Law seen boosting RE shift via natgas
LNG’s price has inched to $16 per one million British thermal units (MMBTu), translating to higher electricity prices to the detriment of consumers
By Maria Bernadette Romero – 30 Sep 2024, 00:20
from Daily Tribune
Natural gas plays a crucial role in the shift toward renewable energy (RE) as the Philippines moves to become a more sustainable and climate-resilient economy. It provides a stable power supply that helps reduce carbon emissions while maintaining energy security.
In line with this, the Lopez-led First Gen Corporation has committed to expanding its natural gas facilities to support the nationwide bid to augment RE capacity.
A Senate body, nonetheless, stressed the need to prioritize indigenous gas amid the upswing in the prices of liquefied natural gas (LNG).
LNG’s price has inched to $16 per one million British thermal units (MMBTu), translating to higher electricity prices to the detriment of consumers.
Senator Pia Cayetano, chairperson of the Senate committee on energy and sponsor of Senate Bill 2793, or the Philippine Natural Gas Industry Development Act, debunked claims that current LNG prices are lower than indigenous or Malampaya gas.
Data from the natural gas market shows Malampaya gas costs only $12.8 per MMBtu while LNG is currently at $15.3 inclusive of all regasification and other costs to generate power. LNG prices are expected to go even higher as winter approaches. Senator Sherwin Gatchalian earlier erroneously claimed that LNG costs only 10.5 US dollars per MMBtu.
Cayetano renewed her call to his colleagues to take a patriotic stand in favor of local natural gas resources by passing SB 2793. She said the proposed legislation will ensure that the country will not be dependent on foreign fuel.
Seamless clean energy shift
Speaking at a forum hosted by the Net Zero Carbon Alliance, First Gen chairperson and CEO Federico Lopez emphasized natural gas’ vital role in ensuring a smooth transition to cleaner energy sources.
“Natural gas can do two things: it can generate a kilowatt-hour with half the emissions of a coal plant. Secondly, as more and more REs come into the grid, which is intermittent, you will need to have power plants that can ‘load follow,’ that can ramp up and down very quickly. Natural gas can do that; coal cannot,” Lopez explained.
The latest Philippine Energy Plan (PEP) outlines the target of increasing RE’s share in power generation to over 50 percent by 2050.
However, with peak power demand expected to rise from 16,596 megawatts (MW) in 2022 to 68,483 MW by 2050, the transition poses challenges, particularly with the intermittent nature of RE sources like solar and wind.
Lopez noted the growing need for clean energy, noting that “by 2050, we will need five times the electricity we use today; and we will need 10 to 12 times the clean energy in use today.”
SB 2793 provides incentives to the full exploration and development of the country’s indigenous natural gas resources to address energy security concerns using Filipino gas first.
