Can emergency power save us?

The way I see it, a candle and a flashlight are just about the only emergency powers that can really help us if the shortages in power reserves next year translate into actual blackouts, rotating or otherwise. The only reason Energy Secretary Ikot Petilla is strongly urging emergency power for P-Noy is purely cosmetic… to make it appear government did something.

Reserve deficiency in the Luzon grid next year is expected to be in the range of 300 to 400 MW, or the size of a regular power plant. Epira prohibits government from putting up a power plant of that size or any size for that matter. So what will emergency power accomplish?

According to Petilla, he plans to buy modular generators to come to our rescue. Emergency power from Congress will allow P-Noy to buy these generators without public bidding and our problem is solved. Really?

It is a band aid solution if I ever saw one. But what’s the choice? No one can go to True Value and buy a 300 MW power plant off the shelf. It takes a minimum of three years and in our case with all the environmental and other clearances, five years to get a good sized power plant ready for hook up to the grid.

I understand these modular generators for 30 MW are available so we will need at least 10 of these to cover expected reserve deficiency. The power produced will be expensive because these will use diesel. But they can be fired up on short notice unlike Malaya.

How did we get into this situation? Regulatory capture just about sums it up. Government was just too intimidated to do anything.

And it isn’t just the power producers who are intimidating government into inaction. Environmental groups have also caused some big projects already started to stop, as is the case of that Meralco power plant in Subic.

The Aquino administration knew in 2010 that we don’t have enough power capacity to allow for reliable supply at reasonable rates. The Department of Energy knew, or at least they should have known, that unless the building of new capacity got started by 2011, blackouts are a strong possibility towards the tail end of their term.

For an administration that kept on talking about the bullish economic sentiment, thanks to P-Noy daw, they did nothing about power supply. Shades of Tita Cory!

Now we have new manufacturing locators who want an alternative to Thailand’s floods and political problems. Should they turn back because we have no power?

The emergency power given to FVR during his time made it easy for him to sign negotiated contracts for new power plants through Napocor. That FVR’s energy boys abused that power to cause us outrageous rates we can’t shrug off up to now, is another story. 

I get the feeling Petilla is just kicking the can down the road with his sissy emergency power request. If the emergency power Petilla wants for P-Noy is merely to buy those modular generators, wouldn’t it be easier to just have a law passed that would entice the private sector to take on this burden?

Tax free importation, for instance, and a promise of priority dispatch at so much per kwh sold to the Grid during the emergency period should make it attractive for private entrepreneurs to lease these modules from abroad.

The private power producers will likely protest. If they do, let it be their problem to fill up our power gap. Let them come up with solutions to address the problem. Put up or shut up, in other words. 

I know P-Noy is beyond corruption. He is after all the epitome of honesty and may even be the first living saint to be canonized soon. But letting government bureaucrats buy those generators with no public bidding under emergency powers is inviting the fallen angels to banquet in P-Noy’s heavenly palace. And guess who will pay the down to earth cost of corruption that will eventually show up in our power bills?

If P-Noy is to be given emergency powers at all, let it be to do big things… like overriding objections from all sorts of groups to the building of big power plants. Get the construction of that Subic plant re-started quickly.

The one thing that is being pushed into the sidelines as we focus on the supply shortage is the matter of price. Private power producers can be expected to take advantage of the tight supply by jacking up offered rates at WESM.

Is somebody looking into how a rate shock can be prevented? A power rate shock at this socially volatile time can be politically destabilizing.

The private power producers are saying there is nothing wrong with Epira and government should just implement it as envisioned. But will full implementation be enough at this point? I am starting to doubt that.

It is not good to see a government appearing helpless in the face of a national crisis in the making. If P-Noy wants to show how much of a macho leader he is, he can pick this power problem instead of the Supreme Court. He may yet come out a hero rather than the heel he seems to be now.

Does P-Noy know?

Sen. Serge Osmena made an interesting observation with reference to DAP that can also apply to other things including the mess at NAIA. This is what Serge said: “He doesn’t have a good feedback mechanism… he tends to have a cordon sanitaire who are afraid to tell him the truth.”

A reader e-mailed me his reaction to last Wednesday’s column on the NAIA 1 stink.

The husband of my cousin is a good friend of P-Noy given that they were schoolmates at ADMU. He told me that he was so disappointed with the state of NAIA after his recent trip that he took several pictures in his phone to show P-Noy. 

After showing him the pictures, P-Noy was very much surprised to see how poor the facilities still are, possibly because he never inspected the place himself. Or maybe because when he does, it is always VIP treatment with the red carpet rolled out for him. 

So my friend showed him pictures of how bad the facility is for people not afforded VIP treatment.  Upon seeing the pictures, P-Noy supposedly made a call to the NAIA manager to give him a good scolding.

I guess P-Noy is too busy to worry about pressing problems that he himself promised to fix. Worse yet, the people around him that he trusts so much tell him all is well in the Philippines and sadly he believes them. 

Who’s the boss now eh?  The Filipino people? Or the KKK?

Port operations

 Last Tuesday, PhilSTAR carried a story about the complaint of the president of the Aduana Business Club on slow port operations at the Port of Manila. Some 20 local and international cargo vessels are unable to dock at the POM because of lack of available berthing spaces. Ships have to wait in line to dock and unload cargo.

A ship able to get a berthing spot would take a long time to discharge containers because no space is available, and trucks are still loaded with empty containers. Sometimes trucks would be carrying these empty container vans for three days to more than a week, so how can they pick up the loaded containers out of the port?

Vessel operators are rejecting Philippine-bound cargoes. They no longer want to make a port call to the Philippines. Some no longer want to dock at the POM and the MICP… the vessels are avoiding Manila.

A reader who runs an export company in the Bataan export processing zone confirms the serious problems at POM.  “What I can not understand is why in 2013 the port ran fine and there was no empty container van problem. Was this build up of empty containers caused by the truck ban? 

“I have had inbound shipments from Taiwan laying at the port in Taiwan since 7/3. Every time they are scheduled to sail, it is postponed due to Manila port congestion.”

I hope the administration’s propagandists will not say the long lines of ships waiting to unload at POM show we have a robust economy, thanks to P-Noy. That’s how they initially explained the air traffic congestion at NAIA. What is happening at the Manila piers is a result of bureaucratic inability to make decisions.

Between Ricky Razon and the Romeros, the PPA is mesmerized into inaction. P-Noy should step in now and order the use of Subic and Batangas ports. It’s about time the massive investments in those ports start paying off. 

We have an emergency right now at the Manila port that will surely dampen economic growth and kill jobs.

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