Mindanao's power calvary

When President Benigno Aquino III declared yesterday that the people of Mindanao, which has been suffering from rotating brownouts for years now, will have to pay more for their power consumption, he is merely stating the inevitable and obvious. It is also and admission of failure of this Administration to address the lingering power problem in Mindanao as well as in the Visayas.

We have already said almost verbatim the same thing years back in a post. Reading my post again gives me goose pimples when I realized much of what I said then have come to pass.

“The power rates will go up in Mindanao because the choice is a higher power rate or no power. And many of those we’ve spoken to understood the necessity for higher rates, and they’re amenable to this, instead of no power at all,” he said during an ambush interview at a Pasay City bus terminal on Tuesday. What a message to Filipinos leaving to the provinces to observe the solemnity of the Lenten season.

No, I disagree that those whom he talked to are amenable to this. Are you?

Like good Christians we are more like submitting ourselves to bad governance and inadequate planning. We are carrying this cross of bad governance to our Calvary.

Pnoy was saying this in the context of DOE's plans to buy "modular" diesel-powered plants as a stop-gap measure until 2015 when the coal-fired plants start coming in. This was the plan presented by politician-turned-DOE secretary to Pnoy.

The idea is, the plants can be set up in as little as six months to at most one year. He also claimed, or rather being advised, that "[b]y 2015, we expect the problem to largely go away—by that time, we’ll have good surplus. That’s the time the (coal)  power plants go on line". Considering the procurement and setting up process alone, six months is a pipe dream. What about the permits and other bureaucratic requirements?

It seems that the president is ill-advised. The "solution" forwarded by Petilla is uncannily similar to what then DOE Secretary Rene Almendras proposed early 2012: sale of diesel-fueled power barges owned by the government. If that was a success, we won't be in dire situation today. Now how different is the current DOE secretary's proposal?

The numbers don't even add up. We even put a conservative 3% annual energy growth then (if we are to maintain the  economic growth at about 5.5 - 6, the energy demand would be nearer to 5 than 3%), and the power plants under advanced construction wouldn't put a dent on the demand.

The news report also quoted that at present, Mindanao has a power shortfall of 294 megawatts. The demand is at 1,157 MW while the actual supply is only 863 MW. But how much of this in dependable supply? The 300 MW to come online in 2015 quoted by the President is only enough to cover this shortfall at present. (For more of the coal plants coming on line, see this.)

How would we power the power-hungry new mines? New mines and sprouting subdivisions and malls if we are to believe in a peace dividend upon the cessation of political hostilities in Mindanao. We are not even factoring in the continuing siltation at Agus  or the aging diesel plants that are still in operation.

For a healthy economy to keep chugging along, the rule of thumb is, there should be a reserve supply of at least 30% more. Advanced and some developing countries have reserves of 40% or  more.

Just this afternoon, we have gained the coveted investment grade rating from Fitch. What it means is that the Philippines is safe enough to invest in. Imagine if a portion of the expected foreign  investment is poured into Mindanao.

At the very least, Aquino should refrain from recycling politicians into his Cabinet, especially like the sensitive and critical Department of Energy. How many DOE secretaries did we have in the last 5 years? Every time a new face sits at the DOE throne, all the pending and ongoing projects are delayed, scratched or "reviewed". We have not had any technocrat at the helm of DOE since the late Geronimo Velasco of Marcos' time, except probably Mr. Vince Perez.

In the meantime we can only shed tears and watch the people of Mindanao carrying the power shortage cross to Calvary. I don't want to see them nailed there.
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Note added on April 8: Napocor has warned that Mindanao power situation will get worse next month (May) due to decreasing water levels at Lake Lanao. The deficit is now 121 MW.

Obama chooses Nobel laureate physicist as energy secretary

US President-elect Barack Obama announced on December 15 his choice, the Nobel Prize winning physicist Steven Chu as his energy secretary to head the Energy Department.

Chu, 60, who is currently the director of the Lawrence Berkeley National Laboratory in California, would be the first Asian-American to lead the department.

His 1985 work on laser trapping of atoms at ultra-low temperatures of a millionth degree above absolute zero, led to his being a co-winner of the Nobel Prize in physics in 1997. That seminal work, together with other techniques like magnetic cooling, laid the foundation for achieving one of the holy grails of statistical physics in 1995; the so-called Bose-Einstein condensation which demonstrates a new form of matter.

The phenomenon was predicted by none other than the great physicist Albert Einstein and then-young Indian physicist S. N. Bose in 1926. Those who achieved the goal in 1995 were awarded the Nobel Prize in 2001.

But will he make a good energy secretary?

Chu is no dyed-in-the-wool, ivory-tower type physicist. He is also one of America’s effective advocates for scientific solutions to global warming and the need for carbon-neutral renewable sources of energy. In this regard, he fits perfectly well into Obama’s green energy agenda which the latter has eloquently espoused during the heated electoral campaign. The new presidency aims for a low-carbon society by building more wind, solar, geothermal, biomass and hydro facilities.

Obama understands that crafting a viable energy policy could make or break his presidency. He also understands that the process is complex and requires the brightest minds to help him steer his energy ship to the right direction. His choice of Chu reflects the importance he gives to energy issues.

In his numerous forays around the globe, Chu has delivered a consistent message centered on “stronger storms, shrinking glaciers, prolonged droughts and rising sea levels” in apparent reference to the dire consequences of global warming.

Since assuming the directorship of Berkeley Lab in August, 2004, Chu has marshaled the Laboratory’s considerable scientific resources on energy security and global climate change, the production of new fuels and electricity from sunlight through non-food plant materials and artificial photosynthesis, energy-efficient technologies and climate science.

University of California Chancellor Robert Birgeneau who has known Chu for decades has this to say about the character of the man: “Steve Chu has been relentless about addressing the technical challenges of renewable energy in a deep way. We will now have an energy policy that can mean the U.S. will have a chance of obtaining energy self-sufficiency through new technology.”

Among other things, Chu was credited with helping establish the Joint BioEnergy Institute (JBEI), a $135 million DOE-funded bioenergy research center and the Energy Biosciences Institute (EBI), which was bankrolled by a $ 500 million grant from British Petroleum.

“Steve Chu has been an incredible visionary and true leader, particularly in the area of energy,” said Jay Keasling, who heads JBEI. “Now the country and the world will benefit from that vision and leadership."

He will be missing the ensconced academic life. But LBL’s loss will be America’s gain when the physicist-energy advocate brings his scientific talent, vision and passion for energy and the environment into the highest chambers of national energy policy.

How we wish that such inspired choice to head a very important government agency would be translated to our local situation!
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Note added, December 19, 2008: The papers reported today that the powerful senate Commission on Appointments bypassed the confirmation of Department of Energy Secretary Angelo Reyes and Department of the Environment and Natural Resources (DENR) Secretary Lito Atienza along with three other cabinet members. The most vocal critics of Reyes are energy committee chairperson Senator Miriam Defensor-Santiago and Senator Jinggoy Estrada, whose father was ousted in 2001 and under which Reyes served as Army Chief of Staff. Defensor-Santiago simply said that Reyes is unfit to be an energy secretary.

DOE plans yet another energy plan extending to 2030

THE GOVERNMENT, through the Department of Energy, is at it again.

In a recent briefing, Energy Secretary Angelo T. Reyes told the media that the Philippine Energy Plan (PEP) would be extended to 2030 as the 2005-2014 plan was "not applicable to some regions" which can be interpreted as an oblique admission that the original plan was full of holes, to put it kindly.

We are only three years into the original plan, yet we are effectively dumping it in the guise of extending it far into the future when nobody wouldn't, or couldn't, validate the plans.

The 2005-2014 PEP targets a 60% energy self-sufficiency level by 2010 and pursues effective reforms in the power sector. In effect, these aims are no longer valid.

The major problem of such a plan is not so much on the length of time, but on the soundness of the content. If one looks back at the 2005-2014 PEP plan, some are bordering on the grandiose bereft of solid fundamentals. Even a simple assessment of the electricity supply and demand situation for the next few years was off the mark.

Some aims were more of motherhood statements than concrete plans. For example, the plan aims to make the Philippines the number one producer by 2014 I believe, yet no rigorous verification was made whether such listed areas were in fact capable of producing the indicative MW outputs. If one were to compare our geothermal program with those of others such as the US and Indonesia, the gap between our production with US will widen by a huge margin, and we would be eating the dust of Indonesia even if we only count the committed and ongoing geothermal projects of the latter. We will surely slide to third, or even fourth worldwide.

For another example, the plan declares that we would be the premier wind energy producer by the end of the period, yet there is not even a comment whether the infrastructure to achieve such aim is in place. The Department cannot even push for the passage of a renewable energy bill which could be a springboard of a nascent renewable energy industry to significantly grow. The renewable energy bill itself, which is pending in congress for ages, does not have much substance.

The Department even relies on a study by the U.S., National Renewables Energy Laboratory (NREL) for the inventory of our own wind energy resources.

What the Department could do for example, rather than making yet another grand plan that stretches far into the future, is to set down and carefully study the implications of the renewable energy bill's provisions.

The end product could be white papers on renewable portfolio standards, how to set up the net metering infrastructure, or even the pros and cons of a feed-in tariff system which jumpstarted the wind and solar power industries in many areas of the world, but did not merit any mention at all in the RE bill.

Our legislators are too busy politicking to come up with really outstanding pieces of legislation that could help shape our energy policy. At the very least, the Department could pitch in to educate our lawmakers. Whatever comprehensive energy policy we have, if any, would now be sorely antiquated.

In the meantime, the international energy industry is in a swirling vortex, with energy and commodity prices in a wild roller coaster ride, and all our policy makers could do is watch helplessly in the dust, and wonder what has happened.

Capital intended for energy infrastructure around the world has been zigzagging across national boundaries, looking for worthwhile projects, but most are bypassing the country. Why, the DOE should ask.

Trading of carbon credits and other energy related financial instruments has been swelling at a blistering pace for the last two years, with the voluntary carbon market-- as opposed to the regulated carbon market-- tripling each year in value with hardly anyone from our energy policymakers noticing. The generators of these trad able instruments come mostly from renewable energy projects from developing countries, the Philippines included, only if we have put the right infrastructure in the first place.

There are many other worthwhile projects for our DOE other than crafting yet another nebulous energy plan.

Is nuclear the way to go? - Re-opening the debate

By J R Ruaya

Energy and Chemistry Consultant

Recently, the Department of Energy is considering undertaking a comprehensive study on the feasibility of delving into nuclear power generation, upon the recommendation of a United Nations-sanctioned body. This is a clear signal that this government is at least dusting off the nuclear files which have been in limbo since 1986, when the newly-installed government of Corazon C. Aquino shelved the operation of the 620 MW Bataan nuclear power plant in Morong. Energy Secretary Angelo Reyes said the eight-person delegation from the International Atomic Energy Agency (IAEA) had recommended the conduct of a thorough feasibility study before deciding whether or not to go into nuclear power generation. The core group who wll conduct the two-year study is composed of key experts from the DOE, National Power Corp. and the Philippine Nuclear Research Institute of the Department of Science and Technology. The IAEA group came to the Philippines in January to visit the mothballed Bataan Nuclear Power Plant (BNPP) in Morong and help the government in deciding whether or not to pursue nuclear power generation. The IAEA team would merely make a recommendation on what could be the best options for the government—whether to rehabilitate and refire the BNPP, to convert it to a plant that used another type of fuel, or to just scrap it altogether.

At about the same time during the Philippine Energy Summit held 28-30 January at the SMX Convention center at the Mall of Asia, Dr. Jose O. Juliano of the National Academy of Science and Technology and a long-time advocate of nuclear power, argued for a fresh look at the nuclear option as part of the country's long-term strategy for energy security.

He cited several advantages of nuclear power such as low pollution emissions, small land requirements in contrast to those of hydro and geothermal which require hundreds of hectares of land often in watersheds and protected areas, small fuel and waste volumes which are meticulously managed, and the existence of a proven intermediary storage.

He pointed out that nuclear power is a non-producer of carbon dioxide, the main greenhouse gas allegedly reponsible for global warming, and other airborne pollutants such as particulates, nitrogen oxides and sulfur-bearing gases which are products of coal and fossil fuel burning.

At the same time, he pointed out its inherent disadvantages in which he singled out the problem of nuclear waste disposal. He noted that there is no final repository in operation, high toxicity of processed fuel which need to be isolated for a long time (decades). He added that this could be a potential burden for future generations.

In terms of economics, Juliano cited its advantages which include: NPPs are cheap to operate, has stable and predictable costs, long life time, secure fuel supply (this is debatable) and low external costs. On the flip side, nuclear power needs a high upfront capital cost, can be difficult to finance, costs can be sensitive to interest rates, long lead times, long payback periods and there are regulatory risks to contend with.

In the mid-eighties, there was a marked stagnation of nuclear power development brought about by a confluence of factors, as Juliano noted. The factors he cited include energy efficiency improvements, economic restructuring, drop in electricity demand, excess generating capacity, oil price collapse, advent of highly efficient, cheap gas turbine technology, electricity market liberalization and privatization in many countries, and regulatory intervention after the Three Mile Island incident.

But today is quite different, Juliano argues. Nuclear is already a proven technology that provides clean electricity at predictable and competitive costs, has 12,000 years of accumulated reactor experience, stringent safety standards are in place, and the nuclear industry itself accepts full responsibility for its waste.

Environmentalists and anti-nuclear activists would quickly pounce upon nuclear's environmental hazards of its nuclear waste and safety records. But, argues the nuclear proponents, environmental contamination due to nuclear plants is far negligible compared to say the massive oil spill by Exxon Valdez and to our own Guimaras oil spill. In terms of safety records, one can only point to the hundreds of coal mine deaths and injuries in China and even the United States which dwarf by orders of magnitude the number of casualties in the nuclear industry.

Here in the Philippines, there are other issues that one needs to contend with. The Bataan Nuclear power plant, argues the opponents, sits near an active geologic fault, and a tectonic movement could release devastation radioactive material from the plant. On the other side of the coin, Japan, which uses about 20 % power from nuclear is as tectonically-active, if not more, than the Philippines. Such an issue has not become a rallying point to Japanese nuclear activists. Emotionally, the Japanese would have the strongest argument against nuclear power, having tasted its deadly side during World War II at Hiroshima and Nagasaki.

A government agency also pointed out that with the mothballing of the Bataan plant, our trained local talent required to run a nuclear power plant has gone on to greener pastures or morphed into something else. It would take years before a critical mass of talent can be assembled if one is to pursue again the nuclear option.

The Ramos administration, after smarting from the massive brownouts in the early '90s, actually included the nuclear option in its agenda, and targeted year 2022 for the opening of a new nuclear facility. The program took into account ther economic scenario then, and included the development of a pool of nuclear talent.

The twin proposals above effectively opened up an invitation to a fresh look on the nuclear option. Beyond passion and emotional baggages from the Bataan plant, one needs a dispassionate and unencumbered platform from which to view the issues involved.

Let us just make sure that the window we are opening leads to a brighter future and not opening a Pandora's box.