GIVEN expectations that Mindanao will experience energy oversupply in the next few years, the next big challenge now for electric cooperatives (ECs) and distribution utilities (DUs) is to maximize their energy mix and ensure affordable power for their consumers, a Mindanao Development Authority (MinDA) official said.
“It is now all about achieving a balanced mix of their sources. Electric cooperatives and distribution utilities must now take advantage of the abundant supply and cheap hydro power but at the same time utilizing their coal power supply contracts,” MinDA deputy executive director Romeo Montenegro said over the weekend.
“Power distributors must balance reliability, sustainability and most importantly, affordability of power,” said Montenegro, who also heads the technical working group of the Mindanao Power Monitoring Committee (MPMC).
The Duterte administration has pushed for a “technology agnostic” approach on energy security – prioritizing affordable power no matter the technology, to sustain the country’s industrialization.
The Department of Energy (DoE) has adopted an energy mix policy of 70 percent baseload, 20 percent mid-merit and 10 percent peaking, instead of setting a cap per technology.
Although hydro power courtesy of the Agus-Pulangi complex remains to be the biggest and cheapest single source of power in the island, several coal power plants have come online in the last two years and, combined, now account for around half of the supply.
At present, AboitizPower, San Miguel Energy, Filinvest and Sarangani Energy have completed their coal power plants and have started supplying energy to the grid. The flood of new capacity is causing an oversupply of power in Mindanao, an island that just last year suffered up to 8 hours of power curtailments daily in some areas.
However, Montenegro said that the oversupply must also be balanced well as some electric cooperatives have over-contracted. He encourages electric cooperatives to properly plan their demand forecast to better manage their supply.
“Their ultimate concern must be the welfare of their consumers. What will give consumers the reliability and what will be cheapest,” he said.
Created in 2012 through Executive Order 81, MPMC is tasked to coordinate the efforts of the national, regional, and local governments and power industry stakeholders to improve Mindanao’s power industry.
With MinDA and DoE as co-chairs, MPMC is composed of the Energy Regulatory Commission (ERC), National Electrification Administration (NEA), National Power Corporation (NPC), Power Sector Assets and Liabilities Management Corporation (PSALM), Mindanao Electric Power Alliance (MEPA), Association of Mindanao Rural Electric Cooperatives (AMRECO), National Transmission Corporation (TransCo) and the National Grid Corporation of the Philippines (NGCP).