DOE needs a clear policy on energy mix - Decision on Batangas gas pipeline go-ahead

Published November 28, 2016, 10:01 PM By Madelaine B. Miraflor

http://business.mb.com.ph/2016/11/28/doe-needs-a-clear-policy-on-energy-mix/

The plan of the Department of Energy (DOE) to put under the private-public partnership (PPP) scheme the proposed Batangas-Manila (BatMan-1) pipeline project is still on the table but the new PPP Center Executive Director said a clear energy-mix policy is needed for such a critical project to push through.

To be implemented by Philippine National Oil Company (PNOC), BatMan1 will transport natural gas to targeted markets located in the high-growth areas of Batangas, Laguna, Cavite, and Metro Manila through transmission pipelines from Batangas.

But PPP Center Executive Director Ferdinand Pecson said the DOE now intends to expand the scope of the BatMan-1 pipeline project, which will deliver natural gas from the Malampaya rig to power stations.

“What the DOE has to decide about, because we sat with them and we are following up with their decision, is whether they would continue to pursue this and identify the scope that they now want to have for this project,” Pecson told reporters at the Global Investment Forum held in Taguig City.

“Because before, [the project involves] just the pipeline… now they said they now want to go further upstream and include the facility or the plant that will take in the raw material and process this into gas that will then be distributed,” he added.

It was in 2010 when the DOE revealed its plan to put the BatMan-1 project under PPP scheme.

“Just like in the airport-related PPP projects, it will need fuel mix policy — coal, natural gas, renewable energy — because along with that policy is really creating the right kinds of incentives and also other measures for that policy to actually happen.  There will be sort of an intervention in terms of incentives that will be provided,” Pecson further said.

Estimated to cost R14.7 billion, the 121-kilometer project is one of the critical natural gas infrastructure projects ever proposed by the government.

Until now, the government is yet to draft a clearer fuel mix policy.

An earlier report at Manila Bulletin showed that many of the generation plants coming on-line between this year to 2019 and onwards are mostly from coal plants, which would lower the capacity share of renewables and gas in the entire mix.

While presenting the Philippine Energy Plan (PEP), DOE director Jesus Tamang has emphasized that a fuel mix policy could prevent increasing share of coal in total power generation.