NO DANGER OF POWER SHORTAGE IN LUZON UNTIL 2010 - DOE

MANILA, February 8, 2006
 (STAR) By Donnabelle L. Gatdula - The Department of Energy (DOE) has reiterated that Luzon will have enough power capacity up to end 2010.

At present, the DOE said Luzon has an installed generating capacity of 12,076 megawatts (MW) with dependable generating capacity of 10,395 MW.

With 10,395 MW of dependable capacity and a projected peak demand of 6,479 MW this year, new power plants will be needed in the Luzon grid at the earliest in 2010. The scheduled decommissioning of old power plants have already been considered.

The DOE said the Luzon grid has on average gross reserve margins of about 3,900 MW. In fact, the recorded peak demand in Luzon grid for the third week of January 2006 was still below the projected peak demand this year.

The move to reflect the true cost of electricity provision, the continued upsurge in oil prices, and the aggressive promotion of energy conservation will have a downward impact on the country’s electricity demand. This means that the country’s reserve capacity margins may even increase and thus avert a possible power crisis foreseen.

The critical period in Luzon is 2010. There will be a need for a peaking plant in year 2010 and a mid-range power plant in 2011 that will require about $1.4 billion in new investments.

The DOE expects the Luzon grid to grow at an annual average of 4.3 percent. But capacity additions may be further deferred if consumers will respond to the government’s efforts to promote demand side management, particularly on the implementation of time-of-use rates, not only in the generation level but also in the distribution level.

"We have already identified potential capacity additions that merchant power producers may implement after 2010," the DOE said.

These include possible projects such as the 40 MW North Luzon Phase II wind project in 2009, 40-MW Tarlac bionergy in 2008, 1000-500-MW Bataan LNG power plant in 2011- 2012, 600-MW Bataan greenfield power plant in 2010-2012, 500-MW Limay conversion in 2010, 600-MW Ilijan expansion in 2009, 550-MW San Gabriel power plant in 2009, 350-MW Pagbilao coal III in 2010, 40-MW Manito-Kayabong geothermal project in 2010, 40-MW Tanawon project in 2009, 600-MW Malaya conversion in 2012 and the 450-850-MW Sucat conversion in 2012.

Meanwhile, demand in the Visayas and Mindanao are expected to grow relatively faster at 6.2 percent and 6.5 percent, respectively, thus critical years will start in 2008 and 2006, respectively.

Programs to address Mindanao’s current and future capacity deficiencies include an optimal combination of capacity additions, the ongoing strengthening of transmission systems in the islands, the transfer to the island of several power barges and the commissioning of the 210-MW Mindanao coal by end-December 2006.


Chief News Editor: Sol Jose Vanzi

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