In many literatures on energy and environment,
electricity and climate policies, the dominant view is that fossil fuels in
general, and coal power in particular, are the “enemies” of sustainable
development. This should not be the case. The truth is that coal power plays a
complementary and not contradictory role to development. Three sets of data
will show why.
One, without coal and natural gas, the Philippines will
be as dark at night as North Korea and other underdeveloped countries
experiencing daily “Earth hours.”
In Luzon grid, coal + natural gas + oil have produced
86.6% of total power generation in the first half of 2015. The “old renewables”
hydro and geothermal contributed 12.5% while the “new renewables” wind, solar
and biomass contributed only 1.0%, very small.
In the Visayas grid, coal and geothermal provide the bulk
of power generation and in Mindanao, it is hydro, oil, and coal.
Note that the actual power generation of coal + natural
gas of 84.4% are much larger than their power capacity of 61.2% of total
dependable capacity in the Luzon grid. This means that power plants that use
these two fuel types are producing more electricity at stable supply and
cheaper prices than other power plants that use oil and geothermal (stable
supply but expensive), hydro (low supply during dry months) and new renewables
(unstable supply and expensive). Hence, more power are used and purchased from
coal and natural gas plants.
Two, in the Meralco franchise area covering Metro Manila
and nearby provinces, power plants that run on coal (TLI, MPPC, and SCPC)
provide cheaper electricity, although power plants that run on natural gas
(SPPC-Ilijan, FGPC-Sta. Rita and FGPC-San Lorenzo) provide the bulk of power
generation. Exception is QPPLC that also run on coal but the price is
comparable to nat gas power plants.
TMO is a peaking plant, meaning it runs only during peak
hours of electricity use. Its price is higher because it uses more expensive
fuel, diesel, and runs only for one, two or four hours a day, depending on the
season or months of the year. Thus, its contribution to total power production
is small, only 0.6% in December 2015.
Three, compared to many developed and emerging Asian
economies, coal power consumption in the Philippines is actually small. The
expansion of coal consumption in Malaysia, Indonesia and Vietnam from 2000 to
2014 was nearly twice the expansion in the Philippines.
During the recent Energy Policy and Development Program
Conference where Energy Secretary Monsada presented at the final plenary, this
writer commented during the open forum that the DoE’s target of 30% minimum
share of renewables can be a trap and reduce the country’s flexibility to tap
cheaper, more stable energy sources like coal.
Such flexibility is necessary in order to (1) address
energy poverty (low kWh/capita electricity consumption), and (2) bring down
Philippine electricity prices and leave that unhealthy label of having the
“second most expensive electricity in Asia next to Japan.”
The claim therefore by some sectors and observers that
coal power is the enemy of sustainable growth of the Philippines is based on
subjective and non-objective point of view. Their proposal to either (1) limit
coal to base load power only, or (2) outright banning of coal and use only
renewables (old and new), is based on emotionalism and alarmism.
When many streets and houses are dark at night because
local governments and households are saving on their monthly electricity bills,
there are at least three negative social consequences: more vehicular
accidents, more criminal activity, and more fires when more people use candles
more frequently.
These are crimes against humanity and the poor especially
that the “limit/kill coal” movement does not take into serious consideration.
Adding more renewables to the energy mix is good and
healthy for the economy so long as no subsidies are provided like feed in
tariff (FIT) and no “must/priority dispatch” policy via the renewable portfolio
standards (RPS).
The government must avoid politicizing the pricing and
dispatch of electricity. Instead, it must encourage the entry of more power
plants using different types of fuel, whether local or foreign. More
competition among more players is the best way to protect the public via stable
supply and cheaper, affordable electricity prices.
Bienvenido Oplas,
Jr. is the head of Minimal Government Thinkers, and a Fellow of both the South
East Asia Network for Development (SEANET) and the Stratbase-Albert del Rosario
Institute (ADRi).
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See also:
BWorld 35, Inter-island shipping and the PPA, Coast Guard, December 25, 2015
BWorld 37, World rule of law index and the Philippines, January 11, 2016
BWorld 38, Climate change and the need for cheap energy, January 14, 2016
Energy 54, Need for cheaper, reliable energy sources, January 18, 2016
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