PhilStar 53, Coal power plants and inflation control

Coal power plants and inflation control

ENERGY, INFRA AND ECONOMICS - Bienvenido Oplas Jr. - The Philippine Star 

August 7, 2025 | 12:00am

https://www.philstar.com/business/2025/08/07/2463585/coal-power-plants-and-inflation-control

 

Last week, there was one irresponsible report that came out saying that Department of Energy (DOE) Secretary Sharon Garin has overridden the Department of Environment and Natural Resources (DENR) by granting an exemption on new coal plants to a Meralco Power Gen (MGen) project, the Atimonan One Energy (A1E).

 

This is fake news for two reasons. One, DENR has nothing to do with issuance of permits or moratorium to power plants, DENR only issues environmental clearance certificate (ECC) to proposed energy projects, among others.  Two, A1E is not a new or “greenfield” coal project, it is an old project that has ECC from DENR several years ago.

 

I saw the MGen statement on this, short and direct. They said that “Secretary Sharon Garin has reaffirmed the A1E project’s status as a committed project, consistent with the DOE’s earlier position that the project is not covered by the 2020 Coal Moratorium Policy. We assure our stakeholders and partners that the A1E project remains fully compliant with all applicable environmental laws, rules, and regulations. Aligned with the country’s efforts to ensure energy security and affordability.”

 

Reports like the above are part of the continuing anti-coal campaign and climate alarmism drama worldwide, including the Philippines.

 

In 2024, our coal power generation was only 79.4 terawatt-hours (TWH). In contrast, coal generation of other countries were much larger: 98 TWH by Malaysia, 113 TWH by Taiwan, 127 TWH by Australia, 153 TWH by Vietnam, 188 TWH by S. Korea, 228 TWH by Indonesia, 301 TWH by Japan, 712 TWH by the US, 1,518 TWH by India and 5,828 TWH by China.

 

Or our coal generation full year in 2024 was equivalent to only five days coal generation of China, about four months of Japan’s and nearly half-year of Vietnam’s.

 

Countries that experienced fast average growth of at least four percent yearly over the last decade, 2014-2024, are those that have high coal expansion of 4-162 TWH per year: Philippines, Malaysia, Vietnam, Indonesia, India and China. We need to this energy and growth momentum to keep creating more jobs for our people.

 

Yesterday, I attended the media briefing by the Independent Electricity Market Operator of the Philippines (IEMOP). I checked the energy mix for July 2025 billing and compared it with first quarter (Q1) January-March and Q2 April-June 2025 average energy mix.

 

The share of coal to total power generation has fluctuated from 55 percent in Q1 to 59 percent in Q2 and 54 percent in July. The share of gas has increased from 17.7 percent in both Q1 and Q2 to 21 percent in July. The share of geothermal is generally flat at 8.4 percent, hydro also fluctuated from 10 percent in Q1 to 7.6 percent in Q2 and 10.5 percent in July.

 

The share of intermittent wind + solar combined declined from 5.8 percent in Q1 to 4.9 percent in Q2 and four percent in July. Pumped hydro and battery share is flat at 1.2 percent.

 

This is despite the fact that coal is only 41 percent of total installed capacity, solar at 9.6 percent  and wind at two percent of total capacity, data as of end-July 2025.

 

Last Tuesday, the Philippine Statistics Authority released the July 2025 inflation data, only 0.9 percent and nearly a six-year low. Coal providing 54 percent and gas giving another 21 percent, both account for 75 percent of total power generation and prices at the Wholesale Electricity Spot Market (WESM) remained low at P4/Kwh from May-June-July period. Which contributed to declining inflation of 0.9 to 1.4 percent over those three months.

 

We need more conventional energy sources like coal to stabilize power supply, continue energizing our rising industry/manufacturing and services sectors, and keep overall consumer prices stable.

 

Visayas grid has experienced “yellow alert” from Friday to Tuesday this week except last weekend, usually at 6-8 p.m. where electricity demand is high, lights are on in houses, shops and streets while solar output is zero on those hours. Again, solar that constitutes nearly 10 percent of our total installed capacity is producing zero at night and little during cloudy-rainy days like the two-week habagat just a week ago.

 

MGen has small expansion plan for their coal plants in Iloilo and Cebu while Aboitiz Power also has coal expansion plan in their Cebu plant. These are all “brownfield” projects, meaning expansion of existing coal plants with valid ECC from DENR. Those additional  capacity should come online fast, help save the Visayas grid especially the Cebu, Negros and Panay islands and sub-grids from the threat of blackout.

 

The economic team keeps inviting foreign investments, encouraging existing ones to expand. But if those investors see that the yellow alert, even red alert keep coming every year, a number of them will not come or expand. Energy limitation has become economic limitation. Energy policies translate to economic and investment policies.