More power plants now on-line (DOE admits summer price hikes)

By Myrna M. Velasco – April 17, 2017, 10:00 PM

from Manila Bulletin

The Department of Energy (DOE) has admitted that summer months will likely drive up electricity rates for power consumers, but earlier forecasts of continued ‘yellow alerts’ had been negated by the agency with the return-to-operation of power plants affected by the swarm of earthquakes in Batangas.

System operator National Grid Corporation of the Philippines (NGCP) issued a modified outlook last week that if the calamity-stricken plants would not be synchronized to the grid soonest, the worst case scenario would be recurrence of yellow alerts until June this year.

But Energy Undersecretary Felix William Fuentebella qualified that NGCP just changed its supply-demand outlook on Monday (April17), following certainty of some plants already getting back on-line. It was shown in a graph that NGCP furnished to media and industry stakeholders last week that even with the Malaya plant running, Luzon grid may experience tight supply condition until June because of the disaster-affected plants – edging into ‘yellow alert conditions’. But obviously, the situation “changed for the better” just this week, according to the energy department.

Fuentebella said the previous forecast can already be ditched, following the return on-stream of some plants at the start of the week.

As of Monday, the generating plants that went back on-line include the 600-megawatt Block B1, B2 and B3 of Ilijan; 250MW of San Lorenzo plant as well as 300MW of the Malaya thermal plant.

The San Gabriel and Avion gas plants of First Gen Corporation are also anticipated to be back on-line this week, as advised to the energy department.

“We are exerting all efforts to enable Unit 50 (of San Lorenzo), San Gabriel and Avion to export their outputs within the coming days. Our site management team and our contractors have been tirelessly working since last week including through the Holy Week break,” First Gen Vice President Jerome Cainglet said.

On Monday, NGCP data showed that system capacity for Luzon grid was at 10,797 megawatts versus peak demand of 9,086MW – thus, providing for a reserve capacity of 1,711MW.

Nevertheless, Fuentebella has not discounted the possibility that as demand would peak on hotter weather during summer months, supply may still turn precarious especially if some power plants would suffer forced outages.

The cost impact, he said, would depend entirely on the distribution utilities or electric cooperatives serving electricity consumers.

“What really affects our consumption is the weather, especially if it’s too hot. We switch on our air-conditioning units more often, so that drives up our usage,” he said.

At this point though, he noted that calculations are still not in, although they have been having a tight watch on how trading prices move in the electricity spot market.