Sunday, October 20, 2019

BWorld 372, Energy leftism will plunge the Philippines into darkness

* My column in BusinessWorld last September 26, 2019.

The continuing anti-coal paranoia of many leftist political groups and greenie environmentalists is largely based on emotion and alarmism, far away from reason and energy realism. And based on watermelon activism — green on the outside, red on the inside.

I constructed this table below to show why I said this. The data on coal consumption in million tons oil equivalent (mtoe) is from the BP Statistical Review of World Energy (June 2019), the data on population is from the IMF World Economic Outlook database (April 2019). Simply dividing coal consumption over population we can derive the kilos of oil equivalent (koe) per capita. (See Table 1).

Does the Philippines’ coal consumption of only 153 koe per person in 2018 appear to be “too scary, too Frankensteinin,” that the country should limit — if not stop building — new coal plants and phase out old coal plants? If it is too scary, then how would the watermelon activists call the coal consumption per capita of Australia, South Korea, Taiwan, and China which are nine times to 11 times larger than the Philippines’ — horribly Frankensteinly scary?

Aside from the mythical claim that the Philippines already has big coal power capacity, another dishonest claim by the paranoid anti-coal groups is that coal power will only produce more expensive prices as “stranded costs” that the consumers have to pay for decades. Far out.

The biggest private distribution utility in the country, Meralco, has successfully conducted a Competitive Selection Process (CSP) bidding and got contracts for 1,200 MW of baseload (power plants running 24/7) power with the following all-in prices, VAT inclusive: South Premiere Power for 670 MW, P4.93/kWh; San Miguel Energy for 330 MW, same P4.93/kWh, and PHINMA Energy 200 MW, P4.88/kWh.

Two things are notable about these future fixed generation prices: One, they are cheaper than recent generation charges by the company which were P5+ per kwh. (See Table 2) 

And two, coal prices would go up further in 2020 and beyond because of the higher excise tax on coal under the TRAIN law, from P10/ton to P50/ton in 2018, P100/ton in 2019, and P150/ton in 2020. And yet future prices of coal power for electricity will go down to below P5/kWh.

Another group of energy leftists rallied to oppose the 1,200-MW Atimonan One power plant because it is a coal plant. Going back to Table 1 as previously mentioned, we have very little coal power consumption despite having zero nuke power, little natgas power from the ageing Malampaya gas field, and ageing hydro, geothermal, and coal plants. If the lefties succeed in opposing new coal plants, we are courting a scenario of frequent blackouts in the coming years.

The anti-coal groups and activists can only mouth slogans and emotional statements, not facts-based research. They should not brag in their lousy and emotional campaigns, they should be ashamed instead because they are dragging the country towards darkness and frequent blackouts, of less power reserves but more political noise.

See also:

No comments: