Nuclear power’s future

business mirror

WEDNESDAY, 27 APRIL 2011 20:50 THE MIAMI HERALD EDITORIAL

Although experts still do not understand clearly what went wrong, the disaster at the Fukushima Dai-ichi nuclear installation has sparked understandable fears about nuclear safety and a debate that will have significant consequences for the future of our energy needs.

Nuclear-industry officials have been at pains to proclaim that the 104 US nuclear-power plants are safe. One compelling piece of evidence they cite is that, globally, nuclear plants have close to 15,000 reactor-years of experience, with known severe accidents limited to five commercial power reactors—three of them in Fukushima and only one, at Three-Mile Island, in the United States.

As impressive as that seems, skeptics point out that one nuclear accident is one too many. Indeed, the event at Three-Mile Island was so traumatic that it froze the industry in its tracks for three decades, going on four.

Now, as a result of Fukushima, the Tennessee Valley Authority (TVA) says it is considering improvements for the six nuclear reactors it operates because of “potential vulnerabilities from a chain of events.” Meanwhile, power producer NRG, which was planning the largest nuclear project in the country, announced it was giving up plans for two giant reactors in Texas and writing off its $331-million investment.

The future of the nuclear-power industry is of crucial importance to South Florida because energy provider FPL says it needs to add two reactors at Turkey Point in South Miami-Dade to cover projected electrical-power requirements for a growing population.

Last week FPL executives offered assurances to a delegation of four local members of Congress that it was prepared for any conceivable eventuality and that comparisons with Fukushima were off the mark. Turkey Point has a different design, was built by a different company (Westinghouse, not GE), and is powered by different fuel (uranium, not plutonium).

Unlike the Japanese plant, Turkey Point is not located in an earthquake zone, and getting hit by a tsunami is far-fetched, if not impossible, given the barrier formed by the Bahamas chain. The plant has already survived a direct hit from a Category 5 hurricane (Andrew, 1992) and the accompanying storm surge. And FPL plans to build a “dry” storage facility for spent-fuel rods—an improvement TVA is just now contemplating—to reduce the risk of a leak.

As long as there are an infinite number of things that can go wrong and only a finite number of preventative measures, nuclear power will never be 100-percent safe. But given existing technology, the increasing needs for power generation and the desire for clean sources of energy, nuclear power cannot be ruled out as a viable option. The industry’s safety record and its obvious self-interest in avoiding accidents speak for themselves.

But before going forward, two actions are critical.

·         First, FPL must undertake a campaign to inform the public about nuclear power and its safety measures. The public is right to be worried, and without its support, nuclear power has no future.

·         Second, as Mayor Philip Stoddard of South Miami wrote in a letter to The Miami Herald published on Sunday, “Miami-Dade County is grossly unprepared to deal with a significant radiation release.”

Can’t happen here? Probably right, but who wants to take a chance? South Florida is so congested, and avenues of evacuation so limited, that the public deserves reassurance on this front, as well. FPL, together with county officials and emergency planners, has a duty to bring the public up to date about plans for the possibility of a nuclear accident.

This week marks the 25th anniversary of the nuclear disaster at Chernobyl, the worst ever. The area near the Ukrainian site is still a no-man’s land, and the final accounting of damage remains unknown. It’s a good time to redouble efforts to ensure that there are no more Chernobyls—and to be prepared if there are.

Ayala subsidiary allowed by ERC to sell electricity

business mirror

WEDNESDAY, 27 APRIL 2011 19:38 PAUL ANTHONY A. ISLA / REPORTER

AYALA-LED Philippine Integrated Energy Solutions Inc. (PIESI) has been granted by the Energy Regulatory Commission (ERC) a retail electricity suppliers license that allows the company to sell, broker, market or aggregate electricity to end-users.

“ERC welcomes PIESI as the [country’s] 12th RES. More players in the electric power industry would lead to a healthy business competition in the open access and retail competition environment,” ERC chairperson Zenaida Ducut said.

Upon assessment of PIESI documents, ERC said the company met the vital requirements on its ability to operate and manage an electric supply business and comply with ERC rules and regulations, as well as its ability to set up and operate an automated information exchange system (business-to-business communications and transactions).

PIESI has also complied with other requirements such as its ability to enter into any necessary access or interconnection arrangements or other required contracts with one or more distribution utilities and the transmission and market operator and adequate staff and employee training appropriate for its retail supply operations.  

PIESI was organized to function mainly as a retail electricity supply unit which targets to supply commercial and industrial end-users within the Ayala Corp. group of companies in the open access and retail competition regime. Open access allows large power users to choose their own suppliers.

PIESI plans to supply the energy requirements of customers with an initial 50 megawatts.  

“This market share will increase as PIESI acquires additional customers to serve and enter into new contracts with generators. PIESI will source its power from privatized National Power Corp. assets, bilateral contracts with independent power producer administrators, new generation companies, and through the wholesale electricity spot market,” ERC said.

PIESI is a newly formed private corporation that was registered with the Securities and Exchange Commission in September last year.  It is owned by Ayala Land Inc. a wholly owned subsidiary of Ayala Corp.  It is managed by Ayala Property Management Corp.

The Ayala Group has entered the power sector recently with the incorporation of a wholly owned subsidiary Michigan Power Inc. which plans to invest in hydroelectric and wind projects. 

Consunji Holdings reports nearly P8 B in profits

By Doris Dumlao
Philippine Daily Inquirer
First Posted 15:41:00 04/27/2011

MANILA, Philippines—The Consunji-led DMCI Holdings Inc. grew its consolidated net profit last year by 67 percent to P7.9 billion from the previous year on strong contribution from its construction, mining, real estate, water and power businesses.
Based on audited financial report for 2010, DMCI said the growth in net profit after minority interest was boosted by the full-year operations of the new power business. For 2010, 12 months of earnings from the Calaca power plant were booked compared to only one month of earnings contribution in 2009.
Mining, through its interest in Semirara Mining, was the biggest contributor to DMCI's 2010 bottomline with a share of P2 billion or 26 percent. Its interest in water concessionaire Maynilad Water Services Inc. as a partner of the Metro Pacific group yielded P1.88 billion or 24 percent of last year's profit.
Construction and real estate each contributed about 16 percent or over P1.2 billion while the new power business provided P847 million or 11 percent of total profit last year.

Aboitiz remains optimistic coal plant to push through

Sunstar Davao

AFTER getting the endorsement from three out of the four local government units most directly involved in its proposed 300-megawatt (MW) circulating fluidized-bed coal-fired power plant, officials of Aboitiz Power Corp. are optimistic the project will push through.

Bobby Orig, AboitizPower first vice president for Mindanao Affairs, said the company was honored to have received the endorsements from the municipal council of Sta. Cruz and the resolution interposing no objection from the barangay councils of Inawayan and Binugao.

"We are glad we were able to convince the officials of Sta. Cruz and Barangays Inawayan and Binugao about clean coal technology and how modern technology can assure a clean, safe and reliable power plant operation," Orig said.

"We look forward to answering the questions and concerns of the Davao City Council as we continue to emphasize that this project will do more good than harm to the community and to Mindanao," he added.

The P25-billion project will be a built on a 52-hectare property straddling barangays Binugao and Inawayan, highlighting the importance of the support of the host communities.

The municipal council of Sta. Cruz in Davao del Sur unanimously passed its endorsement of the project last April 1. Barangay Binugao in Davao City passed its resolution interposing no objection last April 15 with only one objection of the eight members of the barangay council.

Last April 24, Barangay Inawayan in Sta. Cruz gave a unanimous nod days after conducting a public hearing which also resulted in an overwhelming approval of the community for the project.

The Davao City Council, in the meantime, held its last joint-committee level hearing last April 8. The committees reviewing the project are set to schedule a third hearing.

Orig said AboitizPower is ready to answer all questions regarding the project and the technology the company will be bringing to Davao.

"We always see public hearings as an opportunity for us to explain our project and to show that our technology is safe and clean. We are glad that so far we were able to convince public officials in Sta. Cruz, in Inawayan and in Binugao," Orig said. "But we would like to emphasize that the power shortage is upon us and we have to act quickly to be able to prevent a wider destructive effect of a massive power shortage."

Orig said AboitizPower will continue to work closely with the host communities who already approved the project.

"We will continue to coordinate and consult with the barangay officials and leaders of the community to find areas of cooperation and to ensure that the project will bring the utmost benefits to our communities," Orig said.

The Mindanao power situation is expected to be precarious once more as 2011 is in the summer months. The dry summer usually brings water level Lake Lanao down, affecting the generating capacity of the Agus-Pulangi hydropower complex - the lifeblood of Mindanao's power supply.

"We need to get the balanced mix of power from different sources so that even in the summer or during El Nino, Mindanao will have reliable power," Orig said.

Government estimates that the Mindanao power shortage is set to worsen and that by 2014, the shortage will be around 480 MW -- enough to cause rotating brownouts of up to six hours per day during the dry season and up to three hours per day during the rainy season for all power users in Mindanao.

"The Aboitiz group has been in Davao for more than 50 years already. The people of Davao know of Aboitiz and we have a track record of responsibility and integrity. We will not do something that will destroy the community where we live in," Orig said.

Published in the Sun.Star Davao newspaper on April 27, 2011.

Ceneco denies contract with Manta

Sunstar Bacolod

By Teresa Ellera-Dulla

Wednesday, April 27, 2011

THE Central Negros Electric Cooperative (Ceneco) disputes the claim of Manta Energy Inc. that it has a power supply contract with the electric company.

Ceneco general manager Sulpicio Lagarde Jr. said Ceneco was compelled to issue a clarification because of an apparently all out and expensive media campaign of Manta to force Ceneco to accept a 22 megawatts (MW) power supply contract that Manta officials claimed Ceneco signed on 17 March 2009 with Manta under its previous name IN2Power.

Lagarde disclosed that the claimed contract was never evaluated and deliberated upon by the Ceneco Board of Directors, although one document bore the signature of then Ceneco president Vicente Sabornay.

Sabornay claimed that he signed the document because he thought the contract was deliberated upon as scheduled on 17 March 2009. This was manifested during the Ceneco board meeting in Bacolod City on October 26, 2010.

The Kepco Salcon officials were duly advised by the Ceneco Board of the rejection of the contract under Board Resolution No. 9221.

Lagarde said the Ceneco Board even passed a resolution on November 9, 2010 confirming the decision not to enter into the 22 MW additional contract with IN2Power, which turned out to be just a broker and would buy the power from the same Kepco plant in Cebu with which Ceneco already has a 40 MW power supply contract.

“It must be understood by our member consumers and the local government officials that Ceneco needs to diversify its power supply to assure reliability,” Lagarde stressed.

“Negros is an island,” he added. “Buying power mainly from Cebu and Leyte has been causing brownouts whenever there is a problem in high voltage between Cebu and Negros. For reliability we need to buy power from Panay Island and from Negros Island,” he explained.

He added that Ceneco has no objection in sourcing power from Negros-based Green Core geothermal or other Negros island based power generators. However, Ceneco had a pricing formula dispute on its own proposed contract with Green Core, Lagarde pointed out.

“We nonetheless encouraged our associates in the Negros Power Aggregation Group or NPSAG to buy from Green Core. Negros-produced power supplied to the Negros island grid will contribute to reliability of Negros as a whole,” he said.

Lagarde also lamented that some Manta officials are trying to manipulate Ceneco into accepting a rejected contract by filing an application with the ERC.

“We consider the act to be in bad faith because Ceneco has no contract with IN2Power or its new name Manta,” Lagarde said.

Published in the Sun.Star Bacolod newspaper on April 27, 2011.

ERC approves power sales agreement

Sunstar Bacolod

THE Energy Regulatory Commission (ERC) has approved the power sales agreement (PSA) entered into between the VMC Rural Electric Services Cooperative Inc. (VRESCO) and First Farmers Holding Corporation (FFHC) for a three megawatt supply of electricity on an ‘as available basis’ arrangement.

"After a thorough evaluation...the Commission finds that the PSA...between VRESCO and FFHC will redound to the benefit of VRESCO's member-consumers in terms of continuous, reliable, efficient and affordable power supply as mandated by the Electric Power Industry Reform Act (Epira)," the ERC ruled in its 29-page decision docketed under case #2010-006 RC.

It also noted that the PSA conforms to the national government's program to promote the use of renewable energy to address various environmental concerns such as garbage disposals, greenhouse gas emissions and global warming.

VRESCO franchise area covers the cities of Cadiz, San Carlos, Sagay, Escalante and Victorias as well as the towns of Calatrava, E.B. Magalona, Manapla and Toboso.

With the scheduled privatization of the National Power Corporation's generating assets in the Visayas Grid and the lapse of the NPC-VRESCO power sales contract (PSC) last December 25, 2010, the distribution utility started looking for independent power producers (IPPs) that can supply its annual energy requirement of 145,250,754kilowatt-hour.

VRESCO signed a PSC with Kepco SPC Power Corporation for a 61,320,000kWh base load requirement for 10 years starting Feb. 28, 2011. It also entered into another PSA with the San Carlos BioEnergy Inc. (SCBI) for a contract quantity of 21,024,000kWh for 30 years pending ERC approval.

"VRESCO further prioritized negotiations with IPPs that are within its franchise area...one of these is FFHC that also operates a co-generation, bagasse fueled system (which is) a renewable energy system like SCBI," the ERC said.

The final PSA dated September 1, 2009 was signed by VRESCO president Armando Federico Valmayor and general manager Eduardo Parrocho as well as FFHC president Jose Ma. Villanueva and general manager Ricardo Leon Echaus as per authority granted by their respective board of directors.

The agreement was filed for ERC approval on January 14, 2010. In March that year, the Commission issued an order provisionally authorizing VRESCO and FFHC to implement the PSA with regard to the 3MW non-firm (as available basis) power supply.

The PSA is for 10 years starting Sept. 1, 2009. During milling operations, the daily contract quantity shall be on 'as available basis' with the best effort on FFHC's part to maintain the minimum quantity of 3.0 - 3.5 MW.

“Purchased power rate from January 1, 2011 to August 31, 2019 shall be P4.1920/kWh while provisional rate or the price per kilowatt-hour of electricity delivered by FFHC from Sept. 1, 2009 to December 31, 2010 shall be one percent lower than the weighted average discounted generation charges before the application of the prompt payment discount paid by VRESCO to the NPC,” ERC noted in its perusal of the PSA salient features.

In finally approving the VRESCO-FFHC power sales agreement, the Commission however ruled that as per its computation of the various cost components, the tariff rate shall be P2.8978/kWh as against FFHC's P4.1920/kWh or a difference of P1.2942/kWh and directed the two parties to submit a scheme for the refund of the difference between the provisionally and final approved rate for its sanction.

“Should the parties rescind the contract, the final rate…shall be the price that VRESCO should pay FFHC for the energy purchased,” it added. (CGC)

Published in the Sun.Star Bacolod newspaper on April 27, 2011.

DENR won’t impose mining moratorium

By Kristine L. Alave, Vincent Cabreza
Philippine Daily Inquirer, Inquirer Northern Luzon
First Posted 04:19:00 04/27/2011

MANILA, Philippines—The director of the Mines and Geosciences Bureau (MGB), an agency under the Department of Environment and Natural Resources (DENR), Tuesday dismissed the call of a Catholic bishop to declare a moratorium on mining in the wake of the Good Friday landslide in Pantukan town, Compostela Valley province.
MGB director Leo Jasareno said stopping all mining activities nationwide was a disproportionate reaction to the landslide that killed at least eight persons in the gold mining community of Panganason in Barangay Kingking. He said the problem was illegal small-scale mining, and not the mining industry in itself.
Jasareno said small-scale mining was vital to the mining industry, being responsible for about 70 percent of the gold mined in the country. (The quarrying of gravel and sand is also done by small-scale miners.)
He said there were 2,000-3,000 companies with small-scale mining permits nationwide, providing employment in remote areas.
Panganason residents began leaving their homes Tuesday in compliance with a government-ordered evacuation of the area that was found at high risk of more landslides.
On Monday, Manila Auxiliary Bishop Broderick Pabillo called for a moratorium on all mining operations until an efficient monitoring and control system had been put in place.
Pabillo also said the government should address “loopholes” in the Philippine Mining Act of 1995 before allowing both small miners and giant firms to exploit mineral resources.
Repeal Marcos-era decree
Illegal miners, many of whom are residents of mountain communities, number about 300,000, Jasareno said. In Pantukan alone, about 3,000 residents are engaged in mining.
Small-scale mining is a source of income for local governments, which have jurisdiction over these operations, Jasareno said.
He said the DENR recognized that the power to issue small-scale mining permits had been “abused.” Thus, he said, the MGB had proposed that President Benigno Aquino III repeal a Marcos-era decree empowering provincial governors to unilaterally approve such permits.
“We want to stop the implementation of Presidential Decree No. 1899 because it is the cause of the problem,” he said.
The decree, called An Act Establishing Small-Scale Mining as a New Dimension in Mineral Development, was issued in 1984. It is prone to abuse as local governments do not oversee the regulations as well as the safety of the permit holders, according to Jasareno.
The law that should be followed on small-scale mining is Republic Act No. 7076 (An Act Creating a People’s Small-Scale Mining Program and for Other Purposes), which was enacted in 1991, he said.
RA 7076 mandates stringent rules for mining companies and ensures that the government gets a share of the income from the operations.
Jasareno said Environment Secretary Ramon Paje had submitted the proposal to repeal PD 1899 to the Office of the President.
In La Trinidad town, the Benguet Federation of Small-Scale Miners (BFSSM) said the government should start enforcing a 2004 policy recognizing small-scale mining as a formal sector by including pocket miners or their groups as stakeholders once the state reopens mining areas for auction.
Federation president Lomino Kaniteng said these areas had been weeded of underdeveloped or nonperforming properties that had been leased to big mining firms.
Paje began a review process of all mine leases last year on the directive of Mr. Aquino.
Kaniteng said small-scale miners held high hopes in 2004 when then President Gloria Macapagal-Arroyo issued Executive Order No. 270, the national policy agenda for revitalizing the mining industry.
“Under EO 270, one of the guiding principles is the acceptance of small-scale mining as a formal sector in the mine industry, and up to now a policy has never been drafted to that effect,” he said.
Section 2 of EO 270 states: “Small-scale mining shall be promoted as a formal sector of the minerals industry and as part of the development initiative for both downstream and upstream industries.”
The order required the DENR to develop a mineral action plan, but it was silent on small-scale mining, Kaniteng said.
BFSSM records show that small-scale mining is estimated to be worth P250 billion.
In Benguet province, three tons of gold produced by small-scale mining groups were sold to the Bangko Sentral ng Pilipinas (BSP) between 2002 and 2007, according to BSP records.
But despite the sector’s potentials and RA 7076, the industry “never got respect,” Kaniteng said.
He said pocket miners operated without strict supervision in many parts of the country because the law was not enforced properly.
In many provinces, local governments have not set up the required provincial mining regulatory boards (PMRBs) that would issue licenses to operate small-scale mines.
“Where is it legal for mayors to issue mining permits? That should not have happened,” Kaniteng said, referring to reports that the gold rush sites in Compostela Valley were provided legal cover by municipal permits.
Most towns also have no expertise to assess whether a proposed mine site is safe, said Kaniteng, a civil engineer.
“RA 7076 takes charge of artisanal operations, meaning shallow surface and shallow underground [tunnels], but many of the towns now addressing mine ventures in their areas do not know how deep the tunnels should go or what kind of support these tunnels really need,” he said.
Benguet as model
Kaniteng said many mining towns had made Benguet a model for small-scale mining practices because the province hosted the first American-led mining operations in the early 1900s.
Benguet, Mountain Province, Kalinga and parts of Abra also share a centuries-old gold panning tradition, he said.
As well, Benguet has a functioning PMRB that spent years earning the trust of pocket miners, he said.
Kaniteng said that last year, various pocket-mining groups allowed the PMRB to conduct a survey that would list for the first time who and how many small-scale miners were operating in Benguet.
Like many other mine sites, Benguet is now dealing with migrant pocket miners from Mountain Province and Ifugao, “so there is a great deal of diplomacy and politics involved in threshing out problems,” Kaniteng said.

Only 1 gov’t geologist in Region XI

By Joan Mae Soco-Bantayan | Wednesday| April 27, 2011

DAVAO CITY (MindaNews/26 April) – The government has only one geologist assigned in Region XI, an area prone to natural disasters, Director Leo Jasareno of the Mines and Geosciences Bureau (MGB) said in a press conference here Monday.

Jasareno said that in the last 3 years, only 86 of the country’s 160 geologists were left. He said the mean reason for the exodus is the low pay the government offers in contrast to the huge salary they could earn if they work with mining corporations.

“The government only pays our geologists Php30,000 but the corporate firms offer three to five times more than what we can afford,” he said.

“Right now, we cope with the lack of human resource, especially in this field by outsourcing. Kaya lang, wala rin kaming mahanap (but we can’t find any),” he added.

MGB’s Beverly M. Brebante is the lone government geologist in Region XI.

“Kanyang utos, siya rin ang gumagawa (She implements her own orders),” Jasareno said of Brebante’s as the region’s only expert in the geology profession.

Brebante used to work in Region X but later asked to be transferred to Region XI. She obtained her license in August 2005 after hurdling the Geologist Board Examination where 39 out of 50 examinees passed.

MindaNews tried to reach Brebante but was told by MGB XI that she had already left for Compostela Valley.

In a phone interview, Wilfredo Moncano, officer in charge of MGB XI said that the region needs seven geologists and a division chief.

Asked what action should be taken to encourage the geologists to work with the government, Moncano said they have been pushing for salary rationalization under Executive Order 366.

He said EO 366 would have increased the pay of their employees. “But as of now, the increase is still pending at the Department of Budget and Management.”

He added that another alternative is to send scholars to state universities that offer geology courses.

He said MGB XI expects to absorb the sole scholar enrolled in geology who will graduate in March 2012.

“We also have five mining engineering students who are incoming seniors of the 5-year course. We are really looking forward for them to join us,” he said. (Joan Mae Soco-Bantayan/MindaNews)