PCCI’s position optimize fossil fuel power plants in Mindanao

Manila Bulletin 
Published: April 18, 2013
Mindanao business leaders have urged the optimization of fossil fuel power plants as this is the fastest way to alleviate the worsening power supply in Mindanao. This was raised by Mindanao leaders of the Philippine Chamber of Commerce and Industry (PCCI) during a recent meeting with the PCCI national leadership recently to discuss possible strategies in response to the continuing rotating brownouts that have been hounding Mindanao for three years now.
A briefing conducted by Romeo Montenegro of the Mindanao Development Authority-Mindanao Power Monitoring Commission (MinDA-MPMC) showed that even if the 15-MW of Iligan Diesel Power Plant (IDPP) is already in operation this month, the resulting available capacity of 1,266 MW will still be 76 MW short of the projected peak demand of 1,299 MW. And except for areas with embedded power generation capacity, daily power outages is bound to persist until 2016 when new coal-fired power plants presently under construction will go on stream.
One of the solutions presented at the meeting by Engr. Robert Mallillin, chairman of the PCCI Power Committee, is to make coal-fired, geothermal, and diesel plants as baseload generators and to use the hydro plants during peak hours.
Based on his estimates, the peak-hour requirement of the whole of Mindanao is at 1,134 MW as against the total generating capacity of 1,884 megawatts available if fully explored and utilized, with diesel contributing 650 MW, hydro at 924.1 MW and coal, geothermal and RE at 308 MW. This, Mallillin said, should leave Mindanao with excess capacity of some 750 MW.
The power shortage has endured, Mallillin said, because of the policy of using hydro as baseload plant and hence first to be dispatched, which led and continue to lead to the under-utilization of diesel-fired power plants.
Amending the dispatch protocol to allow coal, geothermal and diesel to be dispatched first as baseload plants will encourage fossil fuel plants to run at full capacity. In the short-term, it will also raise electricity cost in Mindanao by approximately P1.25 more or less per kilowatt-hour. But this will only be until the coal-fired plants are connected to the grid to replace the costlier diesel plants used as baseload sources of power and assign them later to the cold reserve category.
Meanwhile, Ricky Juliano, PCCI Vice President for Mindanao, clarified that Mindanaoans are not opposed to higher rates from the outset as erroneously reported in many broadsheets since they have known and accepted that the long-term response to the power shortage is the entry of fossil plants. But he stressed that what the Mindanaoans request is to optimize the capacity of the more competitively-priced hydroelectric power plants in Mindanao in order to average down the effect of the higher-cost fossil plants.   source