“We need to modernize our aging infrastructure to reduce transmission losses and enhance service reliability across the country”
While the general power situation has been favorable in the past few days, the recent yellow and red alerts raised in the Luzon and Visayas grids have highlighted the pressing need to bolster our power generating capacities to meet the growing energy demands of consumers and help sustain economic growth.
Luzon’s power demand surged by around 2,400 MW at the height of these grid alerts, breaching the peak demand last year and the peak forecast for this year.
This happened as some 30 power generating plants went on forced outage or on scheduled maintenance – glaring evidence the current crop of generating plants is now unreliable to supply the needs of this nation.
As some provinces experienced rotating power brownouts, consumers were urged by the Department of Energy to avoid the use of high-energy consuming appliances such as air conditioners amid unbearable heat index levels to mitigate the strain on the grid.
Consumers shoulder the burden of addressing these supply crunches and suffer from power interruptions, instead of government solving the main problem which is the lack of additional generating capacity injected into the grid system.
With power demand outpacing available energy supply, the imperative for additional power plants cannot be overstated.
And this is where private sector investments in the energy sector come in.
While there are a few renewable power plants sprouting all over the country, we need 24/7 baseload capacities to really resolve the supply deficit and meet growing demand.
In the near-term, a major incoming baseload capacity injection is the $3.3-billion (P184.89 billion) integrated liquefied natural gas facility of Aboitiz Power Corp., Meralco PowerGen Corp. and San Miguel Global Power Holdings Corp.
Ensuring around 2,500 MW dependable supply by end-2024, this massive project will be a necessary support to stave off power outages and help the nation achieve energy security.
Under the deal, MGen and Aboitiz Power will invest in SMGP’s 1,278-megawatt Ilijan gas-fired power plant and a new 1,320-MW facility slated for completion by the end of the year.
The three companies will then acquire nearly 100 percent of the LNG import and regasification terminal owned by Linseed Field Power Corp., a local unit of global infrastructure firm Atlantic, Gulf & Pacific Co. that received the country’s first LNG cargo delivery in April 2023.
According to the companies, the facility will be used to receive, store and process LNG for the two power plants that supply electricity to the main island of Luzon.
LNG power plants offer a compelling solution to augment our energy portfolio given its inherent versatility, cleanliness, and efficiency, allowing us to diversify our energy sources and, at the same time, mitigate environmental impacts as we push for sustainable energy development.
Based on the Department of Energy’s data, there are several proposed LNG power plants with an indicative combined capacity of 8,000 MW.
They include Therma Subic Inc.’s 1,310-MW project in Pagbilao, Quezon and Quezon Power’s proposed 1,200-MW plant in Mauban, Quezon.
Beyond generation, energy investments should also extend to transmission and generation to modernize and fortify transmission and distribution networks to improve the delivery of power to all consumers.
The recent completion of the Cebu-Negros-Panay 230-kilovolt Stage 3 backbone project of the National Grid Corporation of the Philippines is a welcome development for consumers in Visayas as this will enhance the reliability and efficiency of power transmission in the region.
Investments in distribution facilities should also be prioritized since having efficient distribution utilities will also play a pivotal role in ensuring seamless access to electricity.
We need to modernize our aging infrastructure to reduce transmission losses and enhance service reliability across the country.
But all these efforts will be wasted if there is no seamless synergy between effective governance, strategic infrastructure investments, and forward-thinking policies and the Department of Energy and the Energy Regulatory Commission that are central to this narrative.
We need strong DOE and ERC oversight.
They must meticulously craft and execute a strategic energy blueprint that will work and encourage innovation and progress, instead of discouraging investors and creating uncertainties. (Email: [email protected])
