companies, utility companies, and investment funds or individual funds.

The world demand for energy is rising rapidly and is expected to continue to grow; and the world economy is dependent on fossil fuels for energy. In connection with our economic growth , our environment and our survival as a people, there is a need to look for alternative sources of energy;

One potential solution is to use municipal solid wastes, which, for all practical purposes is a renewable commodity, for the generation of electricity.

Analysis shows that gasification of municipal wastes, even after 30% of the waste was recycled, could provide as much electric power as eight large nuclear or coal generating stations.

Greenergy Solutions Inc. offers an environmentally friendly green technology program that will eliminate garbage and eliminate landfill dumps while producing valuable by-products, such as, electricity for thousands of homes all from disposing of municipal solid waste.

The world demand for energy is rising rapidly and is expected to continue to grow; and the world economy is dependent on fossil fuels for energy. In connection with our economic growth , our environment and our survival as a people, there is a need to look for alternative sources of energy;

One potential solution is to use municipal solid wastes, which, for all practical purposes is a renewable commodity, for the generation of electricity.

Analysis shows that gasification of municipal wastes, even after 30% of the waste was recycled, could provide as much electric power as eight large nuclear or coal generating stations.

Greenergy Solutions Inc. offers an environmentally friendly green technology program that will eliminate garbage and eliminate landfill dumps while producing valuable by-products, such as, electricity for thousands of homes all from disposing of municipal solid waste.

Greenergy’s Roadmap Greenergy Solutions Inc. shall install, operate, and manage the

gasification facilities nationwide. Greenergy Solutions will initially identify provinces, towns, cities and other entities in the Philippines where to install and operate the Facilities; it shall draw the 25 year Comprehensive Management and Operations Plan for the W2e Power Facilities in the Philippines; it shall be in charged in the procurement of government licenses, permits and other requirements. It is understood that the full operation commences when these Facilities are already installed in designated sites nationwide.

Special Purpose Corporations shall be established with Greenergy

Solutions Inc. as the prime mover and sponsor. Private/Public Partnership Agreements shall be entered into between Greenergy and the local government units, and landfill operators.

The Renewable Energy Law …

The Renewable Energy Law of 2008 prioritizes the purchase, grid connection and transmission of electricity generated by companies from renewable sources. Current law ensures a market for renewable energy, and provide a system that will allow consumers to choose green sources of energy in the long term; To encourage the growth of privatized renewable energy projects the Philippine Government has assigned to it “pioneer status” under the Philippine Priority Investment Plan of the Renewable Energy Act of 2008, with numerous fiscal and non-fiscal incentives.

The proposed W2E Facilities would readily enjoy huge advantage in view of the fact that Philippines’ demand for green energy is huge, providing the waste-to-energy facility as competitive. Greenergy is ideally positioned to supply green energy in the market as MSW and other wastes as feedstock are products that are readily available and mandated to be disposed at all costs by local government units such as towns and cities. Greenergy will be able to provide green energy, at a time when the world is seriously addressing greenhouse gas emissions, from a constantly occurring renewable source – MSW (Municipal Solid Waste), making it able to support base load more successfully than any of the alternatives such as solar or hydro electricity.

Under the Renewable Energy Act of 2008, the Philippine government encourages the adoption of Waste to Energy (WTE) Technologies as Renewable Energy sources that complies with the provisions of the Clean Air Act and the Solid Waste Management Act. Section 15 of the said law provides for the following fiscal and non-fiscal incentives of WTE Technology as Renewable Energy Developer, to wit:

Income Tax Holiday for the first seven (7) years of commercial operations; any new technology introduced into the Philippines shall be treated for more fresh package of incentives;

Duty-Free-Importation of WTE machineries, equipment and materials within the first ten (10) years upon the issuance of the Certificate of Greenergy Solutions Inc. as a Renewable Energy (RE) developer;

Special Realty Tax Rates on Equipment and Machineries being used in the operation;

Net Operating Loss Carry Over (NOLCO) - the NOLCO of Greenergy company as RE developer during the first three (3) years from the start of commercial operation which had not been previously offset as deduction from gross income shall be carried over as a deduction from gross income for the next seven (7) years of consecutive taxable year immediately following the year of such loss;

Corporate Tax Rate of 10% on its net taxable income after the first seven (7) year of Income Tax Holiday ;

Zero Rated Value Added Tax Rate – the sale of power generated from the WTE facilities is subject to zero rate Value Added Tax;

Greenergy as RE developer is entitled to zero rated Value Added Tax on all purchases of supplies, materials and services;

Cash Incentives to RE developer for Missionary electrification—the Project shall be entitled to a cash-generation based incentive per KWhr rate generated equivalent to 50% of the universal charge for power needed to service missionary areas where it operates to be chargeable against the universal charge for missionary electrification

Current fiscal incentives are available for waste to energy foreign investments. Alternative scenario has been drawn up which sets higher targets for WTE’s capacity based on the realization of market based industry and the availability of new international financing schemes to support WTE based capacity.

Pilot projects… 

Pilot projects shall be established in five (5) sites, to wit:

Cavite, Philippines – designated as Cavite W2e™COR™ Gasification Facility, with a capacity of 1 000 tons per day. Phase I will be implemented within 18 months. Preliminary Front End Engineering design are now ongoing. Also, the application for clean development mechanism (CDM) has been filed. The Site is located in Naic, Cavite. The MSW were collected and hauled from adjacent seven (7) towns of Cavite province. The site covers a one hectare parcel of land. The proposed project will generate 20 MW of green energy. Phase I would dispose 500 tons of MSW per day. Phase II will start when Phase I has start operating in five (5) months.

Laguna, Philippines – designated as Laguna BOS Gasification

Facility with a capacity of 500 tons per day. Site initial activities include reconnaissance survey, preliminary front end engineering design are now ongoing. The project is expected to be commissioned on May 2010. Proposed project will generate 10MWe green energy

Tarlac, Philippines –designated as Tarlac COR™ Gasification

Facility with a capacity of 500 tons per day. Preliminary front end engineering design starts on May 2010. Commissioning is within 20 months.

Benguet, Philippines- designated as Benguet COR™

Gasification Facility with a capacity of 500 tons per day. Preliminary front end engineering design starts on May 2010.Commissioning starts on July 2010. Proposed project will generate 10 MW of green energy.

Investment Advantage Under the Philippines’ Medium

in the environmental protection are offered key support and considerable benefits from the government. The “Waste2Energy Process Systems” meets the aims and objectives of the country’s Medium Term Plan and as a result enjoys very favorable market condition in the Philippines. The W2E Technologies safely disposes of Municipal Solid Wastes, remediate’s and reduces pollution and assists greatly in the remediation of air quality.

Philippine Government Incentives and Supports

The Philippine Renewable Energy Act of 2008 provides “Pioneer” and “Priority Investment” status to the proposed gasification projects of Greenergy as Renewable Energy projects and is designed to spur investments in the renewable energy sector with incentives.

The incentives include (1) a seven-year tax holiday; (2) no tax on the sale of carbon credits generated from renewable energy sources ; (3) a 10-percent corporate income tax thereafter; (4) a 1.5- percent real estate tax cap on the original cost of equipment and facilities used to produce renewable energy (5) Custom duties are zero rated on equipment and facilities to be used in the Renewable Energy Projects; (6) The law also prioritizes the purchase, grid connection and transmission of electricity generated by companies from renewable sources, and exempts power generated from these sources from value- added tax, and custom duties, these measures will ultimately ensure a market for renewable energy, and provide a system that will allow consumers to choose green sources of energy in the long term.

FINANCIAL PROJECTION. The financial return on operating a Waste-to-Energy Facility are computed based on the prevailing price of the following:

1. Wholesale Electricity Prices: Price of electricity will be in accordance with the regulated tariff for renewable energy generated which is lower than the energy sold by other power producers because the operating cost is lower in view of the legislated fiscal and non-fiscal incentives it got from the government in accordance with the existing laws recently passed by the Philippine Legislature.

2. Number and Size of Generation Plants. The modular designs allows for flexibility in applications from 1 ton to 500 tons per day of Municipal Solid Wastes and a power capacities from 2 MW to 24 MW of electricity generated. A 500 ton per day Mixed and unsorted waste to be treated will generate 10 MW of green energy, 8.5 MW goes to the grid for electricity consumers.

3. Price of Carbon Credits. Compared to the status quo, the proposed projects will result in a very large reduction in greenhouse gases (GHGs) that cause global warming. The reduction in GHGs will come from three main sources. First (and primarily), from eliminating methane (CH4), which is the main component of landfill gases and is 21 times more potent as a greenhouse gas than CO2; second, from offsetting electricity that would otherwise be generated by burning fossil fuels; and third, from recycling the bottom ash and the metals, glass, and brick recovered from the bottom ash. Greenergy Solutions shall monetize this annual reduction in GHGs by selling the associated carbon credits on the international market.

4. MSW Tipping Fee: Fees that can be earned for accepting waste as against alternate disposal options will determine the price the company can garner for accepting various wastes. Tipping fee being paid at present ranges from Php 150.00 to Php 2000. This fee depends on the distance of the disposal facility like dumpsite of landfill.

5. Sale of other End-products, like potable water, and ashes use for concrete works, metals, glass;

 

The Zero Waste Philippines …Is our commitment to our children’s future ;

Sustainable development implies providing the needs of the current world populations without compromising future generations. Our solutions and technologies allow communities to enhance their sustainability level by turning their waste streams into reusable and valuable resources.

for information:Ruth P. BrionesChairman/Chief Executive OfficerGreenergy Solutions Inc.Tel. No. +632 430 17 25Email Address: gsiwte@gmail.com ; g-nrgphils@hotmail.comWebsite: www.greenergyph.com

Genesis 2:4-15“ then the Lord God planted a garden in Eden, in

the East, and there He put the man he had formed, He made all kinds of beautiful trees grow there and produce good fruit. In the middle of the garden stood the tree that gives life and the tree that gives knowledge of what is good and what is bad.

A stream flowed in Eden and watered the garden; beyond Eden it divided into four rivers.

Then the Lord God placed the man in the Garden of Eden to cultivate it and guard it.”