Boo Chanco (The Philippine Star) -
June 14, 2019 - 12:00am
Hurricane Maria left many Puerto
Ricans without electricity for months. The island’s power grid was badly
damaged and hundreds of people died simply because they couldn’t keep their
insulin refrigerated, or their oxygen machines running.
That led the Puerto Rico Electric
Power Authority (PREPA) to look at microgrids to improve the resilience of the
island to future hurricanes. They plan to use cutting-edge technology and revolutionize
the traditional utility model.
Puerto Rico Governor Ricardo
Rosselló endorsed the decentralized power generation model. “We want
distributed generation. We want microgrids everywhere within the island. This
is an opportunity to leapfrog into the future and create an Energy 2.0.”
Indeed, microgrids are the
future of power distribution. Microgrids using renewable sources of energy like
solar and wind are increasingly able to provide dependable power to communities
at rates comparable to major grids.
For us, microgrids are also
important to achieve 100 percent electrification at affordable rates for
residents in unserved and underserved areas.
Sen. Sherwin Gatchalian, chair of
the Senate Committee on Energy, said he filed Senate Bill 2218 precisely to
encourage the installation of microgrid systems in isolated communities.
Sen. Gatchalian observed that
“total electrification in unserved areas cannot be done by traditional grid
extension alone and that non-traditional means — such as microgrid systems —
are needed. The problem of energy access is also a concern even in“electrified”
areas plagued by constant blackouts, or what we call underserved areas.”
What Sen. Gatchalian wants to do “is
to allow proponents to put up microgrids. These microgrids will be
self-sustaining, meaning they will produce as well as distribute power.”
That goes against the EPIRA
principle of separating generators and distributors. But so what? EPIRA hasn’t
helped bring electricity to isolated areas anyway.
The senator’s bill mandates the
Department of Energy (DOE) to annually release and update the list of unserved
and underserved areas for prospective microgrid service providers (MSPs). The
bill eliminates bureaucratic red tape and delay by streamlining the process for
MSPs with clear timelines and stiff sanctions.
The situation is dire and has
been for so long. The senator pointed out that around 2,779,530 households, or
11.7 percent of the total number of households nationwide, still have no access
to electricity.
He further noted that 83 out of the
171 areas serviced by the National Power Corp. – Small Power Utilities
Group received only four to eight
hours of electricity service in 2018, while 34 areas received only nine to 16
hours of electricity service.
The young entrepreneur Leandro
Leviste noted the service gap that had been left unattended by traditional
electric coops and even private utilities. He had long wanted to go to unserved
and underserved areas and provide them with electricity using solar energy plus
Tesla batteries for nighttime use.
But coops have rejected his
proposals even if the areas Leviste wanted to serve are not being served.
That’s why he sought a congressional franchise that would allow him to set up
solar microgrids.
The Leviste franchise has been approved
by Congress and awaits the signature of President Duterte. But many sectors of
the power industry, big and small, are up in arms as they claim the new
franchise violates existing laws, including EPIRA.
I read the enrolled copy of the bill
as approved by both houses of Congress and I note that it is a non-exclusive
franchise to generate, supply, and distribute electric power using renewable
energy technology in remote and unviable, unserved and underserved areas. Its
coverage has also been limited to specific provinces and municipalities only.
The DOE was also tasked to determine
remote and unviable, unserved or underserved areas. Leviste’s Solar Para sa
Bayan is also required to secure from the Energy Regulation Commission (ERC),
DOE and any other government agency the necessary certificates, permits and
licenses for the construction and operation of its microgrids.
Furthermore, the service rate will
be regulated by and subject to the approval of ERC. Leviste’s Solar Para sa
Bayan is also not entitled to any government subsidy unlike many cooperatives.
The Leviste franchise also states
that no waiver of rights from franchised distribution utilities is necessary to
operate microgrids in remote and unviable, unserved, or underserved areas
determined by DOE.
Some small solar power entrepreneurs
who also want to do what Leviste wants to do are worried that they are now up
against a competitor favored by a franchise. They sought me out and I listened
to their concerns.
I cited Section 13 of the Leviste
franchise regarding competition. Other qualified third parties (QTP) shall be
able to participate in any competitive selection process even without a similar
franchise from Congress.
But they said that is not enough.
Getting accredited as a qualified third party able to compete with Leviste
takes time. They said the process at the DOE to get this accreditation can take
as long as five years. In the meantime, they said, Leviste would enjoy a
monopoly.
If that’s the fear, the solution is
getting DOE and other government agencies to cut the accreditation red tape.
Indeed, I see no reason why other entities willing and able to compete with
Leviste should be deprived of the opportunity to do that. The Leviste franchise
says they can compete with Leviste even without a similar franchise.
Perhaps, the bill of Sen. Gatchalian
can clarify the competitive situation better. But let us keep our focus on the
objective of expanding electric services to every part of the country. Whoever
can get it done fast should be helped.
I can understand why some of the big
guys are up in arms. They feel threatened. They can see a glimmer of the future
which is microgrid and using renewable energy, not coal, not natural gas and
definitely not fuel oil or diesel.
I like the disruption caused by the
young Leviste. Such disruptions are always welcome on the road to progress.
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