Power struggle: Solar, wind challenge coal as more affordable energy source

By Jonathan L. Mayuga - April 17, 2017

http://www.businessmirror.com.ph/power-struggle-solar-wind-challenge-coal-as-more-affordable-energy-source-2/

Part Two

LIKE gold and other minerals, the Philippines is rich in coal.

According to the Department of Energy (DOE), the country’s in situ coal reserves as of December 2015 amount to 470 million metric tons (MT), or 19.7 percent, of the country’s total coal-resource potential of 2.39 billion MT.

The country’s energy-source mix, however, is slowly shifting to renewable energy (RE), with more and more companies  venturing into RE-related development projects.According to Greenpeace Philippines climate and energy campaigner Reuben Muni, what is needed is the required boost from the DOE, which should be facilitated by the ongoing energy-mix policy review, which specifically aims to veer the Philippines away from coal addiction.

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The coal industry is booming in the Philippines because of increased interest brought about by the huge demand for cheap, reliable energy source, according to Muni.

Underexplored areas

THE DOE reported that there are 30 coal-operating contracts in the development and production phase; 48 coal-operating contracts in the exploration phase; and 83 small-scale coal-mining operators as of July 2016.

The Coal and Nuclear Minerals Division (CNMD) is also continuously scouting for underexplored coal areas.

In May 2014 15 prospective coal areas in Mindanao and five companies submitted nine applications for seven of these areas. These areas are in the provinces of Agusan del Norte, Agusan del Sur, Surigao del Sur, Zamboanga del Norte and Zamboanga Sibugay. On May 18 that year all seven coal- operating contracts were awarded to companies after complying with the technical, legal and financial requirements of the DOE.

“It is but very timely to invest in coal facilities, as the price of oil continues to rise, with coal being still the cheapest option with  abundant supply worldwide,” according to the DOE, as posted in its official web site about coal and its investment opportunities.

The key investment opportunities in the coal sector for private companies include the setting up of coal-preparation plants to upgrade the quality of Philippine coal and
making these acceptable to current coal users. Other investment opportunities involve the expansion of production volumes of higher-rank Philippine coals, which can be used without upgrading and/or blending with high-quality imported coal.

Other investment opportunities include the introduction of clean-coal technologies (i.e., circulating fluidized bed combustion) to ensure utilization of Philippine coals with minimal adverse effects on the environment, and the putting up of mine-mouth power plants designed to utilize the abundant low-rank coals that have no alternative markets.

‘Clean coal’

REGARDED as the dirtiest of all fossil-fuel source of energy, advocates for coal as fuel are losing the climate and energy discourse. Hence, so-called clean coal and clean-coal technology have been introduced to attract more investment.

Higher-rank coals are now an option for prospective investors. Purportedly, it can be used by current users without the need for any coal preparation or blending with imported coals.

According to the DOE, high-rank coals exist. The agency pointed to the coal deposits being mined by the Philippine National Oil Co. (PNOC) with its Taiwanese partner in Malangas in Zamboanga Sibugay, by the Ibalong Resources and Development Corp. in Southern Cebu and by the Rock Energy International Corp. on Batan Island.

The DOE said the coal deposits in Catanduanes Island have been contracted out to Monte Oro Resources and Energy Inc. for coal exploration, while the coal areas in General Nakar, Quezon, are waiting to be contracted. According to the DOE, “there are also two other coal fields of good quality”: the Integrated Little Baguio (ILB) and Lalat mines. The ILB mine is covered by the PNOC’s coal-operating contract. On the other hand, the Lalat area will be developed through a joint venture between PNOC and Filsystems Inc., the DOE said.

According to the DOE, it is the downstream coal sector, particularly the utilization of coal for power generation, and cement- manufacturing companies that can introduce clean-coal technologies in existing and future power and cement plants to minimize adverse effects of coal on the environment and still be competitive, are definitely welcome.

No such thing

There is also what the DOE describes as clean-coal technology.

Coal washing or preparation—a wet method of cleaning low-rank coal by separating coal from the wastes using specific gravity differences—reduces ash and sulfur contents of coal and increases its heating value.

There are other technologies, such as circulating fluidized bed  combustion technology, flue gas desulfurizer and setting up mine-mouth power plants.

However, Muni said there is no such thing as clean coal or clean-coal technology because “coal is coal”.

Early in February last year, Greenpeace warned that deaths due to stroke, heart and other cardiovascular diseases, and respiratory illnesses because of air pollution may go up from the current 960 annual premature deaths to 2,410 deaths per year, with the construction and operation of more coal-fired power plants in the country.

A report, titled “Coal: A Public Health Crisis”, was released by Greenpeace along with environmental and public-health interest groups to warn the government and the public about the health impacts of existing coal-fired power plants and the plan to construct more in the future.

The report that cited diseases and deaths attributed to coal use in the Philippines said coal-fired power plants expose people to toxic pollution, resulting in hundreds of premature deaths every year.

Sunrise industry

SOLAR, wind and, possibly, ocean current are ready to give coal its biggest challenge as energy source.

In fact, RE may soon become the next sunrise industry in the Philippines and Southeast Asia.

Setting aside the impact of climate change or the climate-change scenario, looking from a purely economic point of view, Muni said there will come a time that the Philippines will be forced to shift to renewables.

“Coal resources are already depleted,” he said. The technology itself,” Muni added. “The price of RE technology is dropping.”

Unlike RE like solar, wind and ocean current, the potential energy supply that can be generated is limitless, he added.

The No. 1 country in terms of wind- and solar-power generation today is China, according to Muni, citing again the “Boom and Bust 2017—Tracking the Global Coal Plant Pipeline” report.

This year 47 new coal plants that were scheduled for construction in China were canceled. When you talk about China, the average power-generating capacity of coal-fired power plants is around 500 megawatts (MW), according to Muni.  That means a 48-percent drop in preconstruction activities and a 62-percent diminution in construction stats, he added.

“From a global point of view, the trend is clear,” Muni said. “There are regions in the world that the shift is apparent, like Southeast Asia. Indonesia, Vietnam and the Philippines are among them. [But] China is leading the way.”

According to the Greenpeace official, it was the Europeans that earlier led the march to RE, with Germany as top dog.

“[But] Asia is now making the shift,” Muni said. “China and India are leading the shift from fossil fuel to renewables.”