Palace updated on power situation

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THE DEPARTMENT of Energy (DoE) said on Monday that the information gathered relating to the incidence of yellow and red alert notices in the past few days, including the data submitted by power generation companies and other energy stakeholders, are for submission to the Office of the President.

Ito lang po masasabi namin, lahat ng impormasyon na makukuha natin ibibigay natin sa ERC (Energy Regulatory Commission), PCC (Philippine Competition Commission), Congress, lalong lalo na kay Pangulo (This is all that I can say, all information that we will be able to gather will be given to the ERC, PCC, Congress, especially to the President),” Energy Undersecretary William Felix B. Fuentebella said in a press conference at the department’s head office.

“At the end of the day, we will remain answerable to all these and we will try to leave you with as many updates, as transparent and as timely as we can.”

Mr. Fuentebella made the statement as the yellow and red alert notices were issued about a month before this year’s mid-term elections on May 13.

He repeated what he said before the thinning supply incidences happened: that there will be ample supply of power during the polls.

“This is the assurance that we are working together and we have to make sure that we talk to the gencos (power generation companies) in a sense that they perform their best especially the engineers and the field personnel to really, to be inspired and work as the best engineer possible because wala naman dapat problema sa supply (there shouldn’t be a problem in supply),” he said.

Beyond the elections, Mr. Fuentebella said the DoE could invoke Section 23 of Republic Act No. 7638 or “An Act Creating the Department of Energy Rationalizing the Organization and Functions of Government Agencies Related to Energy and for Other Purposes.” The provision governs the relationship of the DoE with other government departments when it comes to support for priority energy projects.

“The Department and its priority projects shall enjoy preferential treatment to the exploration, development, exploitation, and extraction of petroleum, coal, and other geothermal resources, and in the matter of providing technical support necessary for the establishment of power-generating plants,” the provision reads.

“Upon request of the Department or any of its bureaus, all government agencies with functions relative to the approval of the projects of the Department or its duly authorized and endorsed entities, whether government or private, shall act upon and resolve the matter within ten (10) calendar days. Toward this end, the Secretary, with the approval of the President, may establish an interagency secretariat for the purpose of expediting the approval of said projects.”

In the near term, the DoE said Manila Electric Co. (Meralco) is entering into an interim power supply agreement (IPSA) with two generation companies that are embedded in the distribution utility’s franchise area.

Emmanuel V. Rubio, Aboitiz Power Corp. chief operating officer, said the contract is for 161 megawatts (MW) with subsidiary Therma Mobile, Inc. (TMO).

“Whatever we can provide before the date of request, before April 26,” he said, adding that the unit offered 200 MW.

A separate 70 MW is to be contracted with Millennium Energy, Inc., which was confirmed by Noemi T. Moreno, an official of Millennium unit Panasia Energy, Inc.

“We offered 70 MW but still subject to testing. We are about to sign it today,” she said.

The DoE called for the press conference on Monday after power reserves thinned all days last week.

On Saturday last week, another plant went on an unscheduled outage, reducing available capacity and prompting National Grid Corporation of the Philippines to issue a “yellow alert” notice. On that day, available capacity was at 10,326 MW while peak demand reached 9,933 MW.

A yellow alert notice means the grid operator is already tapping into its contingency reserve after its dispatchable reserve was fully spent. Such reserve is equivalent to the biggest operating plant online — the two identical units of the power plant in Sual, Pangasinan each with a capacity of 647 MW each.

Lawrence S. Fernandez, Meralco vice-president and head of utility economics, said it was too early to say how the alert notices would impact on the bills of consumers in the months ahead.

“In the first week of March, we experienced three days affected by yellow alerts. For April we have six days affected by yellow alerts and four days affected by red alerts. So I think the situation this month is different from what we have experienced in March and I think it will have a corresponding impact on the spot market prices,” he said.

The secondary price cap in the spot market was breached, which means that the average price at the spot market was at more than P9 per kilowatt-hour (kWh) for seven days, he said.

Robinson P. Descanzo, head of trading operations at the Independent Electricity Market Operator of the Philippines, Inc., said the average price at the spot market last month was P7.20 per kWh. — Victor V. Saulon