The Philippine Star
The think-tank said with this scenario, the Philippines cannot afford to do nothing.
“The Philippines has a balanced fuel mix today but an uncertain balanced energy future. The Philippines is on the path to having the highest coal share in Asia, despite DOE’s aspiration for a balance fuel mix. If coal projects are implemented as planned, Luzon’s coal generation share will be over 75 percent by 2030 and many coal plants will be uneconomic as a result of low utilization,” it said.
The study stressed that the Philippines urgently needs strong power framework to achieve a balanced power sector fuel mix.
LNG or liquefied natural gas is seen to improve the overall security of supply.
“Gas/LNG is a competitive mid merit generation option which can improve the overall security of supply. At the same time, it can also mitigate environment and economic risks associated with the high coal scenario. If externalities are included, LNG is also a competitive baseload generation option,” IHS said.
LNG is natural gas that has been converted into liquid for ease of storage or transport.
The Energy department is doing something about the country’s power supply situation.
Moving forward, the department wants to push for a bigger share or renewable energy in the fuel mix.
Now under the leadership of OIC- Secretary Zenaida Monsada, the Energy department has issued Department Circular 2015-07-0014, or the “Guidelines for the Policy of Maintaining the Share of RE in the Country.”
According to the Circular, the share of RE should be at least 30 percent. Renewable sources of power include solar, wind, biomass, ocean and hydro.
Based on 2014 power statistics, RE currently accounts for 32.87 percent of the country’s total installed power capacity while the rest are shared by coal, natural gas and diesel.
The 2012-2030 Philippine Energy Plan directs the country in creating a future with less carbon and one in which energy efficiency is a way of life and the use of alternative fuels and renewable energy as intelligent choices.
If and when this is indeed fully implemented, the Philippines would have enough energy to meet demand. But it’s not just any fuel source but the relatively cleaner ones such as LNG, alternative fuels and renewables.
Since the start of the year, the whole energy industry keenly awaited with bated breath, how the summer of 2015 would look like because then Energy Secretary Carlos Jericho Petilla warned of an energy shortage during the hot months.
But whether or not the Philippines survived the hot summer months is only part of the story.
The bigger story for the Philippine energy industry is this: The precarious power supply situation that Petilla had warned would be felt in the summer of 2015 once again put the spotlight on the country’s fuel supply mix and the reliability of the current coal-dominated power supply.
From last year throughout the first quarter of 2015, many of these coal-fired power plants were either on forced shutdown or suddenly had to be on maintenance shutdown, aggravating the Philippines’ already thin reserves.
Fortunately, for the Philippines, renewable energy is gaining ground and its share in the fuel mix is increasing but coal still dominates. To avoid a repeat of the precarious power supply the country experienced last summer, the Philippines needs to balance its fuel mix, experts said.
To many, the summer period was a dreaded situation.
Indeed, no other issue stood out as strongly as the power supply situation even as there were many other developments that happened in the energy sector.
It was in July 2014 when Petillla, who resigned in April, sounded the alarm on a looming power shortage in the summer of 2015. He went on to ask President Aquino to declare a state of emergency or crisis in the power sector to allow the government to tap additional power.
Petilla warned of a projected deficit of 200 megawatts for some days of April and May 2015.
Thus, he said the emergency powers would allow the government, through the Power Sector Assets and Liabilities Management Corp. (PSALM) to contract additional power.
The former Energy chief stressed the measure is necessary to avoid blackouts during the summer of 2015.
In his warnings, he said the Deep Water Gas to Power Malampaya natural gas facility in offshore Palawan had a scheduled shutdown from March 15 to April 14, 2015, which will aggravate the situation.
Emergency powers, he said then, would greatly help fix the problem.
The Electric Power Industry Reform Act of 2001 (EPIRA), the power reform law prohibits the government from constructing power plants.
However, Section 71 of the law states that the President, upon determination of an imminent shortage of supply of electricity, may ask for Congress for authority through a joint resolution, to establish additional generating capacity under such terms and conditions may approve.
The idea is for the government through PSALM to contract additional capacity by renting diesel fuel facilities similar to what Japan used during the aftermath of the nuclear disaster that hit Fukushima, Japan in 2011.
President Aquino heeded Petilla’s proposal and asked Congress to pass a joint resolution granting him emergency powers.
FAST FORWARD TO 2015
Congress did not grant the emergency powers although somehow, Petilla already knew this would happen.
While waiting or perhaps instead of waiting for Congress to pass the resolution, the former Energy chief wasted no time in campaigning to encourage the public to conserve energy.
The Department of Energy launched the campaign dubbed as “Energy Sense, Saves Cents.” Its aim was to raise public awareness on energy conservation.
Through the campaign, the department gave tips on how to conserve energy. One such measure is putting the thermostat of cooling systems to 25 degrees Celsius.
These energy conservation measures helped ease the situation.
The supply situation also improved because the Caliraya-Botocan-Kalayaan hydropower plants and pumped storage in Laguna added 720 MW to the grid following the energization of the Lumban transmission line, which enabled the plant to supply an additional 400 MW to bring its capacity to 720 MW.
Thus, the looming power shortage did not happen, thanks to a late summer, a relatively colder one compared to past years, additional capacity drawn in from the Caliraya plant and the energy saved from the conservation measures.
But the situation does not change the fact that in the long run, the Philippines needs to ensure a more sustainable energy resource and not just depend on coal plants which are now old and aging and have become less reliable.
The Philippine economy, with an average annual expansion of seven percent in recent years, is one of the fastest growing economies in the world. Thus, it needs to achieve a sustainable energy plan, according to global energy think-tank IHS.
In a recent study, it said that Luzon’s coal generation share would be over 75 percent by 2030, posing risks to health and the environment.
In its study Sustainable Energy Transition for the Philippines, IHS warned of a high coal scenario for the Philippines, saying that it poses health and environmental risks for the country.
IHS senior director for Gas & Power James Ooi recently presented the results of the study during a visit to the Philippines.
IHS estimates the health costs from mortality and morbidity impacts due to degrading air quality conditions from coal generation emission without control mechanisms will rise
Fortunately, for the Philippines, renewable
energy is gaining ground and its share
in the fuel mix is increasing but coal still dominates. To avoid a repeat of the precarious
power supply the country experienced
last summer, the Philippines needs to balance its fuel mix,
experts said. to $18 billion by 2030.
Among the health impact of air pollutants from coal include respiratory illnesses brought about by sulfur oxides; cardiovascular and cardiopulmonary mortality, lung and heart disease and premature death from particular matter and ground level ozone, which is corrosive to the lining of the lungs from nitrogen oxides.
DOH Assistant Secretary Paulyn Jean Roselle-Ubial Office for Technical Service also said in a recent paper presented in a Climate Change Forum in the United Kingdom that in the Philippines, four of the ten leading causes of deaths may be attributed to air pollutions.
She said the Philippines must continuously promote clean fuels and technologies, strengthen international transfer of expertise, technologies and scientific data in the field of air pollution and that communities take measures to increase their resilience against the dangerous consequences of climate change that are already inevitable.
“Climate change already is affecting global health. . . . The good news is that clear health benefits are immediately available, . . . from low-carbon strategies that today could result in cleaner air, . . . or to more active transport options that can improve physical fitness, . . . ultimately saving lives and averting disease,” she said.
The IHS said that CO2 emissions specifically from power generation would double that of 2014 in the high-coal scenario, IHS also said.
Furthermore, IHS said in its study, “coal projects are prone to slippages due to the complex nature of project approvals and developments.”
Economic impacts from the risk of unmet power demand associated with coal projects delays are significant, the study noted.
There would be a decrease in average annual regional GDP rate equivalent to the unmet demand rate, resulting in up to 3.9 million opportunities not created by 2025 compared to the baseline assumption where there is no unmet demand, it said.
“High coal share is uneconomic as coal plants are forced to run to meet intermediate load, resulting in low utilization which does not enable adequate recovery of associated capital cost investments,” IHS said in its study.