En­er­giz­ing a na­tion

Business World - - SPECIAL FEATURE -

ELEC­TRIC­ITY CON­SUMP­TION in the Philip­pines con­tin­ues to grow ev­ery year, and in 2017, it reached a new peak of 94,370 gi­gawatthours (GWh), lat­est data from the Depart­ment of En­ergy ( DoE) shows. But con­sump­tion growth in 2017 slack­ened con­sid­er­ably to 3.9% from 10.2% in 2016.

Among the fa c tor s that con­trib­uted to the large in­crease in power con­sump­tion in the lat­ter year were “the in­crease in tem­per­a­ture and uti­liza­tion of cool­ing equip­ment ag­gra­vated by the strong El Niño, the con­duct of Na­tional and Lo­cal elec­tions dur­ing the first half of the year, in­crease in eco­nomic growth, and en­try of large power gen­er­at­ing plants,” the DoE said in its 2016 Philip­pine Power Sit­u­a­tion Re­port.

The res­i­den­tial sec­tor ex­pended 26,782 GWh of elec­tric­ity last year, mak­ing it the main driver of elec­tric­ity con­sump­tion in the coun­try. Mean­while, the com­mer­cial and in­dus­trial sec­tors, con­sumed 22,768 GWh and 25,573 mil­lion GWh of elec­tric­ity, re­spec­tively.

When it comes to power gen­er­a­tion, the coun­try is still re­liant on coal; this source ac­counted for 46,847 mil­lion GWh or 49.6% of the to­tal gen­er­ated power. But it man­aged to sub­stan­tially re­duce the power it gen­er­ated from oil, from 5,661 GWh in 2016 to 3,793 GWh in 2017.

Mean­while, power gen­er­ated from nat­u­ral gas in­creased 3.5% from 19,854 GWh to 20,547 GWh. But the growth of power gen­er­ated from re­new­able en­ergy sources — from 21,979 GWh to 23,183 GWh — was big­ger at 5.5%. In­trigu­ingly, the coun­try gen­er­ated less power from geo­ther­mal (from 11,070 GWh to 10,270 GWh) and wind (975 GWh to 690 GWh), and more from hy­dro (8,111 GWh to 9,605 GWh), biomass (726 GWh to 1,335 GWh) and so­lar (1,097 GWh to 1,283 GWh) sources.

“Coal re­mains the main sup­ply for our baseload and we also rely on indige­nous sources such as the Malam­paya gas and con­ven­tional re­new­ables such as geo­ther­mal and hy­dro,” Mer­alco Pow­erGen Corp., the power gen­er­a­tion arm of Manila Elec­tric Co. ( Mer­alco), said. “Re­cently, there is a sig­nif­i­cant en­try of vari­able re­new­able en­ergy such as so­lar, wind, and biomass.”

“A re­view of the last 40 years shows that the gov­ern­ment steered the in­dus­try with the goal of achiev­ing en­ergy se­cu­rity by re­duc­ing de­pen­dence on oil, in­creas­ing our indige­nous en­ergy, and pur­su­ing diver­sity of sup­ply,” the com­pany added.

Ro­ge­lio L. Sing­son, pres­i­dent of Mer­alco Pow­erGen, noted in an in­ter­view with Busi­nessWorld that the share of so­lar may still be small but it may sig­nif­i­cantly in­crease in the com­ing years.

When it comes to power gen­er­a­tion by grid, Lu­zon came out on top with 68,512 GWh, an amount dwarf­ing Visayas’ 14,054 GWh and Min­danao’s 11,804 GWh.

The coun­try’s in­stalled gen­er­at­ing ca­pac­ity went up 6.1% from 21,423 megawatts ( MW) in 2016 to 22,728 MW 2017. This ca­pac­ity came mainly from coal (8,049 MW) and re­new­able en­ergy sources ( 7,079 MW). The rest came from oil (4,153 MW) and nat­u­ral gas (3,447 MW). De­pend­able gen­er­at­ing ca­pac­ity also rose from 18,346 MW to 20,515 MW

Mr. Sing­son pointed out, how­ever, that many of the coun­try’s power plants are old — about 60% of them have been in ex­is­tence for 15 years or more. “Typ­i­cally you can pro­long the life of a plant for 10 to 15 years from the con­ven­tional 30 years. But as a plant gets older, it be­comes less pre­dictable,” he said, adding that it also be­comes less ef­fi­cient. This un­pre­dictabil­ity and in­ef­fi­ciency can re­sult in un­planned out­ages.

Mer­alco Pow­erGen aims to im­prove the sit­u­a­tion by build­ing two tech­no­log­i­cally ad­vanced coal-fired power plants in Que­zon prov­ince. One is a 455 MW plant lo­cated in Mauban, which, upon com­ple­tion, will be the first power gen­er­a­tion fa­cil­ity to uti­lize su­per­crit­i­cal tech­nol­ogy. The other one is a 1,200-MW ul­tra­su­per­crit­i­cal plant that will rise in Ati­mo­nan. These coal-fired power plants will op­er­ate at higher tem­per­a­tures and pres­sures com­pared to sub-crit­i­cal power plants, al­low­ing them to achieve higher ef­fi­cien­cies and re­duce their car­bon diox­ide emis­sions. ( The com­pany is also look­ing at a num­ber of so­lar and en­ergy stor­age projects.)

To be able to meet the grow­ing power de­mand more cost- ef­fec­tively and sus­tain­ably, sev­eral crit­i­cal is­sues must be tack­led, in­clud­ing bu­reau­cratic red tape. “In fair­ness, the en­ergy di­rec­tion, poli­cies are in place,” Mr. Sing­son said, “but pro­cess­ing re­mains a headache.”

Mer­alco Pow­erGen is call­ing on the gov­ern­ment to stream­line the pro­cess­ing of gov­ern­ment per­mits and li­censes to shorten the four to six years it cur­rently takes be­fore a power project can be car­ried out. The com­pany also sug­gests re­assess­ing the reg­u­la­tory ap­proval process to the re­duce the amount of time — al­most two years — that the En­ergy Reg­u­la­tory Com­mis­sion takes to ap­prove power sup­ply agree­ment.

“The gov­ern­ment should let the power mar­ket work as in­tended by EPIRA whose prin­ci­pal re­form was to trans­form the in­dus­try from a sell­ers mar­ket un­der a gov­ern­ment monopoly ( Napocor) to a buy­ers mar­ket where DUs (dis­tri­bu­tion util­i­ties) and Con­testable Cus­tomers are em­pow­ered with choice and com­pe­ti­tion,” the com­pany added.

EPIRA stands for the Elec­tric Power In­dus­try Re­form Act of 2001, while Napocor stands for the state-run Na­tional Power Corp.

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