Tight power supply looms over 2012, says Energy chief

The Department of Energy warned Thursday that Luzon and Visayas may have a “tight reserve situation" of 300 megawatts next summer and possibly brownouts by 2014 if the “needed" baseload plants fail to go online. “Next year will be a tight summer… tight reserve situation. It would probably be around 300 megawatts. I need a baseload of 600 megawatts. Gusto kong i-augment ‘yung baseload," Energy Secretary Jose Rene Almendras said Thursday in a huddle with news media in Makati. Almendras admitted that opposition from various sectors and at the local government level is blocking efforts of various groups to add “baseload power plants" to the Luzon and Visayas grids. “AES Masinloc, hinaharang," Almendras noted. US-based AES Corporation acquired the 660 megawatt (MW) Masinloc plant in Zambales for $930 million through international competitive bidding. Financing for the acquisition came from equity investments and subordinated loans of $400 million from US-based AES Corporation and $35 million from the International Financing Corporation (IFC). The Asian Development Bank also extended a $200-million financing. The balance comes from the IFC and four local commercial banks. The Energy chief stressed that baseload plants are needed “so we can bring down the generating cost." Supply situation may worsen “Brownout tayo sa 2014," Almendras said if new power plants are not up and running within the next two years. He also said the power supply situation could even worsen if the country has another El Niño summer next year. According to DOE power statistics, the country sources 34 percent of its electricity from coal-fired plants. Only 11.5 percent comes from hydropower sources and about 15 percent from geothermal energy. Almendras explained why the country is unable to get the baseload power supply from liquefied natural gas or from hydroelectric power plants. “Wala pa tayong LNG terminal. Mas matagal magtayo ng hydro," he said. Almendras also said forthcoming decisions of the Energy Regulatory Commission on various charges that could affect the viability of some energy investments can also affect the country's power supply scenario in the coming years. — Earl Victor Rosero/VS, GMA News