Businesses issue urgent call to build new power plants

By Victor V. Saulon, Sub-Editor – October 8, 2018 | 10:25 pm
from Business World

THE Federation of Philippine Industries (FPI) has called for the “immediate” construction of new power plants to ensure ample long-term supply of electricity while the government embarks on its massive infrastructure program.

“We want the power industry to step up and do something, so we can prevent a potential problem on electricity supply,” said FPI Chairman Jesus L. Arranza in a statement on Monday.

The federation, which counts as members 34 industry associations and 120 corporations in the manufacturing sector, called on the power industry to work together to ensure electricity supply and prices will not be an added burden to consumers.

Its call is addressed to the Department of Energy (DoE), the Energy Regulatory Commission (ERC) and private companies. The move comes amid concerns on supply and increasing prices of basic consumer goods and commodities, it said.

FPI also pointed out that most of the power plants in the country are ageing or around 15 years old or older, making them prone to unscheduled shutdowns. It questioned the motives of groups that “consistently block and oppose the construction of new power projects amid concerns on unnecessary delays that many projects are experiencing.”

The federation cited the planned 1,200-megawatt (MW) coal-fired power project of Atimonan One Energy, Inc., which has yet to start construction as it awaits regulatory approvals. It said power plants of that scale take around four to five years to build.

“The Atimonan project is an example of a very significant power project that can ensure supply availability in the future,” Mr. Arranza said.

The project is one of seven power plants with which distribution utility Manila Electric Co. (Meralco) entered into a power supply agreement (PSA) on April 29, 2016, or just before the extended deadline set by the ERC.

After the deadline, companies are required to first undergo a competitive selection process or CSP, which subjects a PSA to price challengers. Some sectors questioned the ERC’s extended deadline, leaving projects with a total capacity of 3,551 MW stalled ahead of the resolution of cases before the court.

Agnes T. Devanadera, ERC chairperson and chief executive officer, said the commission was working on eliminating its backlog of 480 cases, but the seven PSAs had been awaiting resolution at the Supreme Court.

“The seven PSAs are not just pending before the Supreme Court but the division endorsed [them] to the en banc, meaning all the entire Supreme Court will hear the case instead of a division of five or seven,” she said in an interview last week.

“We tried to look for a consensus in the commission and it appears that since [the cases are] now being heard at the en banc we might as well wait for it,” she added.

“It’s a collegial body and I cannot just decide singly,” she said.

Ms. Devanadera said that were it not for the court case, the commission would have been free to process the PSAs, which previously met with delays at the ERC with the suspension of four commissioners. Rate-setting cases require a majority vote of the commission.

The ERC will this week have a full complement of five commissioners plus its chairperson as the suspension ends, which also comes after the appointment of two new commissioners as replacements for those who retired.

Separately, the DoE said on Monday that it was rolling out energy projects in Mindanao with the holding of a forum that would present the investment opportunities in the region.

“The forum aims to present opportunities and updates on energy developments, which include the one-grid interconnection project and the establishment of additional power capacities in the area,” the DoE said in a statement.

The DoE said it aims to “bridge investors with financing facilities available for energy projects, concerned government institutions and the business sector for knowledge sharing on the industry’s best practices in the region.”

It earlier certified the Atimonan project as an energy project of national significance, a policy establishing a simplified approval process while harmonizing the relevant rules and regulations of government agencies involved in the permitting process.