Postponement of power crisis is no reason to rejoice

During a recent industry briefing, Department of Energy Secretary Angelo Reyes announced that brownout in Luzon may only happen next year as the electronics industry, the biggest power user in the island, continues to be pummelled by a lingering financial crisis.

He even considers it a positive side effect of the continuing economic crisis even as power supply in the Visayas and Mindanao has tightened with brownouts already occurring at increasing frequency.

How could he say that?

Trying to assuage fears of consumers of massive power outages by playing up the woes of the electronic sector is not a comforting stance given by no less than the top guy in charge of a Department which is supposed to nurture the power sector to health. Such a blasé attitude could spawn complacency when in fact the power industry should be on a war footing to avert a looming power crisis.

He did promise to give the list of prospective power investors, but couldn’t provide it at the right moment—which is the economic briefing itself. Such ill-preparedness smacks of the attitude the Department has shown in dealing with the problems in the power sector.

What we need is a strategic power development plan, not ad hoc knee-jerk reactions to problems as they tumble along. An important player and a responsible person of the industry should not express glee when a looming crisis was unexpectedly averted due to another crisis.

The Philippine Chamber of Commerce and Industry (PCCI)has already shown that brownouts had started in the Visayas and this year it will be Mindanao’s turn, according to its recent assessment of the prospects and challenges (read: problems) of the power sector. Next year, Luzon will be hard hit.

The Chamber estimates that to avert the crisis, there is an urgent need to build 3,000 MW of capacity in Luzon between now and next year, another 1,000 MW in the Visayas and 1,000 MW in Mindanao. Yet our Energy department chief cannot even provide the potential investors, or even rattle off potential investments from his head—which he should have easily done if he is in tune with the industry. Most likely, there is no such list.

But PCCI vice president Jose Alejandro reminded everyone that conventional base-load power plants with at least 300 MW could take at least three years to build, which is his polite way of saying that the power crisis can no longer be averted.

Our energy department head has apparently not imbibed the crisis mentality during the time of his previous boss, ex-President Fidel Ramos, when the latter had to compromise with high costs of BOT plants as a stopgap measure to a raging power crisis then.

It seems we are now resigned to debilitating power shortages starting this year.

Palawan power crisis once more highlights weakness of electric cooperatives

Palawan business leaders have been feeling the pinch of persistent and prolonged power brownouts in the province and the city of Puerto Princesa and warned the problem “could get worse” and could jeopardize efforts to make Palawan a major international tourist destination.

In the past few months, local business leaders have noted that the power interruptions have become longer and more frequent, and have become a major disincentive to business and tourism.

According to the National Power Corporation (NPC), there are some 40 megawatts (MW) of installed electrical capacity in the province while the peak demand reaches only 21 MW, so the problem could only lie within Palawan Electric Cooperative (Paleco), the local distribution unit. NPC is however silent on how much of the installed capacity is dependable, but it is unthinkable that half of it cannot be dispatched.

In many rural areas and island provinces, power supply has been a major complaint regarding basic necessities, and the common denominator of these areas is that power distribution is being handled by poorly managed, inefficient electric cooperatives. Electric cooperatives which have been given passing marks by their consumers are the exception.

Perhaps, it is about time to have a radical re-think about electric cooperatives. With no shareholders breathing on their necks, management of many of these cooperatives does not have real incentives to professionalize its operations. Oftentimes, management and members of the board are handpicked, or beholden to local officials, if not directly controlled.

There seems to be a lack of incentive to modernize the equipment, or at least maintain properly the existing ones. Customer service is farthest from the minds of these minnows pretending to be running a basic service provider.

Why is it that there is no concrete strategy to ultimately privatize these distribution units?

It used to be that these basic services (power distribution, telecommunications, and water) were thought to be a natural monopoly of the state, and therefore, should be run, or at least controlled by local government units. Not anymore, as shown by the telecommunication and water distribution—at least in major urban areas—industries.

Whenever there is clamor to privatize an electric cooperative, there seems to be a helluvah of opposition. But if you listen carefully above the din, the noise one seems to hear is that of local political interests who are likely to lose some perks and wealth once control is transferred to the private sector--not the consumers who silently groan under inefficient services and high rates.

Palawan is but a sorry example of our sordid, highly inefficient electricity distribution systems in many parts of the country.

Clean coal?

By J R Ruaya

Last weekend in Iloilo City, Energy Secretary Angelo Reyes declared that he is in favor of building new coal-fired power plants in the Visayas as long as they use the so-called “clean coal technology”. He made his position on the issue amid his advocacy in the promotion of renewable energy sources.

It was a brave pronouncement, a calculated one, amidst active protests against coal in particular and environmental degradation in general. At the same he was making the statement a group of environmentalists have scaled nearby Mt. Kanlaon to protest the granting of permit to geothermal developer PNOC-EDC to enter Mt. Kanlaon National Park. A few days earlier, Greenpeace environmental activists vandalized a ship loading coal to Pagbilao power plant in Luzon.

For sure he will get rotten tomatoes plastered on his face, but at least Reyes is showing pragmatism in the face of mounting power crisis especially in the Visayas on one hand, and a noisy environmental movement on the other.

According to Reyes, the country could veer away from coal power plants, but not now.

“We still have coal-fired power plants firing up Luzon grid,” Reyes said. Coal accounts for 30 and 25 percent of Luzon and the Philippine generation mix, respectively.

He said the government has to balance the need of the country in terms of power.

“Coal will continue to be the bridge fuel,” he said.

Clean coal?

Clean coal will continue to be an oxymoron for many years to come. What is touted as clean coal technology is broadly understood to be any technology that has the capability to substantially reduce the "dirty" side associated with coal burning; noxious sulfur and nitrogen oxides, carbon dioxide which is accused to be the main culprit of man-made global warming, lead, mercury, arsenic and other poisonous heavy metals, fly-ash or particulates and residues consisting of inorganic materials. Also to be included is the attendant environmental degradation during coal mining.

The term's origin could be traced back to the U.S Department of Energy's Clean Coal Technology Program which was launched in 1986 and continued for more than twenty years with not much to show off. Recently, this has been replaced with the FutureGen project which is an ambitious undertaking to finally make coal "squeaky clean" to the satisfaction of environmental standards, and also to appease the green activists.

That the U.S. leads in research and development to make coal palatable is hardly surprising. Despite being a first world country with high standard of environmental protection, 52 % of its electricity needs comes from burning coal. The percentage is not expected to come down even 20 or 30 years from now. Coal is still cheap compared to alternatives, and the U.S. has plenty of it, producing about 27% of the world output yearly.

A significant improvement to the conventional pulverized coal burning is the use of fluidized bed technology wherein coal powder is suspended in fluid form while burning. This significantly brings down airborne particulates but not carbon dioxide and the noxious oxides. One still has residue to dispose of.

Of the 31 or so projects funded by US DOE at a cost of some $2.75-B, perhaps the project that came close to "clean coal technology" is the integrated cycle coal gasification (ICCG) plant wherein coal is turned to gas before being burned to generate electricity. So far, no significant commercial taker has come forward.

A demonstration ICCG plant has been recently built at a cost of $600-M with some $140-M grant coming from the DOE, by Tampa Electric Co., in Polk, Florida which is 10% more efficient than most coal-fired plants. But still, it is far from clean. While the plant captures all of its fly ash, removes 98% of sulfur and nearly all of its nitrogen oxides, the operator admits that it is not designed to remove mercury, one of the most toxic substances known to man, or carbon dioxide.

A more ambitious undertaking is a small project at the Los Alamos Research Laboratory which is dubbed "zero emission coal alliance" (ZECA) which aims to trap all pollutants. The ZECA plant combines coal gasification with a process that absorbs coal in magnesium silicates, which is quite common and inexpensive. The rock dust with CO₂ will then be buried underground. A researcher involved in the project thinks that it could take 20 years for the project to completion and could double the price of electricity compared to a conventional coal-fired plant.

Carbon dioxide sequestration, as the technology is also known for, if successful, is a geological and technological marvel, simply because of its scope. It is estimated that 2.5 billion tons of CO₂ is emitted by U.S. coal plants yearly; at least 1/3 of that should be removed for the technology to have an impact on CO₂ reduction efforts.

Another innovative idea is the use of algae for carbon capture using a process that has been with us for millions of years:photosynthesis. Algae, in batch reactors, capture the CO₂ emission of a coal plant, while the grown algae themselves, once dewatered, may be converted into vehicle-quality biofuel. NRG Energy is pilot testing the process in one of its plants at Loiusiana, while another outfit, Sapphire Energy, believes the idea is feasible and is putting some efforts to realize it.

Other ideas being tried out include conversion of coal to fuel gas or liquid, which is then burned to produce electricity or used in vehicles. This and other propositions require that oil prices remain high to become viable. There are also technical hurdles to overcome in the laboratory and demonstration trials.

Much of these efforts has been stymied by high costs and the advent of cleaner and cheaper natural gas plants in the 80s and 90s. However, with oil prices breaching $130 to a barrel, "clean coal technology" is getting a second look.

Pragmatism required

To immediately address the looming power crisis in the Visayas, pragmatism should prevail over wishful thinking by considering any proposed coal plant on a case to case basis while "clean coal technology" is still a mirage on the horizon. The alternative is a debilitating power crisis that is to occur sooner than later.

So, Secretary Reyes is unlikely to have his wish granted. The best he could get is an improved coal plant over the existing ones.

But it would be far from clean.