DOE to stop endorsing new coal power plant projects
By Lenie Lectura – October 28, 2020
from Business Mirror
File photo: Residents of Barangay Bani take to the shore near the Masinloc coal-plant jetty to collect shellfish.
THE Department of Energy (DOE) will no longer endorse new coal power plant projects.
Based on a recent review on the country’s power mix, the agency said there is a need to declare a moratorium on endorsements for greenfield coal power plants.
DOE Secretary Alfonso G. Cusi said the periodic assessment of the country’s energy requirements revealed the need for the country to shift to a more flexible power supply mix.
This move, he said, would help the country build a more sustainable power system that will be resilient in the face of structural changes in demand and will be flexible enough to accommodate the entry of new, cleaner, and indigenous technological innovations.
DOE Undersecretary Felix William Fuentebella said the
morato rium would not cover those in the agency’s indicative list of coal power projects. “We are referring to new ones,” he said.
At the same time, Cusi said the Philippines is now allowing 100-percent foreign ownership in large-scale geothermal exploration, development, and utilization projects. Large-scale geothermal projects are those with an initial investment cost of about $50-million capitalization through Financial and Technical Assistance Agreements (FTAAs).
FTAAs may be entered into between foreign contractors and the Philippine government for the large-scale exploration, development, and utilization of natural resources, and are signed by the President.
Cusi announced this during the 2nd Global Ministerial Conference on System Integration of Renewables, which was held as part of the Singapore International Energy Week 2020.
“While we have initially embraced a technology neutral policy, our periodic assessment of our country’s energy requirements is paving the way for innovative adaptations in our policy direction,” Cusi said.
The moratorium on the endorsements for greenfield coal power plants and the opening up of the country’s geothermal sector to greater foreign investments in order to boost the prospects of the local renewable energy (RE) landscape, are but among the innovative policies that the DOE will be implementing.
Cusi said he signed in October 20 a Department Circular providing the guidelines for the third Open and Competitive Selection Process (OCSP3) in the awarding of RE Service Contracts.
“From an investment perspective, OCSP3 allows for 100-percent foreign ownership in large-scale geothermal exploration, development, and utilization projects. As the Philippine Department of Energy reevaluates the appropriateness of our current energy mix vis-a-vis our energy goals, I am optimistic that this would lead to more opportunities for RE to figure prominently in our country’s energy future,” he said.
As of 2019, the Philippines still had the highest RE share in the total primary energy supply from among countries within the Association of Southeast Asian Nations (Asean) region.
“Despite this, I am determined to accelerate the development of our country’s indigenous resources. We are also pushing for the transition from fossil fuel-based technology utilization to cleaner energy sources to ensure more sustainable growth for the country,” he said.
The virtual ministerial conference in Singapore was organized by the Energy Market Authority, the International Energy Agency, and the Ministry of Trade and Industry of Singapore for the 13th Singapore International Energy Week.
Based on DOE data, there are seven indicative coal power plant projects in Luzon. These, if approved by the DOE, will add 8,275MW of additional capacity.
There are four Indicative coal power plant projects in Visayas and Mindanao, with a total additional capacity of 763MW.
As of end-2019, coal still dominated the power mix at 54.6 percent; natural gas, 21.1 percent; geothermal, 10.1 percent; hydro, 7.1 percent; oil, 3.5 percent; and RE at 3.1 percent.
