Luzon brownouts still possible

by Lenie Lectura, 19 April 2015
from BusinessMirror

The Malampaya natural-gas facility is back online after a 30-day shutdown, and Luzon did not experience any power outage since summer started. But, the energy chief said, the worst is not over yet.

“May is another critical month. It’s something we should look out for,” Energy Secretary Carlos Jericho L. Petilla said at a recent BusinessMirror discussion.

Peak-power demand in Luzon hit 7,000 to 8,000 megawatts (MW) during the maintenance shutdown of the gas facility that fuels three power plants with a total capacity of 2,700 MW, providing about half of Luzon’s power needs. These power plants are the 1,000-MW Santa  Rita, the 500-MW San Lorenzo  and the 1,200-MW Ilijan.

Petilla said peak demand in Luzon next month is likely to reach 9,000 MW. “In May we expect demand to hit 9,000 MW. We are talking about probabilities. We do not discount any brownout. We are dealing with machines here, and they [may] break down,” he said of the power plants that could conk out any time.

The scheduled maintenance shutdowns of power plants had been moved to June and July from an earlier schedule that coincided with the Malampaya maintenance shutoff from March 15 to April 14. Petilla said good weather—cooler climates at the onset of summer—and manageable demand helped prevent brownouts from happening in Luzon.

“This is the only summer I can remember when it still rains in March and there’s a typhoon in April. It’s unusual. This is good because our hydropower plants are not getting dried up. The temperature is also not that high so demand is not yet at its very peak,” Petilla said, adding that this indicates that summer is either going to be short or delayed.

If the season is delayed then this is something Petilla said consumers should be worried about because a delayed summer could coincide with the June-to-July period when many power plants are scheduled to go offline to undergo maintenance work.

Pushing for emergency powers

Preparations to avert or at least minimize power outages have been under way since the third quarter of 2014.

The preparations include granting President Aquino special powers to address the potential power-supply shortage through an enactment of a joint resolution.

But Congress already went on a six-week vacation without passing the proposed resolution.

Petilla could not stress enough the importance of the authority to address a possible power shortage, given that May is a historically critical month due to an anticipated peak demand in power consumption in Luzon and that most of the maintenance shutdowns are scheduled in June and July. The probability that summer could be delayed by a month or so is another factor to be considered.

“It is better to have it when needed rather than need it but not have it. There is a sense of urgency. In the future, we just have to approve or disapprove it instead of debating about it,” he said.

House Energy Committee Chairman Reynaldo Umali, in a phone interview, is hoping that the joint resolution could still be passed in May.

“I am not losing hope. We will resume on May 4,” Umali said.

One of the unresolved issues that pends before the bicameral conference committees at the Senate and the House of Representatives is the cost involved in the interruptible load program (ILP). Under the ILP, big consumers will run their power generator sets instead of drawing from the national grid, in exchange
for compensation.

While the House advocates for the use of the Malampaya Fund as payment for the participants of the program, the Senate panel wants a status quo, which means pass-through costs for consumers.

“If it’s not approved, then automatically it’s going to be passed on to the consumers.

So, if there’s an increase in power rates because of the ILP then the consumers will pay for it. This could trigger an adverse reaction from the consumers,” Umali said.


No need yet for ILP

As power demand in Luzon still remains manageable to date, the DOE and the Manila Electric Co. (Meralco) agree there is no need to implement the program just yet.

“I don’t feel that there is a need to call the ILP yet as we have lots of reserves on a daily basis even during the shutdown of the Malampaya,” Meralco Senior Vice President Alfredo Panlilio said in a text message when sought for comment.

Philippine Independent Power Producers Association President Luis Miguel Aboitiz earlier tagged the April 5 to 15 timespan a critical period.

“As I recall, the need for ILP was anticipated the week after the Holy Week but we were okay,” Panlilio said.

For now, the ILP is the best solution to address a possible power shortage. Petilla is hoping there would be no need to call in the ILP participants. “I want them to be ready but I am hoping that I will not have to call them,” he said.

As of latest, Meralco signed up more participants to the ILP, bringing to 667.29 MW the aggregate committed interruptible load (CIL) for the summer.

The power distributor registered 80 customers from the private sector that will contribute 393.36 MW of capacity. It, likewise, signed up 1.7 MW of CIL from the government sector.

Contestable customer participants, or those with a monthly average peak demand of at least 1 MW, have signed up a total 264.73MW of interruptible load. Of the number, 110.44 MW will come from the different retail electricity suppliers (RES) and 154.29 MW from MPower, the retail electricity supplier unit of Meralco.

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