Our energy future

There had been recent talk about the possibility of finally putting the Bataan Nuclear Power Plant to good use. It took an Energy secretary who has no technical background on energy to have the guts to officially bring up that possibility.

I have no problem with nuclear energy. I have worked on the project during my time at the then Ministry of Energy. I think there is too much unfounded fear about it. That, plus the politics of the Marcos plunder made us junk the Bataan plant.

The sister plants of Bataan in South Korea have been running over the last 30 years with no problems. The containment building is world class and built to withstand a strong earthquake and even a 747 crashing directly into it.

Having said all that, the decision to finally put Bataan on line isn’t going to be simple. First of all, we have to upgrade a lot of the technical elements in the plant. Instrumentation will have to be brought up to speed with the digital age. Other parts of the plant will need to be inspected and overhauled.

Secondly, the cost of upgrades will have to be compared with the cost of building an alternative power plant. Kepco once estimated the cost in the region of a billion dollars. That will be more than the original cost of the Bataan plant, less the Marcos kickbacks. There should be other more cost effective options to get 620 MW of power.

Thirdly, a nuclear plant is designed to work in a centralized grid like what we have now. But new technology is threatening to make the central power grid as we know it rather obsolete.

Leandro Leviste, the pioneering son of Sen. Loren Legarda, has been saying the cost of solar power is now at grid parity and can compete with coal. There are those who say Leviste is dreaming, but the young man is putting money where his mouth is and is ready to put up solar power installations without the feed-in tariff subsidy.

Even officials of First Gas, a major power producer, recently recognized “the rapid, almost exponential advances in renewable energy and storage technology that are bringing costs closer to fossil-fuel based energy.” It noted that “over the last five years, the cost of solar electricity has plummeted almost 80 percent and that of wind by 50 percent.

“These rapid reductions in cost today are being driven by what’s going on in China. As of 2015, China had more than 43,530 MW of PV solar installed (roughly 20 percent of global capacity), with 15,150 MW of that capacity installed just in that year.

“Their stated goal in 2014 was to have more than 100,000 MW in place by 2020. This target was revised just a year later in 2015, to 150,000 MW because they now have more confidence it can be achieved. These quantum are driving economies of scale and pushing them rapidly along the experience curve to the benefit of solar electricity consumers worldwide.”

In fact, just last May, a watershed event in the energy world happened quite inauspiciously in Dubai when, at an open tender of DEWA (Dubai Electricity and Water Authority) for 800 MW of solar capacity, the winning bid came in at $0.03/kwh. The bidding results were so close that the next best bidders came in at $0.0369, $0.0396, $0.0444, and $0.0448.

The results surpassed a previous 200 MW Solar PV award of DEWA just 18 months earlier of $0.0565, and even that of their coal-fired plant bidding in Oct. 2015 of $0.0451. Solar PV, with the right conditions, is already beating coal-fired power in some parts of the world. In other Middle East countries like Oman, solar energy is already used to pump up oil from their fields, replacing natural gas.

It isn’t only the growing competitiveness of renewable energy that energy planners must recognize. In a National Electricity Forum in 2012, US Energy Secretary Steven Chu, a Nobel Prize winning physicist, commented, “If someone invents a cheap, efficient form of storage, it will be a game changer.”

I was just reading an article about a yet unnamed technology that “will reside in a box that sits adjacent to every home. A series of boxes can also replace a local substation. Power can be generated for less than 2 cents per kwh. Each unit can produce three times the power needed for the average home, and whatever power is unused can be efficiently stored from one day to the next.”

A startup in Denver founded by a physicist with a strong entrepreneurial background is developing such a game changer in the form of a thermoelectric generator. His secret ingredient is an unusual nano-fluid that causes the system to operate with great efficiencies when there is only a minor temperature differential, even at night.

Assuming this invention pans out, it will indeed be a game changer. Even if it doesn’t, technology seems to be headed in that direction of off grid power, such as solar on rooftops. Over time the national electric grid will be converted to a series of micro grids.

Indeed, as Piki Lopez of First Gas pointed out, “a new energy paradigm is unfolding fast because consumers are responding to the needs of the planet and technology is rapidly improving the economics of new off grid power.

“The Philippines has a golden opportunity to leapfrog into this new paradigm and build an energy infrastructure that’s future-ready. To do this it’s critical that we craft a credible glide path that keeps power reliable, available, and affordable.”

Another fact worth pointing out, according to Piki, is that Philippine growth has been services driven. The power supply that supports such growth requires more flexible power technologies that are also capable of serving mid-merit and peaking type of demand.

“This will become even more critical as solar PV costs continue their inevitable descent. Today, given our electricity prices here, it already makes economic sense to install solar PV and even solar water heaters on rooftops.

“Many here have not woken up to this yet but they will, as PV costs come down even further and, believe me when it does, it will feel like a dam bursting. Whether they be grid-connected or not (the so called behind-the-meter), they will have the effect of muting power demand growth and will change the shape of demand on a daily basis and even on a seasonal yearly basis.

“As more renewables come online, we will need battery storage capacity to come along with it to produce power when the sun doesn’t shine at night, on cloudy days, or when the wind isn’t blowing. Costs of battery storage are still high but likewise coming down fast.”

Let us also not forget that the Philippines is home to clean, renewable energy today can already run 24/7 and meet baseload, mid-merit, and even peaking requirements of the grid. There’s more than 2,000 MW of geothermal potential still untapped in our country.

Our geothermal resources can be developed with even lower feed-in tariff than were granted to all the other Renewable Energy technologies. We are now taking geothermal for granted and letting so much of it sit there unutilized because of current policies.

As more solar and other renewables are added to the grid, those inflexible coal plants will be used less and less, or they may be kept idling, burning coal even if not needed because these power plants cannot be turned on and off to respond to variations of demand in a day.

The usefulness of coal plants will not disappear overnight. But we seem to be planning for too much already, creating the prospect of stranded investments that will bring up our electricity bills. We should instead be planning for a rapidly diminishing role of coal and, eventually, even natural gas-fired plants in our grid.

As for nuclear energy, keeping Bataan mothballed is probably our only real option, not because it cannot be safely run but because it is too costly in economic and political terms to turn it on.

Boo Chanco’s e-mail address is [email protected]. Follow him on Twitter @boochanco.