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Amid Mindanao crisis, critics say DOE partial to ‘dirty’ coal-fired power plants

The Agus hydropower plant is one of Mindanao's main sources of electricity.

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CAGAYAN DE ORO CITY, Philippines - Instead of protecting and advancing Mindanao’s competitive advantage by developing more hydropower plants, the Department of Energy (DOE) is showing bias for coal-fired power plants to address the island’s electricity shortfall, a renewable energy advocate said.

Mindanao, the Philippines’ second-largest island group, is blessed with so much natural resources, especially water resources that can be tapped as renewable energy source for cheap electricity in the island.

“But Mindanao’s call for clean hydropower project developments has so far seem to remain unheeded by the DOE, indicating a partiality towards approving fossil-fuel based coal plants such as the 300 megawatt Aboitiz thermal plant in Davao, the 200 megawatts of Conal Holdings in General Santos, and other coal plants from high-profile developers such as San Miguel and Ayala Group, among others,” said Greenergy Development Inc president Cerael C. Donggay.

A former National Power Corp vice president for Mindanao, Donggay said Greenergy and the First Bukidnon Electric Cooperative initiated the P33 billion 300-MW Pulangi 5 Hydropower Project in 2008. It is located 40 kilometers downstream from the existing 255-MW Pulangi 4 in the southern part of Bukidnon covering the municipalities of Kitaotao, Dangcagan, Kibawe and Damulog. Its dam will be located in the municipality of President Roxas, North Cotabato.

State-owned Napocor proposed Pulangi 5 in 1991, but deferred implementation because of a power crisis and the 1997 Asian financial crisis. The company gave up on the project in 2001 with the passage of the Electric Power Industry Reform Act of 2001 (EPIRA).

In June 2011, the Infrastructure and Utilities Development Committee of the Regional Development Council-X (RDC-10) endorsed the Pulangi 5 after finding it financially viable. 

Greenergy and the Northern Mindanao Electric Cooperatives Association, which has as members 8 electric cooperatives in the region, initiated the 132-MW Bulanog-Batang Hydropower Project in 2005, also in Bukidnon.

Localize power generation

These two projects are “moves to localize and make independent Mindanao’s generation of power,” said Donggay.

Hydroelectric power is a renewable energy, along with biomass, solar, wind and tidal because they are “naturally occurring inexhaustible sources of energy," he said.

But instead of developing clean renewable energy sources, the DOE instead prioritized the development of coal-fired power plants as solution to the Mindanao power crisis, he said.

In its Philippine Energy Plan (PEP) 2009-2030, the DOE gives priority to fossil fuels such as oil, gas and coal. Number one in the PEP 2009-2030’s policy thrust of energy security is to “accelerate the exploration and development of oil, gas and coal resources,” ahead of the “development and utilization of renewable and environment-friendly alternative energy resources/technologies."

Many are opposing coal as source of energy because it is dirty and its ash fall toxic to the environment and human health. Opposition has grown amid calamities spawned by global warming and climate change, to which coal contributes.

Energy sector experts are unanimous that Mindanao needs new power generation plants not only because of its aging workhorses - the Agus and Pulangi hydropower complexes in Lanao del Sur and Bukidnon provinces, respectively - but also because energy demand is increasing.

But clean renewable energy advocates point out that Mindanao has no need for expensive and dirty fossil fuel-based power plants because the island has vast renewable energy reserves with over a thousand megawatts from hydro, 400 megawatts from wind and the still unexplored potential of solar power.

They demand that DOE and the government help Mindanao protect its competitive advantage by tapping these vast reserves of renewable energy.

“Cheap hydropower remains key to Mindanao’s development strategy as this remains our competitive advantage,” Secretary Luwalhati R. Antonino, chairperson of the Mindanao Development Authority, said during the Mindanao Power Summit held April 13 in Davao City.

Balanced energy mix

However, various scenarios point to a balanced energy mix in Mindanao in order for the island to remain competitive as well as ensure reliability of supply and build a sustainable solution to its power crisis, said Manuel M. Orig, Aboitiz Power Corp first vice president for Mindanao affairs, during a presentation in the Davao Investment Conference held on November 17.

"We should pursue as much renewable energy sources as possible as long as it will not prohibitively expensive to consumers,” Orig said.

“At the same time, we must realize that renewable energy will not be enough to fill the present shortfall. So we must also utilize non-renewable power sources that use modern technology to ensure there are no adverse effects to the environment.”

Aboitiz Power, which is building a coal-fired power plant in Davao, said coal is not its only solution to the Mindanao power crisis.

Aside from coal-fired power plants, Aboitiz Power, through its unit Hydro Electric Development Corp (Hedcor), is building the P1.8 billion 7-MW Tudaya Hydropower Plant 2 in Sta. Cruz, Davao del Sur. It is located downstream from Hedcor’s existing Sibulan Hydropower Plant B.

Hedcor is also awaiting the go-signal for the construction of the 13-MW Tamugan Hydropower plant. It also has in the pipeline the construction of the 28.2-MW run-of-river hydroelectric projects that will harness Sita and Simod rivers in Kitaotao, Bukidnon.

“Aboitiz Power believes in hydro. That is why Hedcor is building left and right. But Mindanao needs a balanced source of energy. We cannot be dependent on just one source. If we go all coal, we are dependent on world coal prices. If we go all diesel, it may be too expensive. If we go all hydro, we will be dependent on weather conditions. By balancing our sources, we get the security/reliability of coal and the pricing advantage of hydro. We get the best of both worlds,” said an Aboitiz Power official who sought anonymity.

“We have said over and over again that coal will never replace hydro. Hydro will still be the bread and butter power source of Mindanao. We just need to widen our fossil-based baseload portfolio so Mindanao will not be in the dark during summer months when power consumption goes up,” the source added.

Orig said only non-renewable energy sources like coal can fill the supply shortfall in Mindanao, while keeping the prices competitive for consumers and businesses.

As of November 19, Mindanao was short of 420 MW. The shortage is projected to increase to 484 MW by 2014, enough to cut power entirely from the cities of Davao, General Santos, Butuan, Zamboanga and Cagayan de Oro.

Orig said Aboitiz Power hopes the early completion of its coal and hydropower plants by early 2015 will help solve Mindanao's crisis.

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