Solution must be long term

A former Department of Energy (DoE) chief has offered a workable solution to the perennial problem of lack of power supply during peak periods, which is that the government return to the operation of power plants but only of those that are considered for peaking.

Power plants are classified into baseload, mid-merit and peaking where baseload and mid-merit are relied on to provide the usual demand while peaking kicks in when electricity use is at its highest.

Former DoE head Jericho Petilla said the government should have a presence in the power generation sector at least to provide backup electricity.

So-called ancillary services or reserve power has been a tricky business since system operator National Grid Corporation of the Philippines said that obtaining contracts for these will jack up monthly bills.

Petilla said the grid has backup electricity but the question is if this is enough.

Baseload plants or those that generate the basic electricity supply include hydroelectric generators, which during summer become unreliable because of the lack of water. Coal plants also have to work overtime which makes them susceptible to breakdowns.

Solar power helps but only in the daytime since the country still lacks battery storage facilities.

Without efficient management, the problem may last forever, according to Petilla.

The government’s role is crucial in managing the daily power equation since putting up more plants than needed may trigger overbilling that the public will have to pay for.

Petilla, however, warned that nobody will build a power plant if there are no takers, thus “what will happen to the excess capacity when the demand normalizes?” Ultimately somebody will have to pay for it because it has been built.

Part of DoE’s job is to predict when each of the power plants may likely break down and when it can provide maximum output. Exact numbers are required since if the figures fall short, you can expect brownouts.

Building a power plant is costly since the rule of thumb is that $2 million is needed to generate 1-megawatt of electricity so a 500-megawatt facility will cost around $1 billion.

The Electric Power Industry Reform Act bars state-owned National Power Corp. from building a power plant but Petilla said the law does not prohibit other government bodies from engaging in power generation.

For instance, he said, the Philippine National Oil Co. could put up generating plants if it wants to. The government can come in as a provider of reserve power during peak demand periods.

Ideally, the government can set up so-called modular diesel plants that can start up within one hour to supply power, particularly during a shortfall period.

The government, however, will have to continue balancing the capacity and demand.

The recent red and yellow alerts in the Luzon grid prove that we do not have enough capacity to ensure uninterrupted supply.

The country may be spared at the moment from widespread interruptions but there is no guarantee of stability in the future.

The highest demand is recorded during the summer when the temperature peaks. That is a given but industry preparations are always lacking each year.

Luzon, which used to be spared from power interruptions, is facing unprecedented supply challenges due to unscheduled plant outages and the extreme heat brought about by El Niño.

Peak demand on the main island was earlier projected to hit 13,917 megawatts but already this was breached in the past months after actual demand exceeded 14,000 MW at a time when so many generation capacities were either unavailable or derated.

A holistic approach that may require the recalibration of the EPIRA is needed that, in turn, needs Congress and other branches of government to step up and deliver.