20-day Malampaya shutdown to cost consumers P3 B

by Myrna M. Velasco –  January 14, 2017, 10:00 PM

from Manila Bulletin

The scheduled 20-day shutdown of the Malampaya gas production facility will cost Filipino consumers P3.0 billion, representing the extent of additional costs they will be paying with anticipated supply tightening and shift move to more expensive fuels of the gas plants.

That is based on the estimate of the Department of Energy (DOE) on the portended P1.20 per kilowatt-hour (value-added tax exclusive) rate adjustment that consumers will bear on the aftermath of the routine maintenance downtime of the country’s commercial gas asset. With VAT, that amount is seen escalating to P1.44 per kWh.

Energy Secretary Alfonso G. Cusi noted that cost for this round of scheduled maintenance is lower compared to the 2013 power supply problematic episode, of which cost impact had been calculated at P10 billion.

Nevertheless, since the price spikes in the Manila Electric Company’s (Meralco) rates at that time had been stopped, the consumers were eventually freed from that financial burden.

Aside from the gas plants that will be out from the system with the January 28-February 16 Malampaya shutdown, other coal plants have also been on pre-set maintenance activities, primarily the Calaca and Quezon Power plants.

Since the gas plants can still run on diesel or other liquid fuels like condensate, the extent of capacity loss in the system will just be more than 2,000 megawatts.

The newly commissioned San Gabriel plant of First Gen, it was noted, will not be running during the shutdown phase of the Malampaya facility, but the 97MW Avion can shift to diesel.

One block of the Ilijan plant will also be running at de-rated capacity; while the Santa Rita and San Lorenzo gas plants will be utilizing condensate to continually supply the grid during the period.

But several other facilities are being lined up to run to ensure that Luzon grid will not suffer power interruptions during the period.

The government itself, through the Power Sector Assets and Liabilities Management Corporation (PSALM), has already committed to run its Malaya thermal power facility at a rated capacity if 470 megawatts.