Meralco all set for 20-day Malampaya shutdown

By Lenie Lectura - January 8, 2017

http://www.businessmirror.com.ph/meralco-all-set-for-20-day-malampaya-shutdown/

THE Manila Electric Co. (Meralco) said it has drawn up its own proposed measures to help mitigate possible price hike and power outage during the 20-day shutdown of the Malampaya gas facility.

In an initial report to the Department of Energy (DOE), the utility firm recommends, among others, to “postpone the reimposition of excise tax on fuels for power generation.” At the same time, Meralco also proposed for “the approval of FiT-All [feed-in-tariff allowance] increase to mitigate the rate impact during the Malampaya shutdown”, which starts on January 28 and will last until February 16.

On its own, Meralco said it would continue to carry out its information campaign on energy efficiency through its  various programs.  More important, it will conduct a forum for Interruptible Load Program participants for the possible ILP implementation in the event that the Luzon grid would be placed on red-alert status during the shutdown.

ILP works by calling on business customers with loads of at least 1 megawatt (MW) to run their own generator sets, if needed, instead of drawing power from the grid.

With the ILP, power supply from the grid that will not be consumed by participating customers will be available for use by other customers within the franchise area. Through this, the aggregate demand for power from the system will be reduced to a more manageable level, helping ensure the availability of supply.

Around 900 MW are enrolled in the program. Of which, 793.07 MW are signed participants and 107.54 MW could be tapped as potential participants that would aid the utility firm in addressing sudden power outage in its franchise area.

Meralco’s ILP had helped avoid power outages in some incidents of yellow and red alerts.

A yellow alert is issued by National Grid Corp. of the Philippines (NGCP) when contingency reserve is less than the capacity of the largest synchronized unit of the grid. In Luzon this is equivalent to 647 MW, or one unit of the Sual power plant.

A red alert, meanwhile, means that there is severe power deficiency. Further, Meralco has instructed First Gas, Santa Rita, and San Lorenzo gas plants to run on alternative or replacement fuel during the shutdown.

However, this is more expensive than natural gas. Natural gas as fuel only costs around P4/kilowatt-hour (kWh), while replacement fuel, such as diesel, costs around P6 to P8/kWh.

The Department of Energy (DOE) made an assurance that it is exploring all possible options and remedies to maximize protection for consumers.

The DOE noted that, during the maintenance activities, some power plants are on scheduled maintenance, as well. Based on initial study, the lowest projected power-supply capacity during the period stood at 8,747 MW on February 18, while highest demand is projected to reach 8,610 MW on February 9.

As such, the DOE also encourages consumers to practice effective “demand-side management.”

“The public should also be proactive in computing the effect of price adjustments to be provided in the simulations given by the agencies concerned to for consumers to practice efficiency measures to avoid price shocks,” Energy Secretary Alfonso G. Cusi said.