DOE eyes tweaks in energy mix policy

By Lenie Lectura - May 1, 2018

https://businessmirror.com.ph/doe-eyes-tweaks-in-energy-mix-policy/

ENERGY Secretary Alfonso G. Cusi said a possible shift in energy mix policy is still under consideration and that extensive studies must be conducted before any changes are introduced.

“It’s just being discussed. No harm there. If it’s possible, then we will look at it. We will study it first, of course,” Cusi said  in an interview when asked if the Department of Energy (DOE) was bent on revising the policy again.

This after DOE Undersecretary Felix William B. Fuentebella announced earlier that the agency was looking at a shift of the energy mix to 50 percent baseload and 50 percent flexible plants.

Baseload plants are power facilities that operate on a 24/7 basis, while flexible plants are those that that are easy to start up and are able to ramp up their generating capacities immediately such as natural gas,  geothermal and hydro.

The current mix now is 70-20-10 mix in favor of baseload, followed by mid-merit then peaking. Mid-merit plants run on long hours but not 24/7. Peaking plants, meanwhile, are easy to start-up and can be used during peak hours.

The current mix under the Duterte administration is already a revision of the Aquino administration’s energy-mix policy which used to be 30 (coal)-30 (natural gas)-30 (renewable energy or RE)-10 (oil-fired plants).

In 2017 data showed that the country’s total installed capacity stood at 22,728 MW. Of this capacity, coal still remained the dominant energy source with a share of 35.4 percent. Coal-fired power plants had a total installed capacity of 8,049 MW, followed by RE at 7,079 MW, or 31.1 percent of the total.

Oil-based energy sources made up 18.3 percent of the dependable capacity at 4,153 MW. Natural gas had a share of 15.2 percent or 3,447 MW as of end-2017.

The proposed change in energy-mix policy was mainly on account of the current trends as far as demand is concerned also based on the technologies that are coming in.

“We are telling the gencos [generating companies] and the industry players that this is what we see from the system point of view. From the system point of view, what we are looking at is the demand behavior plus the coming in of intermittent, variable REs,” said Fuentebella during the recent “Powering the Philippines” conference hosted by General Electric Philippines Inc. and the American Chamber of Commerce of the Philippines.

Fuentebella added that the possible shift to a 50-50 energy mix is brought about by the entry of more RE sources, “We’re anticipating the entry of more RE and to integrate RE into the system. We would need more flexible plants. So we’re looking at the role of natural- gas plants and how these will affect coal and how the mix will be affected.”

He said power producers would be guided accordingly. “We’ll give them the data, that’s what we need. If they do not look at the entire system approach, it will be more costly for them. They need a portfolio approach because we’re looking at the entire system.”

Also, RE policies such as Renewable Portfolio Standards (RPS) and Green Energy Option (GEO) will entice the development of RE in the country.

RPS is a policy mechanism requiring electric-power industry participants such as generators, distribution utilities and suppliers to source or produce a specified fraction of the electricity they generate from eligible RE resources.

GEO, meanwhile, empowers end-users to choose renewable-energy resources for their energy requirements.

The DOE’s National Renewable Energy Program (NREP) seeks to increase the RE-based capacity of the country to an estimated 15,304 MW by 2030, and to at least 20,0000 MW by 2040, almost quadruple its 2010 level.

As of June 30, 2017 the DOE has awarded 831 RE projects under the RE bill, a huge increase from 22 projects since the RE bill’s passing in 2008.

“The increased generation from geothermal, hydro, and solar resources has reduced the country’s dependence on fossil fuels,” GE Philippines CEO Jose Emmanuel de Dios said. “Now, more than ever, the country is open to new ideas and solutions to produce more reliable, sustainable and affordable electricity.”

The forum organized by GE and the chamber is aimed at assessing the future of RE in the country.

“With the looming threat of climate change, sustainability needs to be at the forefront of our concerns when it comes to servicing the country’s power needs,” de Dios added.

GE is a global solutions provider of solar, wind, hydro, biogas, among others. “Through our combined onshore and offshore wind and hydro solutions, we are able to generate power in a more sustainable way. Innovative technologies such as concentrated solar power and photovoltaic solar systems can also make significant power contributions in the more rural areas of the country,” GE Asia Pacific President Wouter van Wersch said.

With solutions for wind, hydro, biogas and solar, van Wersch added GE is “fully equipped” to support the Philippines’s RE targets. “GE is fully committed to be the government’s technology partner as we increase power generation from RE sources in the Philippines, and we will be sure to do our part as the whole country works together toward cleaner and more sustainable energy.”