Wednesday, 17 February 2010

‘No brownouts in Luzon till June’

Paul Anthony A. Isla
Business Mirror
http://www.businessmirror.com.ph/index.php?option=com_content&view=article&id=21946:no-brownouts-in-luzon-till-june&catid=33:economy&Itemid=60

CONSUMERS can rest assured that power supply in Luzon will remain uninterrupted up to June.

This assurance was made after Energy Secretary Angelo Reyes said on Tuesday that the 620-megaWatt (mW) Limay combined-cycle power plant was coming online yesterday (Tuesday) following an agreement signed by San Miguel Energy Corp. and Alstom Philippines Inc.

“We can rest assured that there will be no brownouts up to June in Luzon. Unless you have two power plants suddenly conking out, and this is very unlikely. But if only one power plant conks out, we still can handle the situation,” Reyes said in a press conference.

Initially feeding 55 mW to the Luzon grid, according to the energy chief, the Limay will eventually romp up its capacity until it reaches its full capacity.

Reyes also noted that there have been some developments, such as the Magat and the Kalayaan hydro power plants, which produced additional power partly owing to the cooler weather.

“The demand for cooling had been less. And this helps alleviate the problem, and these are factors that have contributed to the situation having been addressed,” he added.

In a separate press conference, lawyer Francis Saturnino Juan, executive director and spokesman for the Energy Regulatory Commission (ERC), said the price of power generated from Limay will depend on what SMEC and a distribution utility will agree on.

“However, if the Limay will sell the power it produces to the Wholesale Electricity Spot Market, then the rate to be applied will be based on the market price,” he added.

Juan said Limay could also be dispatched as a must-run unit.

A must-run unit, according to Juan, refers to a power plant that is required to run even without the need to make an offer to the market but will paid based on the market price of power.

Juan warned that Limay can even haggle for an additional compensation if asked to operate as a must-run unit.

Reyes said if Limay is declared a must-run unit, there must be a mechanism for it to be properly compensated through the filing of appropriate documents with both the Philippine Electricity Market Corp. (PEMC) and ERC.

PEMC and ERC, Reyes said, have assured him to act expeditiously on any petition for additional compensation to be asked by SMEC.

“Definitely, it will have an impact on the rates to consumers, as you cannot have electricity at no cost. But I’m certain the ERC will act on it and make sure that the cost burden will be distributed equitably,” Reyes said.

Carlito Claudio, deputy assistant chief technical officer of the National Grid Corp. of the Philippines (NGCP), said on Tuesday the available capacity is 7,100 mW, the projected peak demand is 6,600 mW, and the reserve is estimated to be about 500 mW even with the Limay out.

So if Limay comes in at 540 mW at its full capacity, Claudio said the reserve will be more than 1,000 mW.

Claudio said demand-side management will have an impact in making the supply stable.

“With residential customers accounting for 30 percent of the consumption, a reduction in their consumption will be a big help in bringing down the demand,” he said.

Reyes also said the Luzon grid is on white alert or having enough reserves to address a contingency brought about by one plant conking out.

There are two types of reserves such as regulating reserves (spinning), which ensures the uninterrupted, quality supply of power; and contingency reserve, which ensures a power could be immediately brought in case any power plant conks out, he explained.

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