Friday, June 10, 2016

BWorld 63, Can renewables only power the PH and Asian markets?

* This is my article in BusinessWorld last June 08, 2016.

There is a belief that “renewables only” can supply all the power and electricity needs of the Philippines, or of the world. Because the sun shines everywhere, the wind can blow everywhere, there is biomass everywhere, there are rivers in many places and some countries are “blessed” with plenty of volcanoes and geothermal power is more available to them. Therefore, it is just a matter of “political will” to make this “renewables alone” to happen nationwide or worldwide.

This urban legend has spread and persisted for many years until today. Never mind that while there is indeed high contribution to electricity production by hydro in many countries, and geothermal for the Philippines and the US, the rest of renewables -- solar, wind, biomass, tidal power -- have contributed very little.

In 2015, of total electricity production in the Philippines, only 1% came from solar + wind + biomass combined. Their combined installed capacity has indeed expanded to around 3%-4% of total but their actual electricity generation was only 1% of total.

The “Asia Clean Energy Forum 2016,” which will be held from June 6-10 at the Asian Development Bank (ADB) headquarters in Ortigas, involve deep dive workshops and technical seminars on the first two days, and various policy discussions on the third and the fifth day.

Day 1 topics include among others, wind deployment in developing countries, green energy finance, carbon capture and storage, mini-grid lessons, Nordic models in renewables. Day 2 topics include integrating renewable energy (RE) into power systems, RE finance and PPP, powering Asian tigers with RE, and microgrid energy storage.

Then a renewables lobbyist and think tank, Center for Renewable Energy Strategies (CREST) produced a new paper, “The Energy Road Not Taken: How the Philippine Energy Plan can lead to a coal-free future within a few years.”

CREST paper cited some basic facts from the Department of Energy like baseline supply for 2016 is 16,244 MW (16.24 GW). The Philippine Energy Plan “business as usual” power demand of 10.9 GW in 2012 to rise to 23.2 GW in 2030. But with the introduction of the Philippine Energy Efficiency Project, the projected demand will be lower, only 19.56 GW by 2030 and the required supply will only be 21.63 GW by 2030.

Including regulating reserves, the projected derated additional power requirements will be 7.73 GW by 2030. CREST says this can be supplied by RE only -- but mostly hydro and geothermal, plus some wind power.

Is this scenario of “renewables only” for those 7.7 GW of power by 2030 possible for the Philippines?

Two tables below will help answer this question. Table 1 will compare energy density of various sources of electricity. Some definitions to better understand this table.

(1) Energy density -- the amount of energy stored in a given system or region of space per unit volume.

(2) Specific energy -- the amount of energy stored per unit mass (weight).

(3) 1 joule -- can produce one watt of power for one second, or one “watt second” (W·s).

(4) 1 kWh = 3.6 megajoules (MJ); or 1 MJ = 0.28 kWh

While diesel, gasoline, and coal can produce megajoules of power per liter, renewables like wind and solar can produce only a few joules, or fraction of joules, per cubic meter of space. Low energy density means low capacity to produce electricity per unit or volume of energy source.

The next table on levelized cost of electricity (LCOE) will corroborate the above statement. LCOE is a good measurement of the overall competiveness of different power generation technologies over an assumed financial life and duty cycle.

Capacity factor means the ratio of actual electricity output over rated or installed capacity (see Table 2).

So with (a) low capacity factor, (b) high capital cost, (c) high fixed operation and management (O&M) cost, and (d) high transmission cost, even if the cost of fuel (variable O&M) is zero, the renewables’ competitiveness is heavily reduced and compromised.

Note that latest and more advanced technologies in wind and solar from an advanced economy (US) are assumed to be employed here because these are power plants that are expected to become operational by 2020 or four years from now.

With those numbers on the comparative technologies of various energy sources, the answer to the statement “renewables only” can power the Philippines (or the world) by 2030 and beyond is a clear NO.

Malaysia with just 31 million people (less than 1/3 that of the Philippines) has electrical capacity of 32 GW in 2014 or 2x that of the Philippines for the same period, and is projected to double it to 64 GW by 2030, up to 85 GW by 2040, the bulk of which will be from coal and natural gas (source: SEA Energy Outlook 2015). But CREST and other campaigners of “limit energy demand unless coming from our renewables” would be happy to see a 21 GW Philippine capacity by 2030, or only 1/3 that of Malaysia’s then.

The Philippines still suffers from energy poverty with very low kWh per capita consumption per year compared to many of its ASEAN neighbors. The renewables lobby will not be able to produce convincing data and arguments that intermittent, weather-dependent, and subsidies-hungry renewables will be able to get out of their inherent weaknesses.

Governments including multilateral institutions like the World Bank and ADB should spare the people of the tyranny of expensive and unstable electricity. Climate alarmism as the main alibi for renewables favoritism and cronyism should confront the fact that climate change is natural and cyclical. That global warming and global cooling cycles did happen and will continue to happen even if we go back to the stone age lifestyle.

Bienvenido S. Oplas, Jr. is the President of Minimal Government Thinkers, and a Fellow of SEANET and Stratbase-ADRi.

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