DOE sets interim circular for energy mix policy

by Myrna Velasco – July 24, 2016

from Manila Bulletin

The Cusi-led Department of Energy (DOE) is issuing a circular to serve as an interim guide for the energy sector while they undertake a comprehensive audit of the power industry’s supply chain that shall underpin the framework for the country’s energy mix policy.

The twin of that edict, according to DOE spokesperson Wimpy Fuentebella, is a Special Order that will flesh out the parameters of the mandated audit of the power industry – primarily coal plants that are sporadically thrown at the center of controversies.


“The circular will take care of the policy, the special order will look into what the task force will be doing,” he said. The audit task force, he added, will be led by the DOE upon the instruction of Energy Secretary Alfonso G. Cusi.

A third party – the Institute of Integrated Electrical Engineers of the Philippines (IIEE) – will be aiding the energy department’s audit task force on this sphere.

Fuentebella noted the technical audit will cover the coal-fired power plants, but it will not be limited to them. It will also examine the other chain of the industry – including power transmission and distribution segments.

When the outcomes of the technical audit will be finalized and submitted to relevant agencies, primarily the Department of Environment and Natural Resources (DENR), Climate Change Commission and the National Economic and Development Authority, the next step, according to Fuentebella, would be “crafting a more balanced energy mix.”

He admitted that while they still take cue from the existing 30-30-30 technology mix of coal, gas and renewables drawn up by the previous administration, the more specific numbers have remained to be a puzzle to them as well – just as how perplexed industry players are today on the proposed energy mix.

“With that (audit), we will have a better picture of what the standards would be for the entire supply chain. We would also be able to determine where to go (for the energy mix),” he stressed.

For coal technology, in particular, their focus would be on technical standards – not just on the level of generation or availability of the power plants, but also on technology utilization as well as the level of their carbon emissions.

Penalty on non-compliance, he said, will come later but relevant laws and rules governing the industry would apply and that due process shall be served to all affected stakeholders and constituencies.

“We’re not after penalizing, existing laws will apply. We are after coming up with a policy so that we will have security of supply as far as the policy is concerned, so we can get into a pricing that will be desirable,” Fuentebella added.

He said the department would be after re-classifying the power plants according to their generation efficiencies, technology use and overall performance.

“Classification will be baseload, mid-range, peaking, but we can also classify them as old and new; good and bad – it will be a fair grading system – penalties will come later but due process will apply,” he reiterated.