Mindanao suffers P2.3-billion losses due to brownouts

May 25, 2014



The power shortage in Mindanao has caused billion in losses to the Gross Regional Domestic Product of the island in the last 74 days.


During an energy forum held in Davao City recently, the Mindanao Development Authority (MinDA) reported that a rapid assessment conducted by the agency disclosed estimated economic losses of P2.3-billion due to rotating brownouts from Feb. 28-May 12 this year.


Former Oro Chamber Pres. Ma. Teresa R. Alegrio relays to the Cagayan de Oro City Council Energy Committee chaired by Kag. Bong Lao May 23 at the SP Session Hall the results of a power forum held in Davao by the Mindanao Development Authority (MinDA). (photo by Mike Banos, NPN)


“This is a very conservative estimate that does not even factor in opportunity losses,” said Ma. Teresa R. Alegrio, former president of the Cagayan de Oro Chamber of Commerce and Industry Foundation, Inc. (Oro Chamber) during a May 23 meeting called by the Cagayan de Oro City Council Committee on Energy chaired by Kag. Teodulfo Lao, Jr. to discuss the power situation.


Ms. Alegrio said the figure includes cancelled consumption and equipment breakdown in some of the industries.


“NGCP just informs their customers 15-30 minutes before cut-off,” she said. “When you’re running to reduce your load with that kind of time you will have breakdown of equipment. This is the problem now confronting most industries who are forced to buy gensets or otherwise face shutdown or closure.”


Although acknowledging committed power projects are now online, many small scale businesses cannot wait for March 2016 when they start coming online.


“It’s important the problem be addressed immediately. The problem is who is in charge of the power crisis? We don’t know who is accountable and responsible,” Ms. Alegrio said. “This was the same scenario in 2010. And our new capacities are only good for three years. After that we will again have shortage especially during the dry season. We have to look at long term solutions to this problem.”


During the stakeholders forum in Davao, the PSALM/NPC reported that as of May 20 the water level of Lake Lanao stood at 699.51 meters, barely 36 centimeters (cms) above the critical level of 699.15 meters when the hydro plants would have to be shutdown.


Ms. Alegrio said most of the hydro plants in the Agus complex are derated or producing their installed capacity mainly because of old age since many were built during the 1960s and 70s.


The Ma. Cristina Plant (Agus 6) with an installed capacity of 200 megawatts (MW) is producing less than 100MW with many other hydro units not operational because of the lack of spare parts.


“Government is not keen on spending for plants slated for privatization. Although the privatization of the Agus-Pulangi complex has been deferred, PSALM remains cautious.


The NGCP has forecast a peak demand of 1,400MW for this year but the island’s power plants can only produce a peak supply of 1,200 MW, Ms. Alegrio noted.


PSALM recently awarded to ITP Construction a P438-million contract to replace a unit of the Agus 6 plant which consists of two units with combined capacity of 50 MW and three units with total capacity of 150 MW. Last December, PSALM also awarded a P1.59-billion contract to rehabilitate two units of the Agus 6 to a consortium of ITP and China-based Guangxi Hydroelectric Construction Bureau. Rehabilitation works have been set to start this October and completed by the second quarter of 2016.

The project aims to increase the output of the first and second units of the Agus 6 from 25 MW to 34.5 MW each.


Modular Genset

Meantime, none of the government’s ballyhooed modular gensets acquired by electric cooperatives are yet operational due to pending approval of the units power rates at the Energy Regulatory Commission (ERC), Ms. Alegrio reported.


A May 5, 2014 report compiled by the Association of Mindanao Rural Electric Cooperatives (AMRECO) shows that seven cooperatives are acquiring modular gensets totaling 48MW, another six coops are considering acquiring them (total capacity: 20MW) while another three have acquired them privately (total capacity: 42MW) but have been unable to start operations to date due to the rate applications still pending with the ERC.


Meantime, the planned P24-billion Visayas-Mindanao interconnection project has been moved further to 2020 since initial findings show the Surigao del Norte interconnection point to be not feasible due to the 10 kilometer depth of the seabed. The NGCP is initiating another study to investigate alternative sites.


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