25 March 2012

Power Situation Worsening

Senator Aquilino “Koko” Pimentel III, alarmed by the acute power shortage in Mindanao, Saturday called for “immediate government intervention,” warning that the worsening problem could lead to widespread disastrous consequences.
Pimentel also said the Senate must conduct a full-dress inquiry into the island-wide crisis amid energy officials’ conflicting reasons for the power outage.

“The situation has worsened. With the onset of summer, Mindanao is faced with the grim prospect of longer outages of up to eight hours a day. Business is suffering badly and the residents are becoming impatient over the government’s slow response,” said Pimentel.
He said that Cagayan de Oro City, where he hails from, has experienced recurring power outages.
Pimentel supported calls for the Napocor (National Power Corporation) and the DOE (Department of Energy) to explain in a full-dress Senate inquiry the main causes of the outages and why the government failed to anticipate the problem.
He said that although Mindanao’s power outages have been recurring, the lack of permanent measures by government energy planners to raise and stabilize supply has made it worse, driving away potential investors and affecting its improving tourism industry despite the island’s vast potentials.
The National Grid Corporation of the Philippines (NGCP), which has drawn heavy criticism for the acute power outages, has repeatedly blamed the shortage on the “lack of supply generated by power plants”.
But the Mindanao Development Authority (MinDA) has accused the NGCP of creating “an artificial power shortage”.
Former General Santos City Rep. Luwalhati Antonino, MDA chairman, aired the accusation, saying the NGCP wants the government to privatize the Agus-Pulangi hydro power plants that would supply half of the island’s power demand. The hydro power plants are due for major rehabilitation to generate additional capacity.
Pimentel said he would look deeply into the allegations of the MinDA chairman.
DOE officials, however, are singing a different tune. They said the acute power shortage could be traced to the electric cooperatives’ refusal to contract and purchase the necessary capacities in their areas, resulting in massive daily power interruptions across Mindanao.
Pimentel said the economic costs of the prolonged power outages are incalculable, badly affecting trade, commerce and investments in Mindanao as well as its tourism industry that is beginning to perk up with increased arrivals of both local and international guests.
The same power outages were experienced also in Luzon area in 1990 to 1992 during the administration of late former President Corazon C. Aquino, the president’s mother. The situation was contained when former President Fidel V. Ramos assumed presidency in 1992 when he allowed the so-called independent power producers (IPPs) to provide power for Luzon.
Pimentel said the power outages could also affect the delicate peace problem in Mindanao, where a long-running communist insurgency and a Muslim secessionist movement continue to create island-wide instability.
Power Barges Takeover
As Pimentel calls for government intervention, Bayan Muna party-list Rep. Teodoro “Teddy” Casiño proposed a government takeover of two privatized power barges to immediately address power shortage in Mindanao.
Casiño noted that power is sold at very expensive price in the Southern Philippines that may bankrupt distributors.
Casiño said power rates increased after the Power Sector Assets and Liabilities Management Corporation (PSALM) privatized the National Grid Corporation of the Philippines (NGCP), which allowed Therma Marine, Inc. to privatize power Power Barges 117 and 118.
Under an Ancillary Services Procurement Agreement (ASPA), Therma Marine would sell additional power to the Mindanao grid at a more expensive rate than when the power barges were still being used as base-load plants.
“Thus, a logical solution is for the government to take over the power barges of Therma Marine and add it to the grid as cheap base-load power instead of expensive ancillary power. Temporarily taking over of the power barges will lower prices allowing power distributors to buy cheaper power and supply it to customers,” Casiño said.
“Based on Article XII Section 17 of the Constitution, the government can temporarily take over or direct the operation of any privately-owned public utility or business affected with public interest, if there is a national emergency, when the public interest so requires,” he added.
Casiño had earlier proposed that the government provide incentives and financing facilities to encourage the use of solar energy by ordinary electricity consumers like residences, offices, and small to medium business establishments under his House Bill No. 5405.
Under the measure, One Million Solar Roofs Act, he hopes to harness solar resources of the country and providing for incentives for massive deployment of solar energy systems.
Mindanao’s power demand is expected to grow at an annual rate of 4.56 percent from 2011 to 2030. Demand is projected to exceed existing generation capacity by 2014 unless additional power generation capacity is installed. (With a report from Rio Rose Ribaya)




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