Old renewables and coal are cool, they are complementary
and not contradictory
January 29, 2016
Bienvenido Oplas, Jr., Stratbase Albert del Rosario
Institute (ADRi) Fellow
Darkness and lack of electricity is inhuman. Having
expensive and unstable electricity supply when cheaper and stable power sources
are available is wrong and lousy. When many streets and roads are dark at night
because local governments or private subdivisions are economizing on their
monthly electricity bills and power supply is limited, there are two negative
social consequences: more vehicular accidents and more crimes. Criminals love
darkness where their victims cannot see or recognize them.
And when there is frequent power outages and brownouts,
there are two other negative social consequences: more fires when more people
use candles more frequently, or more noise and pollution as some people turn on
their generator sets that run on
expensive fuel, diesel.
These are crimes against humanity, the poor especially,
that the “limit/kill coal” movement does not take into serious consideration.
Among the cheap and stable energy sources that the
country should further take advantage of is coal. While many environmental
activists view coal as “enemy” of sustainable development, this is a misguided
view. In the Philippines, coal power plays a complementary and
non-contradictory role to renewables development. Here’s 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 percent of total power generation in the first half of 2015. The “old
renewables” hydro and geothermal contributed 12.5 percent while the “new
renewables” wind, solar and biomass contributed only 1.0 percent, very small.
In the Visayas grid, coal and geothermal provide the bulk
of power generation and in Mindanao, it is hydro, oil and coal.
The actual power generation of coal + natural gas of 84.4
percent are much larger than their power capacity of 61.2 percent 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, hydro (low
supply during dry months) and new renewables (unstable supply and expensive).
Two, in the Meralco generation cost, 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 natural gas power plants.
Table 1. Generation Charge (GC) of Meralco’s Power
Suppliers, Dec. 2014 vs. Dec. 2015, in P/kWh
Source: Meralco, “Computation of the Generation Charge”,
Three, compared to many developed and emerging Asian
economies, coal power consumption in the Philippines is actually small. And
while coal power consumption of the US, Russia, Germany and Poland have
declined compared to a decade ago, the amount remains big.
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 outright banning
of coal and use only renewables (old and new), is based on emotionalism and
alarmism.
For now at least, coal-powered plants are still the most
dependable sources of power generation. Given the country’s need for immediate
additional power generation to meet the demands a growing Philippines, the need
for coal-fired plants is still there.
With regard to developing renewables, however, the US
National Renewable Energy Laboratory (NREL) projects that the country has vast
potentials in three “new” renewables: wind, solar and biomass. Currently, the
“traditional” renewables dominate the renewable energy market: large hydropower
and geothermal energy.
There is a continuing debate in the country as to how
much the new renewables should be inputted in the energy mix. As shown in the
above table, while the cost of mostly coal and natural gas from different power
plants can be as low as P3.87/kWh, the guaranteed and fixed generation price of
solar and wind are P9.68 and P8.53/kWh respectively, or nearly 3x. This will
not help the country escape from the unhealthy label of having the “second most
expensive electricity in Asia next to Japan.”
So while a balanced energy mix of both renewable and
non-renewable sources of energy should be pursued, policy makers should keep in
mind these two important factors in determining the optimal mix: stability and
affordability of power for the consumers and businesses alike.
---------------See also:
Energy 51, More on solar power and supply instability, December 29, 2015
Energy 52, Renewables to "save the planet", Germany and UK cases, January 16, 2016
Energy 53, Expensive electricity + mandatory renewables, Philippine case, January 17, 2016
Energy 54, Need for cheaper, reliable energy sources, January 18, 2016
Business 360-33, Cheap energy now and in the future, January 28, 2016
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