Major coal players to abide by D.O.E. ban on ‘new’ projects
By Lenie Lectura – October 29, 2020
from Business Mirror
Calaca coal-fired power plant located in Calaca, Batangas, has been the subject of protest actions by environmental and climate justice activists.
MAJOR coal power plant producers are supporting the Department of Energy ‘s (DOE) pronouncement to stop endorsing new coal power plant projects.
The country’s power mix is dominated by coal, being the cheapest among the technologies available. Based on DOE figures, coal’s share in the capacity mix stood at 40.5 percent, followed by oil at 16.8 percent, natural gas at 13.4 percent and renewable energy at 29.3 percent. The share of coal-fired power could increase to 60.2 percent by 2029 from last year’s 54.6 percent, according to a Fitch Solutions report last September.
The DOE, based on its latest review, declared a moratorium on endorsements for new coal power plants, citing a need to shift to a “more flexible power supply mix” that would help build a more sustainable power system in the country.
“Our periodic assessment of our country’s energy requirements is paving the way for innovative adaptations in our policy direction,” Energy Secretary Alfonso Cusi isaid.
When sought for comment, AC Energy Inc., Aboitiz Power Corp., Semirara Mining and Power Corp. (SMPC), San Miguel Corp. (SMC) and Meralco PowerGen Corp. (MGen) said they will abide by the DOE’s decision.
“It’s a bold and progressive policy. It’s quite commendable as it demonstrates our government’s commitment to energy security and sustainability. AC Energy is fully supportive of Sec. Cusi’s direction and we will continue to scale up our renewable energy investments in the country,” said AC President Eric Francia in a text message.
Aboitiz Power Corp. also supports making the Philippine energy system more flexible, resilient and sustainable.
“AboitizPower’s growth strategy for the next 10 years remains the same, which is to significantly grow our renewables portfolio, Cleanergy. We have been a pioneer of renewable energy in the country. Our diversification into thermal technologies was primarily driven by the country’s need for a reliable, accessible, and affordable power supply,” said company President Emmanuel Rubio via e-mail.
Aboitiz Power, he added, is committed to meet its goal of a more balanced energy mix or an almost 50:50 Cleanergy and thermal capacities by 2030.
SMC President Ramon Ang replied in the affirmative when asked if the company will comply with the DOE pronouncement.
MGen, the power-generating arm of Meralco, said the moratorium would not affect its existing coal power projects, since these were endorsed by DOE prior to Cusi’s announcement on Tuesday.
“If you are referring to Atimonan, it already has DOE approval as a Committed coal project & also a Certified Energy Project of National Significance from DOE. In addition, it already has DENR ECC approval & NGCP connection agreement. So, the moratorium will not affect our Atimonan project,” said MGen President Rogelio Singson in a text message.
But if given a choice, Singson said the company would utilize supercritical HELE (High Efficiency Low Emission) technology in its power projects.
SMPC Chairman Isidro Consunji also said the company’s coal plants were given the green light by the DOE. “This applies to new plants, not to the ones with permits. We are putting one in Palawan and may bid for new plants for Meralco but [these were] permitted a long-time ago,” he said via text message.
While consumer groups lauded the DOE’s decision, they worry over how the moratorium could affect power rates.
“P4P welcomes the moratorium on DOE endorsements for greenfield coal power plants, but we have reservations on how it would affect power rates as the country seeks to recover from the coal pandemic,” said Power for People (P4P) Coalition in a statement. “The long-term benefits of coal would be complemented by decisive action on the part of the government to also address the short-term effects of the bill shock which happened during the enhanced community quarantine period. Only with concrete action on both the short-term and long-term can the DOE begin to truly say it is prosumer.”
The Center for Energy, Ecology and Development (CEED) commented that this move would block off at least 10.7 gigawatts (GW) of coal in the pipeline.
“We are thrilled by the DOE’s declaration of a moratorium on endorsing new coal plant applications. However, the DOE cannot stop here. If it has to make up for the years it stood by its so-called technology-neutral policy, it has to follow up with the phaseout for the currently installed 9.8 GW of coal in the country.
Without this, the suffering of coal-affected communities, soaring electricity prices, and fossil fuel pollution would continue to proliferate,” said CEED.
For its part, Laban Konsyumer Inc. said coal power plants dominate the country because renewable energy (RE) technology is more expensive.
“We have a competitive selection process approved by the Supreme Court. Let that policy mature and to enable power plants and distribution utilities to provide least cost to consumers. Renewable energy was made too expensive by no less than ERC [Energy Regulatory Commission],” said LKI President Victor Dimagiba.
DOE Undersecretary Felix William Fuentebella said the moratorium would not cover those in the agency’s indicative list of coal power projects. “We are referring to new ones,” he said.
DOE data show 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.
