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Sunday, April 07, 2024

Philstar 5, The Philippines' nuclear trade mission to Canada

The Philippines' nuclear trade mission to Canada
By Bienvenido Oplas Jr.  10 March 2024
https://www.pressreader.com/philippines/the-philippine-star/20240310/282003267391424 


Toronto – I am one of the participants in the Philippines “Nuclear Trade Mission to Canada” organized by the government of Canada through their embassy in Manila and with the support from the Philippine Embassy in Ottawa and Philippine Consulate in Toronto. The Philippine delegation was headed by Energy UnderSecretary Sharon Garin and Science UnderSecretary Leah Buendia. Other participants were from other agencies, domestic energy players and some are from the media, myself included. The local media joined only the Toronto leg from March 6-8.

My main interest is how expansion in electricity production including nuclear power generation would affect economic performance of countries as measured by their GDP growth. So I checked the excel files from the Energy Institute’s Statistical Review of World Energy 2023 for electricity generation, and the IMF World Economic Outlook 2023 database for GDP growth.

From 2018 to 2022, the average growth in power generation and GDP growth respectively of these Asian countries were as follows: Vietnam (6.3 and 5.7 percent), China (6.1 and 5.3 percent, Bangladesh (5.8 and 6.5 percent), Indonesia (5.6 and 3.4 percent), India (4.9 and 4.2 percent), Philippines (4.0 and 3.2 percent) and Malaysia (2.7 and 3.1 percent). 

Then Singapore (1.8 and 2.7 percent), South Korea (1.5 and 2.3 percent), Taiwan (1.3 and 3.6 percent), Thailand (0.5 and 0.9 percent) and Japan (-0.1 percent for both).

So there is clear correlation between fast growth in power generation and fast GDP growth, and vice versa. Of course there are many other factors affecting a country’s economic performance and electricity production is one of them but it seems to be a strong factor or determinant.

The average increase or increment in power generation expressed in terawatt-hours (1 TWH = 1 million MWH) from 2018 to 2022 were as follows: Vietnam 13.7 TWH/year, Malaysia 4.5 TWH/year, Philippines 4.0 TWH/year, Singapore 1.0 TWH/year, Thailand 0.7 TWH/year.

Now that the Philippines economy is growing fast, 5.6 percent in 2023 and targeted to grow by six percent to seven percent from 2024 to 2028, I believe our power generation should increase by six to seven TWH/year from 2024 to 2028, and eight to 10 TWH/year from 2029 onwards. If the increase in electricity production remains at four to five TWH/year, the target six to seven percent GDP growth will not be attained as there will be regular blackout.

Electricity generation growth from coal is now limited because new or “greenfield” coal plants have been prohibited since 2018, only “brownfield” coal plants on existing complexes are allowed. Power generation from natural gas (LNG) will increase but it will not be enough. And generation from intermittent wind-solar will definitely be insufficient because in 2022, their total generation was only 2.9 TWH and their annual increase is only about 0.4 TWH/year.

So the Philippines must learn to embrace nuclear power in the grid to avoid regular blackout in the coming years and avoid growth deceleration if not contraction. From our visit at McMaster University nuclear reactor right in the middle of the campus, then a visit inside the mock up reactor and bus tour outside Darlington nuclear plants owned by Ontario Power Generation (OPG), I am further convinced that nuclear energy is safe, stable, reliable and cheap. 

For instance, a 20-gram uranium pellet has the energy equivalent of 400 kilos of coal, or 410 liters of oil, or 350 cubic meters of natural gas. Twenty grams means 0.02 kilogram, or 1/23 of one pound. The current price of uranium is $94/pound or P5,264/pound or only around P229/pellet and it has the equivalent energy of 410 liters of oil already.

I asked three of the participants who started their nuclear energy meetings since March 4, I got these wonderful feedback and observations.

Energy Regulatory Commission (ERC) Chairperson Monalisa Dimalanta said, “I had a good discussion with the Chief Commissioner of the Ontario Energy Board on the challenges regulators face with the evolving energy systems. Interesting to learn how the inclusion of nuclear power in Ontario’s supply mix has become critical in enabling the province to address the issue of energy affordability. The adoption of digital solutions - changing the way we do our work as regulators - is central to the timely and efficient delivery of public service.”

Meralco first vice president and head of Networks Froilan Savet said, 

“Assuming that the relevant policies and regulatory framework are already in place, and with infrastructure challenges/issues already resolved, I see a significant opportunity for adopting Small Modular Reactors (SMRs) and Micro Modular Reactors (MMRs). These technologies promise enhanced safety, scalability, and flexibility, making them ideal for both grid-connected and remote applications. The deployment of MMRs is particularly promising, offering cost-effective integration into medium-voltage distribution system and ensuring reliable power.”

Aboitiz Power Corporation head of Energy Transition Projects Felino Bernardo observed that “A nuclear energy program should be depoliticized and be governed by clear and consistent regulatory policies that holistically understands the ins and outs of the technology and its market. This is about comprehending the life of a nuclear power plant, with its high upfront costs but low operating costs, as well as its sensitivity to interest rates and delays. Plus  the logistics and maintenance of safety…. We hope to replicate the success of Ontario, which has one of the world’s cleanest grids that generates low-cost electricity thanks in large part to the dominance of nuclear energy in its power mix at 60%. Through our friends in Bruce Power, we are now more aware of the deliberate and careful planning at each development stage that precedes such success. This includes early stakeholder engagement, the identification of risks and mitigations, and the establishment of an environment of transparency.”

Great points, madame chair and gentlemen. You completed my economic understanding of nuclear energy with your engineering and regulatory perspectives.

I thank the Canada government for organizing that wonderful and educational tour, site visits and meetings with many Canada government officials, corporate and academic leaders. And I am hopeful that Philippine government energy, science and regulatory officials, companies like Meralco and Aboitiz Power, are now more inspired to develop nuclear energy in the future – for  our country’s modernization and prosperity.


Bienvenido Oplas Jr. is a free market advocate and columnist of BusinessWorld. For comments email at minimalgovernment@gmail.com
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See also: 
PhilStar 3, On endless wars, endless welfare and public debt, October 18, 2023
PhilStar 4, What to expect from Sec. Ralph Recto leadership at DOF, January 16, 2024

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