By Myrna M. Velasco 

‘Green energy taking the epicenter of transformation’ is all too-familiar script in policy agendas. Yet, for a company turning that vision into a reality and having the foresight and willpower to take initiatives ahead of the rest would spell the difference.

Claiming moral high ground to crack people’s ‘old habits’, especially when it comes to senseless disregard and wastage of resources in energy usage is indeed a lofty aspiration. But Aboitiz Power Corporation (AP), through its Cleanergy brand, is out to prove that it can buck the odds – that given the mounting stimulus for Filipino consumers “to go green”, they will in time, embrace such option as part of their lifestyle changes.
 
In a nutshell, Cleanergy is a value proposition to the electricity consumers for a “better future”, explains AP president and chief executive officer Erramon I. Aboitiz in an exclusive interview. By that, he means giving the consumer an option to patronize as well as make a statement that there is value in sourcing one’s power supply from clean and renewable energy (RE) sources. The clincher, he believes, will be for these end-users realizing eventually that they are also contributing greatly to the noble cause of preserving the environment.
 
“Our long-term vision is a change in lifestyle, that’s what we are trying to achieve. So, we’d like to start by making people aware what Cleanergy is all about – the value proposition of clean and renewable energy and what it does for the consumer on a long-term ” Mr. Aboitiz enthused.
 
‘Cleanergy’, is the brand coined by the Aboitiz group for the energy it has been selling from its portfolio of RE sources like those from hydro and geothermal power generation. To date, 42% of the power company’s attributable capacity is being offered to interested end-users under the brand.
 
 
Stimulating brand awareness
 
 
To the ordinary Filipino consumer, how exactly can one relate to the Cleanergy brand? The harbinger-company’s vision is to have it likened eventually to “Coke” or “Colgate” of the basic commodities, or the ‘fast food of choice’ McDonalds (if you want to refer to it globally) or Jollibee (to the Filipino taste). Or better yet, like the Aboitiz group’s very own “Superferry” in the shipping industry. What all of these have in common? All are brand names or industry trademarks that literally turned into household names.
 
Only in energy, it involves dealing with a bewilderingly complex industry. Electricity prices and irritating brownouts may have always been gut issues, but introducing a brand name in this sector is almost highly-impenetrable in the public mind.
 
“We want everyone to know that they have a choice. It is their decision whether or not to buy and consume Cleanergy. This has been in the drawing board for sometime now, but technically it was not possible. Today with open access very imminent, it will soon be a reality,” Mr. Aboitiz said.

At this point, he noted that, determination is the key when it comes to raising people’s consciousness about renewable energy and the ensuing technologies that shall underpin wide-ranging development and their future introduction into market.
 
Yes, the company faces Herculean task as far as making its energy brand known to the consumers, more so, to turn it into another well-recognized trademark. Regardless of the hurdles though, Mr. Aboitiz believes that they can work their way into finding the right strategy to achieve that goal.
 
“We have a culture of innovating, we have a culture of looking for better ways, and we would want to apply that to Cleanergy. What that will end up being, frankly I cannot tell you today. But definitely, we will find innovative ways to get there,” he stressed.
 
“Rome wasn’t built in a day,” he reasoned, but if it is any consolation, “what we thought to be a long process months ago has gotten shorter”. So far, the policy springboard to shore up interests in green energy on a grander scale had been perfectly cast with the on-going implementation of the Renewable Energy Act.
 
 Guarantee seal
  
The Aboitiz group is indisputably not “new” in this branding game. If its “Superferry” test case would be taken as a reference, experience may hold sway and it can count on that for bargaining chips that can ensure its Cleanergy’s foothold in the envisioned competitive power market.
 
Latching on the company’s slogan of “Passion for Better Ways”, Mr. Aboitiz emphasized that they will re-employ best kept strategies that propelled their other businesses into high gear – be it in shipping, banking, food, land or even in power distribution.
 
Bringing the brand to the customer, Mr. Aboitiz added, goes beyond telling the people what are the benefits of RE or clean energy; or merely advertising halcyon images, say of wind turbines, being the next technologies to watch out for with the RE invasion.
 
The customers, he said, should have actual experience of contracting or sourcing that power from RE producers or for the distribution utilities (DUs) serving them to provide that from their supply portfolios – for only then they can bear witness as to the real benefits of taking the ‘green option’.
 
Aboitiz Power intimated that its ‘brand promise’ is better solutions.  This practically motivates the company to actively develop and offer effective energy solutions to help meet the country’s energy demand while building on the commitment to sustain the Earth’s resources.
 
The first customer to sign up for Cleanergy is San Fernando Electric Light & Power Company Inc. (SFELAPCO), a private distribution utility in Pampanga. For having the first crack at introducing ‘Cleanergy’ to its customers, SFELAPCO will also need to “live through” several pioneering efforts into promoting the brand – to literally bring it to customers’ doorsteps.

In the distribution firm’s to-do list include integrating the “Cleanergy” seal in the bills; and for end-users to be aware that patronizing the RE option still turns out economically sound to consumer’s pockets because of the value added tax (VAT) zero rating privilege. Consequently, this will reduce the generation cost component of RE supply by 12% as compared to electricity generated from traditional fossil fuels.
 
The plan to put “Cleanergy” logo in the electric bills, according to Mr. Aboitiz, takes root from “the idea of having some sort of campaign to let people know about it. Hopefully, it will serve as a catalyst for people to start asking what is Cleanergy, we want to "get it", and what it means to us if we buy power from renewable sources.”

Given the company’s diversified supply portfolio, AP is assuring that the contracts it will sign under Cleanergy come with a guarantee seal that the supply will not only be available at the agreed price and terms – regardless of the intermittent nature of the hydro sources or whatever happens to prices at the Wholesale Electricity Spot Market, but also that the power will be sourced from renewable resources.

“The advantage we have as a group is that, the power we are selling is not just coming from one plant, it’s from a portfolio of assets. So when we sell to you, we can guarantee that the power is available, and can assure you that every single kilowatt hour is genuinely renewable,” the company chief executive stressed.
 
 Power of choice
  
The ‘branding play’ is seen as the next big trend in the deregulated electric power industry. It will be ushered in by the much-anticipated onset of market competition via open access, or the regime that will finally put the customer at the head of the table when it comes to decision on his/her “choice of power supplier”. The kick-off phase for this market policy is second quarter this year; or even earlier if the Power Supply Option Program (an interim open access), which is due for implementation starting this March, will be taken into account.

With open access, Mr. Aboitiz is eyeing that this will open new opportunities for them to sell to individual customers, starting with big-ticket buyers like industries (i.e hotels, restaurants and commercial establishments).
 
Apart from competition, there are more reasons for clean energy producers to be optimistic about the future – given the additional set of incentives provided under the RE Law, paving the way for policies on ‘green energy option’; feed-in-tariff (FIT) and renewable portfolio standards (RPS), among others. These are just some of the perks provided in the law to stimulate RE investments and to guarantee that electricity generated from alternative sources would not be cost-prohibitive when offered to consumers.  
 
The ‘green energy option’, in particular, perpetuates demand-side management -- it empowers the customer to practically dictate on the distribution utilities serving them that what they want would be electricity supply from clean and renewable energy sources.
 
“The real exciting one is the green energy option. It would be a powerful impetus to build on the demand for Cleanergy,” the AP chief executive reckoned.
 
By then, he said, “the customer ultimately decides what he wants. So really, this is the power of the customer, the power producer will generate electricity based on what the customer wants.”
 
The parallelism he cited has been the growing appetite of customers for hybrid or green cars, and he sees the same thing happening when it comes to patronage of clean energy solutions. “It’s like what’s happening with hybrid cars, you have customers saying: I want my next car to be hybrid, so I’ll buy a Prius. If customers make that decision, then the car companies would have to produce cars that way.”
 
AP sets out preferred outcome coming in two ways: first, for the customer to directly buy power from its Cleanergy offer; and second, for people to patronize establishments utilizing ‘Cleanergy power’ in manufacturing their products – be that for clothes, shoes or basic commodities that sustain human’s daily existence.
 
“Later on, we want Cleanergy to make it more than just buying clean power from us, we also foresee that people will patronize the brand by buying products or going to malls or businesses that consume Cleanergy,” Mr. Aboitiz said.

 Competition and synergy
  
Being ahead in the branding race does not necessarily give this company the feeling of having a head start in the game – it actually hankers for competition to stir up customer excitement, and for the end-users to eventually differentiate between renewable and non-renewable energy sources based on what they see as market offers.
 
An Aboitiz philosophy, the company chief executive shares, is this: “We don’t want to be a big fish in a small pond, we want to be a small fish in a big pond. We want to rise with the tide, we don’t want to rise by ourselves because that’s going against gravity.”
 
He pointed out that “competition” is the healthiest thing that could ever happen in a free market, because it not only drives people to excellence and better service, it also offers choice to consumers. “If competition comes, we will be very happy because that means, more people want Cleanergy, to us that will be real success.”
 
In the longer term, it is not also discounting potential synergies with other players, like Luzon’s biggest distribution utility Manila Electric Company (Meralco) or with other power producers who want to explore marketing opportunities for their RE-generated power.
 
 Legacy for the next generation

Without capacity displacement of the traditional fuels in the power mix, AP considers the entire thing to be nothing but a zero-sum initiative. Thus, it noted that ultimately, it wants to measure success by the number of new RE plants to be built or the capacity added with Cleanergy gaining traction in the market.
 
And beyond the need for the commodity, the company essentially puts more premium in helping preserve the environment as legacy for the next generation.
 
Mr. Aboitiz was enthusiastic in imparting this view: “Never mind about yourself, you can live happy this time. But think of the next generation. Hopefully, if we act fast enough, the next generation will tell us: thank you for doing your share. What we don’t want to happen is that they look at us and say: look, what you’ve done to us, you were selfish, you’ve wasted resources, it’s unfair!”

More than anything, he stressed that “we have only one Earth and it is not getting bigger.” This generation, like it or not, ought to live with the fact that demand for energy is not likely to abate in the foreseeable future. It doesn’t need rocket science to assume that there would be continuous economic expansion and population boom to chalk up demand growth.
 
If Filipinos don’t change lifestyles today and will just continue destroying or wasting limited resources, remember that there is something very precious being taken away from the next generation. The choices still, are just well within our reach.

·         Originally published at the Manila Bulletin (March 12, 2010) issue.