Aquino administration urged to tackle energy supply

MANILA, Philippines - Aside from a looming power rate hike, the Aquino administration will also be facing the challenge of keeping the country’s energy supply stable.

At a Power Outlook Forum yesterday, Alan Ortiz, former president and chief executive of National Transmission Corp. (TransCo) and now an independent energy consultant, said if not properly addressed, the rotating brownouts in Luzon will worsen next year.

“Luzon will be faced with power supply-demand imbalance next year, resulting in intermittent brownouts until new supply comes in by 2012,” Ortiz said.

Luzon, under the Philippine Energy Plan (2009-2030) is entering a critical period next year as the existing generating capacity in the grid will not be able to meet the peak demand and the required reserve margin which is 23.4 percent above the peak demand for Luzon.

In a separate interview, outgoing Energy Secretary Jose Ibazeta said power shortage will set in early next year or 2012 if no new capacities are added to the system.

“Maybe the new Energy Secretary could look at the power supply situation,” Ibazeta said.

In Mindanao, Ortiz noted that the supply problem will get worse in the near term. It would be noted that Mindanao had been suffering from power shortages as it is heavily dependent on a major source of power, hydroelectric.

“Mindanao will continue to suffer shortfalls in power supply in the next three years until new capacity is brought onstream through private sector investment,” Ortiz said.

But Ortiz recognized the entry of new capacities in Visayas which may help in easing up the power supply burden in the region.

“Visayas will have a “brief respite” next year when 400 megawatts of new electricity become commercially available,” he added.

Metrobank’s Global Business Power Corp. is in the process of completing its coal facilities this year that would add to the power generation capacity in the Visayas.

“The real challenge is to build new capacity in the next five years to address surging demand. The situation is not hopeless if we act immediately to close the supply gap,” Ortiz said.

According to Ortiz, all government has to do is to lure investors to pour in much-needed capital.

He noted that the private sector can provide the much-needed financing for about 8,000 MW of additional capacity in Luzon alone.