Introducing the Local Utility Project Accelerator (LUPA)
LUPA is an emerging blended finance initiative seeking to support local utilities or “electric cooperatives (ECs)” in the Philippines to invest in, own, and benefit from renewable energy (RE) projects. LUPA aims to be a bridge to connect ECs with the development and financing resources they need to move RE projects forward.
Addressing Barriers
ECs are a special type of utility designed to bring energy infrastructure and development to remote areas of the 7,000 island Philippine archipelago. ECs operate as non-profit, membership-based electricity providers that have the potential to offer community-driven solutions to unlock RE at scale across the Philippines. Increasingly severe climate impacts and recent policy progress, including a Renewable Portfolio Standard (RPS) with mandated targets for all utilities, have created urgency for ECs to increase RE use.
However, individual ECs face a range of barriers, including: identifying project development and financing resources, overcoming perceived risks, and connecting with RE developers/investors, capital providers, and other partners to scale clean energy solutions. With technical and financial support, ECs have significant potential to contribute to the Philippines’ goal of achieving 35% RE by 2030. LUPA is specifically designed to meet the needs of ECs and expand local communities’ access to sustainable, affordable, reliable energy.
Offering Solutions
Allotrope’s Local Utility Project Accelerator seeks to bring together development and financing resources to help ECs invest in and ultimately own RE projects. LUPA utilizes a blended finance approach to offer a new business model for ECs that have historically focused on local transmission and distribution. LUPA serves as an aggregation manager for engaging ECs, managing stakeholder relationships, supporting ECs’ project development and financing needs, and connecting ECs with RE investors, banks, technical assistance programs, and project-specific development resources to unlock and scale RE projects. LUPA enables ECs to meet and exceed their RPS targets, reduce perceived project-specific risks, attract competitive financing, and maximize cost savings to enable delivery of clean, low-cost electricity to the households they serve.
LUPA is poised to play a critical role in supporting ECs across the Philippines to unlock the anticipated 9,000MW of new RE capacity that will be needed to meet an ambitious RPS scenario and the Philippines’ national goal of 35% RE by 2030. LUPA supports improved climate and development outcomes, while enabling ECs to pursue self-generation and asset ownership as a pathway towards greater resilience and reliability, a key issue for a highly-vulnerable country that is in the crosshairs of climate change and severe natural disasters.
In the words of Atty. Monalisa Dimalanta, Energy Regulatory Commission (ERC) Chairperson, “At this pivotal moment in the Philippine energy transition, LUPA is a bridge to help ECs realize their RE potential. LUPA fills a gap in the market by aggregating and connecting ECs with the development resources, funding support, and technical partners they need to reach their goals and access the benefits of a sustainable energy future.”
Next Steps for LUPA
After successfully completing a feasibility study and design process in 2020-2021, LUPA has entered its Proof of Concept phase and is facilitating its first EC RE projects. Funding support from Convergence played a key role in LUPA’s feasibility study and is providing foundational support for this next phase of work. The LUPA team is deepening and expanding engagement with our network of stakeholders and has launched a new local corporate entity named Kapuluan Renewables to advance the initial EC RE transactions.
The Allotrope team is actively seeking support from investors, donors, and a range of development and financing partners to build upon our momentum and enable LUPA to scale RE across the Philippines.
After demonstrating success with its initial pipeline of RE projects, LUPA will expand support for additional partner ECs, including in off-grid areas, to further replicate and scale clean energy infrastructure. LUPA seeks to unlock hundreds of MW of RE projects by 2030 and expand access to clean, reliable, affordable energy for local communities across the Philippines.
Contact Us
Allotrope is growing our ecosystem of investors, capital providers, donors, developers, ECs, and others interested in supporting LUPA. Please contact us below to explore partnership opportunities: