Festering power problem

from Philippine Daily Inquirer, 11 August 2015

LAST NOVEMBER, President Aquino declared that Mindanao would no longer experience massive power outages in 2015. Speaking at a development forum in Davao, he said that Mindanao’s power generation capacity was on the way to full recovery and that it would attain power security even ahead of Luzon. His optimism was based on reports from government agencies that a number of major power plants would be operating in Mindanao in 2015. Earlier in 2014, various parts of the island suffered power outages of up to 10 hours due to repair work on power plants and the decreasing water level of lakes and rivers feeding hydropower facilities.

More than halfway into 2015, the power situation in Mindanao has hardly changed. Only last month, the water level at Lake Lanao receded and was mere centimeters away from being unable to generate power for the Agus complex. The same was true for the water source of the Pulangi power complex in Bukidnon. The low water levels of the dams cut power supply to some areas, resulting in outages averaging up to four hours. In fact, the whole Mindanao grid was placed under alert after more frequent outages lasting as long as seven hours occurred in the last week of July.

The power deficiency in Mindanao has reached an alarming level. Making matters worse is the threat of a dry spell to be induced by El Niño later this year.

But this problem did not suddenly arise last month. In October 2012, the Philippine Chamber of Commerce and Industry (PCCI) warned that the Mindanao power crisis, which resulted in frequent outages during the summer of that year, was expected to continue until 2015. The “gloomy projection” was disclosed to the PCCI by executives of National Transmission Corp., which said the absence of new baseload plants in Mindanao was the main reason power outages would continue in the South over the next three years. While several power projects in Mindanao have been approved by the Department of Energy, it noted then that none had started, apparently due to opposition or red tape in the offices of the host local governments. Dependent largely on a chain of hydroelectric plants along the Agus and Pulangi rivers, Mindanao did experience regular outages in the summer of 2013 as the drought caused by El Niño hit the region.

President Aquino knew what the root cause of the festering power problem was. The trouble, he pointed out in 2013, began when regional leaders sought to exempt themselves from the Epira (Electric Power Industry Reform Act of 2001), which was meant to restructure and privatize what was then an inefficient and state-owned power industry and to increase competition, with the goal of bringing power rates down.

The President narrated how lawmakers from Mindanao pursued “temporary convenience [that] trumped preparedness for the future,” how the leaders of Mindanao neglected basic market and economic realities, and sought to continue taking advantage of the massive hydro resources in the area with the dangerous assumption that cheap hydro power could last forever.

The Agus and Pulangi power plant complexes have a combined installed capacity of 982 megawatts, drawing energy from Pulangi Dam in Bukidnon and Agus Dam in Lanao del Norte. The Agus power plant complex consists of six cascading power plants from the mouth of Lake Lanao in Marawi City down to the majestic Maria Cristina Falls in Iligan City. Strategically located along the Agus River, the first power plant was commissioned in the early 1950s; the rest started operations between 1979 and 1991. The 255-MW Pulangi power complex in Bukidnon, on the other hand, has three generating units that started commercial operations back in December 1985.

The addition of new baseload power plants in Mindanao, which will be ready later this year and through 2017, will not be enough if the two major but unreliable government-owned power complexes remain in the state’s hands. If that happens, the story will always be the same for Mindanao: Demand for electricity for cooling will spike in the summer months, the regional supply grid will contend with low water levels to run the hydropower plants, and rotating outages will have to be undertaken to distribute the available supply.

It is time to end this recurring story that has stunted the development of Mindanao. The island need not suffer this seasonal supply deficit. The government should take bold steps to privatize the Agus-Pulangi power complexes to make these run more efficiently.

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