Meralco unsure of future energy mix

May 2, 2018 | 12:07 am

http://bworldonline.com/meralco-unsure-of-future-energy-mix/

MANILA ELECTRIC Co. (Meralco) is unsure about the mix of its future energy sourcing, its chairman said, pointing to uncertainties including pricing and government regulation.

“There’s so much uncertainty out there,” Meralco Chairman Manuel V. Pangilinan told reporters.

“Our tentative inclination is to let the market drive our fuel source because obviously even Meralco is looking for the least cost sourcing of power,” he added.

Mr. Pangilinan was reacting to a recent pronouncement from the Department of Energy (DoE) that it was looking at tweaking its energy mix policy to 50% baseload, or mostly coal-fired power plants, and 50% flexible plants such as gas-fired plants.

The DoE previously said that the energy system requires sourcing power from 70% baseload plants, 20% mid-merit plants and 10% peaking plants such as solar farms.

“You have two broad choices. One is a pre-determined mix of energy sources and the question is whether that is a wise thing to do given the uncertainty of prices of crude oil, of gas, of solar etc., and the technological advances that will impact on the price of these fuel sources,” Mr. Pangilinan said.

“The other option is to just let the market drive your optimum sources of fuel. We don’t know, that’s really the dilemma because there’s so much uncertainty out there,” he added.

Mr. Pangilinan said it is a given that coal remains the least costly power source, that is why the group and its units are building several coal-fired power plants.

“I think the cost is very reasonable. It’s very environment-friendly,” he said.

He also said there is “scope” for more solar farms and solar rooftops. “So we’re looking at that very seriously.”

“The question mark is gas. Is it viable if you have to import the gas and therefore have to build the gas terminal? You have to look at it as a pipeline, right? Or is it more viable if we can discover gas in a SC (Service Contract) 72 or in other concession area in the Philippines?” he said.

Mr. Pangilinan also said sourcing power from gas would also depend on the position of the government.

“What is the price of the gas, let’s say indigenous gas, that will be sold to the gas plants here. Again, we don’t know what the requirements are,” he said. — Victor V. Saulon