Coal, hydro plants expected to mitigate Malampaya shutdown

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THE possible uptick in power prices next month due to maintenance on the Malampaya field can be cushioned by dispatching more power from baseload coal and hydropower plants, the independent market operator said.

In November, the Malampaya gas-to-power facility is due for maintenance, which will restrict the supply to natural gas-fired plants and possibly driving up power prices. But the Independent Electricity Market Operator of the Philippines (IEMOP) hopes increases can be tempered by other power sources.

“In that case, we hope na ‘yung malalaking (the big) baseload coal plants na naka-under maintenance ngayon ay tapos na (can complete their maintenance works in time). Otherwise, magkakaproblema talaga tayo (we will have a problem),” said IEMOP Chief Operating Officer Robinson P. Descanzo during a virtual briefing, Wednesday.

“Also, because of La Niña, dampened ang demand and marami tayong tubig, so makakatulong ang hydro, (demand is dampened and water is abundant, so the hydropower plants can help)” he added.

The Wholesale Electricity Spot Market (WESM) charges in September rose to P3.48 per kilowatt-hour (kWh) primarily due to power plant outages. But reduced demand could bring down the October average, the market operator said.

In the first few days of October, the market’s peak demand was 12,259 megawatts (MW), down 5.4% from a year earlier and 327 MW less than the previous month. The market price currently stands at P2.38/kWh with supply at 13,411 MW.

Ang pinaka-main reason na nakikita natin ay dahil mas malamig na ‘yung panahon, then marami na ring mga pag-ulan every day (The main reason for reduced demand is the cold weather and there are rainy days),” said John Paul S. Grayda, price validation and analysis manager at IEMOP.

Power demand remains low as quarantine protocols remain in place, he added.

With La Niña ongoing apart from the quarantines, the IEMOP projects a possible power demand downturn this year.

“We see na ‘yung demand is still ‘di pa rin niya ma-breach ang level last year or mas bumaba siya, magkaroon ng downtrend, (Demand has still not breached last year’s level and could turn lower),” Mr. Grayda said.

The climate event is expected to persist until the first quarter of 2021.

The WESM operator has observed increased power consumption when quarantine protocols are eased. — Adam J. Ang

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