Gov’t pressed to prepare for recurrence of power deficit

Business World Online

Posted on 09:58 PM, November 01, 2010

DAVAO CITY -- The government and power companies should work on a clear plan to avert, or at least mitigate, the power supply lack Mindanao is expected to experience again during summer next year, the leader of the island’s main business chamber said during a meeting on the issue last week.

Vicente T. Lao, chairman of both the Mindanao Business Council and the Mindanao Electric Power Alliance, said the summer months are expected to again deplete water supply of hydropower plants, on which the entire island relies for over half of its electricity requirements.

The power deficit could hit 300 megawatts (MW) during those dry months -- a situation that could recur at least until 2013 unless enough additional capacity is installed, Mr. Lao said during a public consultation on the power situation last week that was organized by the Mindanao Development Authority.

The prolonged dry spell that lasted throughout the first half had actually caused Mindanao to experience power deficit as big as 400 MW.

Rains since June have somehow softened the power problem. Mindanao yesterday actually had a 318-MW surplus, compared to 1,838 MW in Luzon and a 57-MW deficit in the Visayas, the Web site of the National Grid Corporation of the Philippines (NGCP) showed.

"We must start finding the solution now," Mr. Lao stressed during the meeting.

Eugene H. Bicar, NGCP’s Mindanao Systems Operations head, said in the same meeting that power supply in Mindanao should stabilize if the 120-MW Iligan diesel power plants, which need to be rehabilitated, and the two 100-MW power barges of Aboitiz Power Corp. subsidiary Therma Marine, Inc. were tapped to bridge the expected 300-MW deficiency of the island in the dry months.

Mr. Bicar added there are four smaller power barges now in the Visayas that could be tapped should Mindanao’s power deficiency turn out worse than expected, though the Visayas itself faces its own problem with insufficient electricity capacity.

He said power cooperatives and other distribution utilities should be the ones to tap the Aboitiz-owned power barges whenever the need arises. "The initiative must come from the cooperatives," he said.

In the middle of October, Therma Marine reported it had signed a contract with the Davao del Norte Electric Cooperative. Under the contract, the Aboitiz company will supply the electric cooperative with 10 MW whenever needed. The supply will come from its 100-MW power barge now moored in Maco, Compostela Valley, one of the two barges it bought from the government last year.

Several cooperatives had balked at the charges for using the barges, which run on diesel, hence, are more expensive to operate than hydroelectric plants.

NGCP had earlier suggested that the power barges be run as base load plants that will directly supply the grid and not just individual cooperatives. But Erramon I. Aboitiz, president and chief executive officer of Aboitiz Power Corp., himself had cautioned against using the barges on more permanent basis than originally intended, unless those contracting power from these facilities are prepared to shoulder the higher cost. -- C. Q. Francisco