Despite assurance from Energy Secretary Carlos Jericho L. Petilla of capacity additions when supply conditions hit straining point in 2015, a list of the Department of Energy (DOE) revealed that there are actually only two committed power projects in the Luzon grid.
These are the coal-fired plants of South Luzon Thermal Energy Corporation (SLTEC) of Trans-Asia and Ayala group joint venture; and that of Southwest Luzon Power Generation Corporation of the Consunji group.
The initial 135-MW of the Putting Bato coal-fired facility of SLTEC is targeted on stream August this year, according to the energy department; while the 300-MW of the expanded Consunji coal plant in Calaca, Batangas is for commissioning around November this year for Unit 1 of 150MW; and the second unit of another 150MW by February 2015.
The Phinma Group-Ayala joint venture has programmed to expand the capacity of their coal plant by another 135MW and this is targeted on-line by 2015.
What has been teeming in the DOE’s list are “indicative power projects”, but these may not necessarily reach commercial development either due to major issues such as financing, political risks or hurdles on off-take agreements.
The roll of committed power projects for the Visayas grid has also been dismal, with only the 270-MW of Palm Thermal Consolidated Holdings Corporation taking off from blueprint to-date. The facility is due for commissioning in 2015.
Based on DOE’s forecast, Luzon and Visayas grids will be afflicted with supply tightening around 2015. If power projects cannot be firmed up on time, these two power grids faces prospects of brownouts.
For Mindanao, the only committed project logged by the energy department is the 300-MW Therma South Inc. coal plant of the Aboitiz group. It will shore up the grid’s power supply starting 2015.
There are other Mindanao power facilities which project developers guaranteed to be on-line by 2015 and 2016, but these are not included yet in the DOE’s “committed projects’ list”. These include the 210-MW Sarangani coal-fired plant of the Alcantara group and the 405-MW plant of FDC Utilities Inc. of the Filinvest group.
Power industry players have been seeking concrete policy directions as well as updated and sensible energy blueprint that shall guide them in their investment plans.
And while the DOE leadership sounded off expectations that power plant projects will come on-line as they are needed, what it missed in such assumption had been the lingering policy uncertainties which may discourage capital flows in the sector in the near term. (MMV)
Reference:
Velasco, M.M.(2014 February 6). Committed Power Projects Still Inadequate To Meet Future Demand. ManilaBulletin. Retrieved from http://www.mb.com.ph/committed-power-projects-still-inadequate-to-meet-future-demand/
2014/02/05
Meralco says power rates down this month
Meralco says power rates down this month
February 3, 2014 10:11 pmManila Times (online version)
POWER consumers will see a drop of 13 centavos per kilowatt-hour in their February bill because of lower generation charges, according to the Manila Electric Co. (Meralco).
The country’s biggest power distributor said the generation charge was smaller because the power supply has stabilized. For February, the generation charge will be P5.54 kilowatt per hour (kWh), 13 centavos lower than January’s P5.67.
Meralco said the cost of power sourced from the Wholesale Electricity Spot Market (WESM) went down to P30.67 per kWh from P36.08 per kWh in December.
“This reduction in the generation charge, particularly in the cost of power from WESM, was expected as power supply normalized during the January supply month, with most of the baseload power plants that were previously out of service returning to normal operations and with gas-fired plants no longer using the more costly liquid fuel, such as condensate and bio-diesel,” the power distributor explained.
“Sa pagbabalik-normal ng suplay ng kuryente, bumaba sa P5.54/kWh ang generation charge ngayong buwan,” Meralco said on Twitter.
The surge in the generation charge prompted Meralco to seek a record rate hike late last year. The company blamed the higher rates to the shutdown of the Malampaya plant and other power plants. Luzon gets the bulk of its power from Malampaya.
The Supreme Court stopped the implementation of the P4.15 per kilowatt-hour rate increase in December.
2014/01/28
Who screwed the power consumers?
Who screwed the power consumers?
DEMAND AND SUPPLY By Boo Chanco (The Philippine Star) | Updated January 27, 2014 - 12:00am
If you followed the Senate hearing on what went wrong with our power bills, a typical consumer will likely end up more confused than ever. The various parties invited to shed light ended up pointing to each other as being primarily responsible for screwing us, the power consumers.
The problem with that hearing is that it was mostly the lawyers talking and we all know lawyers aren’t as interested in unearthing the truth as they are with protecting their principals. They will obfuscate the issues and because of the technical complexities of the power industry, it is easy to obfuscate.
There was also failure to ask more tough questions. I am however glad that enough was said to confirm most of the points I have raised in this column. But the smoking gun was nowhere in sight.
Indeed, the issue of collusion was all but forgotten. I feel the way to get to the truth of who was responsible for that catastrophic rise in our power bills is to follow the money. By this I mean look into the records of WESM to see who gave a maximum bid of P62/kwh and actually got dispatched.
Some executives of generating companies were reportedly popping champagne bottles and computing their expected outsized bonuses because of the extraordinary profits from that national tragedy. But some of them are saying they were not the only ones who earned a bonanza. They tell me we should also focus on possible “trading profits” of Meralco.
Let us try to follow the money. Based on records, here is the list of generators who submitted bids in the 60s level during the time in question. Their bids were dispatched, thus setting the clearing price.
In sum, there were 23 out of 744 intervals (hours) in November and 68 out of 720 intervals in December that cleared at approximately P60/kwh during the time that the Malampaya platform was being maintained including at non peak hours.
For the November billing period (Oct. 26 to Nov. 25), these were the days and plants that offered >60 P/kWh.
November 10: 1590 (Bauang), Pan Asia (Limay)
November 15: 1590 (Bauang), Therma Mobile (Navotas)
November 16: 1590 (Bauang),Therma Mobile(Navotas)
November 17: 1590 (Bauang), Therma Mobile(Navotas)
November 20: 1590 (Bauang), Therma Mobile(Navotas)
November 23: 1590 (Bauang), Therma Mobile(Navotas)
November 25: 1590 (Bauang), Therma Mobile(Navotas)
For the December billing period (November 26 to Dec. 25), these were the days and plants that offered >60 P/kWh.
November 26: Pan Asia (Limay), APRI (Makban)
November 27: Pan Asia (Limay),
November 30: Therma Mobile(Navotas)
December 1: Therma Mobile(Navotas)
December 2: Pan Asia (Limay),
December 3: Pan Asia (Limay),
December 5: 1590 (Bauang), Pan Asia (Limay),
December 6: 1590 (Bauang), Therma Mobile (Navotas), Pan Asia (Limay),
December 7: Therma Mobile(Navotas)
December 8: 1590 (Bauang), Therma Mobile(Navotas),
December 11: 1590 (Bauang), Therma Mobile(Navotas),
December 12: Therma Mobile(Navotas).
These are all diesel powered plants except for APRI (Makban) an Aboitiz geothermal plant. The 1590 Bauang plant is owned by a company called Vivant, a company that also owns VECO. The Limay plant used to be owned by San Miguel who supposedly divested it to another company which many in the industry believe is still related to San Miguel. Therma Mobile belongs to Aboitiz Power and fully contracted to Meralco which in effect makes it a Meralco plant.
It should be interesting to know how much these companies earned during the Malampaya shutdown emergency. Checking the details of the records can help tell us the presence of collusion.
On the other hand, we can also point out the appearances of collusion by analyzing the bidding behavior. We start with the fact that all the generating companies know Malaya is hardly dispatched. Thus, in making their bid calculations, they assume Malaya is out of the picture.
Did they can see the thin reserve and agreed with each other to all submit bids on the high side… up to the limit of P62/kwh? Or did they give their bids as independent rational decisions based on market conditions?
The NGCP as system administrator, on the other hand, sees all the available generating plants including the diesel fired plants quoting at P62/kwh and concludes there is enough supply and Malaya need not be called.
Or did NGCP collude with some generators to keep rates high? Note that NGCP also failed in its duty as system administrator to properly schedule maintenance shutdown of some generators in the light of the Malampaya shutdown. Henry Sy Jr.’s Triratna group once made an offer to buy Meralco from the Lopezes in alliance with San Miguel, presumed owner of one of the generators that submitted maximum bids shown above.
NGCP is not concerned about the impact of high dispatch rates to consumers. The massive profits of the group of Henry Sy Jr and their Chinese government partner at NGCP are protected by ERC on a formula that allows full recovery of claimed costs plus margin.
On the other hand, PSALM, the government entity that now owns Malaya, is not keen on running the 620 MW power plant because it is expensive to do so.
Malaya is a base load plant designed to run for long periods of time. It takes 16 hours of running offline before it can be lined up for dispatch. Indeed it makes no sense to burn diesel for almost a day only to run for two hours to satisfy peak demand. The other diesel plants can be dispatched in less than half an hour.
Still, the Malampaya shutdown was planned in advance and PSALM could have arranged to run Malaya not only to prevent a brownout and also to prevent spot prices going too high during the entire period. Malaya operated only from Dec. 2 to 10, or too late to arrest the surge in generation rates.
Meralco president Oscar Reyes observed that “There is an analysis of the behavior of the WESM, if Malaya was online and offered during the Malampaya shutdown, the WESM average price Nov. 11 to Dec. 10 would have gone down by as much as 70 percent from P21 per kwh to about P5 per kwh.”
PSALM’s Emmanuel Ledesma Jr did a Pontius Pilate and insisted “NGCP is the one who determines dispatch. My understanding was the supply was sufficient. NGCP never mentioned anything to us with regard to insufficiency of supply.”
NGCP, for its part, stressed that during the Malampaya shutdown from Nov. 11 to Dec. 10, there was actually no shortage in supply. “There was no deficiency in the system. In that period, there was sufficient capacity,” Raul Saludo, head of NGCP’s system operations for Luzon, also said during the hearing.
That’s because NGCP was only looking at the technical sufficiency of demand, that is, there was no system condition (e.g. voltage problem) that would trigger the call for must run units. But NGCP should have also been looking at what was happening in the spot market. Or maybe, that is the job of the Department of Energy who should have had an active monitoring team during those critical days.
What do I see from all these facts? Collusion may be hard to prove but I clearly see there is no one looking out for the consumers. The private sector generators were after maximizing profits which the deregulated environment under EPIRA allows.
The diesel power generators saw an opportunity to make big money. Their plants are idle most of the time and this was a rare opportunity to loudly ring the cash registers. Because the Energy Secretary declared Malaya to be on economic shutdown and knowing how reluctant PSALM is in running Malaya, they were emboldened to bid at the maximum allowed.
If Energy Secretary Jericho Petilla was more alert and decisive, he should have surprised all of them by ordering Malaya to run and thus screw the generators before the generators could screw the consumers. The behavior of the generators in a tight market should have been predictably obvious to Petilla, who after all, is energy secretary.
Indeed, there is a protocol that former Energy Secretary Rene Almendras used in past Malampaya shutdowns and other emergencies called the Grid Operations and Maintenance Protocol which Secretary Petilla should have used.
As it turned out, Malaya proved to be a paper tiger. It was the only weapon the Secretary of Energy had and he failed to use it.
Of course the Secretary will say he also has the mandate to maintain a power industry environment conducive to more investments in power plants. Using Malaya the way Almendras did to dampen rates would have given a negative investment signal.
The tunnel vision of NGCP and PSALM can only be described as an absence of malasakit for the consumers. That, plus the incompetence of ERC and DOE sealed the negative outcome for all of us.
Sec Petilla should have realized that his most immediate responsibility is to protect the consumers. Allowing the rates to go haywire as it did produced a serious political backlash that is bad for the power industry too.
Now they are telling us that the average price of power to consumers last year was lower than the year before. That may be true but allowing that extreme volatility to happen makes that fact simply incredible to consumers.
The senators must follow the money if they want to know who had the most number of orgasms from that rate orgy.
DEMAND AND SUPPLY By Boo Chanco (The Philippine Star) | Updated January 27, 2014 - 12:00am
If you followed the Senate hearing on what went wrong with our power bills, a typical consumer will likely end up more confused than ever. The various parties invited to shed light ended up pointing to each other as being primarily responsible for screwing us, the power consumers.
The problem with that hearing is that it was mostly the lawyers talking and we all know lawyers aren’t as interested in unearthing the truth as they are with protecting their principals. They will obfuscate the issues and because of the technical complexities of the power industry, it is easy to obfuscate.
There was also failure to ask more tough questions. I am however glad that enough was said to confirm most of the points I have raised in this column. But the smoking gun was nowhere in sight.
Indeed, the issue of collusion was all but forgotten. I feel the way to get to the truth of who was responsible for that catastrophic rise in our power bills is to follow the money. By this I mean look into the records of WESM to see who gave a maximum bid of P62/kwh and actually got dispatched.
Some executives of generating companies were reportedly popping champagne bottles and computing their expected outsized bonuses because of the extraordinary profits from that national tragedy. But some of them are saying they were not the only ones who earned a bonanza. They tell me we should also focus on possible “trading profits” of Meralco.
Let us try to follow the money. Based on records, here is the list of generators who submitted bids in the 60s level during the time in question. Their bids were dispatched, thus setting the clearing price.
In sum, there were 23 out of 744 intervals (hours) in November and 68 out of 720 intervals in December that cleared at approximately P60/kwh during the time that the Malampaya platform was being maintained including at non peak hours.
For the November billing period (Oct. 26 to Nov. 25), these were the days and plants that offered >60 P/kWh.
November 10: 1590 (Bauang), Pan Asia (Limay)
November 15: 1590 (Bauang), Therma Mobile (Navotas)
November 16: 1590 (Bauang),Therma Mobile(Navotas)
November 17: 1590 (Bauang), Therma Mobile(Navotas)
November 20: 1590 (Bauang), Therma Mobile(Navotas)
November 23: 1590 (Bauang), Therma Mobile(Navotas)
November 25: 1590 (Bauang), Therma Mobile(Navotas)
For the December billing period (November 26 to Dec. 25), these were the days and plants that offered >60 P/kWh.
November 26: Pan Asia (Limay), APRI (Makban)
November 27: Pan Asia (Limay),
November 30: Therma Mobile(Navotas)
December 1: Therma Mobile(Navotas)
December 2: Pan Asia (Limay),
December 3: Pan Asia (Limay),
December 5: 1590 (Bauang), Pan Asia (Limay),
December 6: 1590 (Bauang), Therma Mobile (Navotas), Pan Asia (Limay),
December 7: Therma Mobile(Navotas)
December 8: 1590 (Bauang), Therma Mobile(Navotas),
December 11: 1590 (Bauang), Therma Mobile(Navotas),
December 12: Therma Mobile(Navotas).
These are all diesel powered plants except for APRI (Makban) an Aboitiz geothermal plant. The 1590 Bauang plant is owned by a company called Vivant, a company that also owns VECO. The Limay plant used to be owned by San Miguel who supposedly divested it to another company which many in the industry believe is still related to San Miguel. Therma Mobile belongs to Aboitiz Power and fully contracted to Meralco which in effect makes it a Meralco plant.
It should be interesting to know how much these companies earned during the Malampaya shutdown emergency. Checking the details of the records can help tell us the presence of collusion.
On the other hand, we can also point out the appearances of collusion by analyzing the bidding behavior. We start with the fact that all the generating companies know Malaya is hardly dispatched. Thus, in making their bid calculations, they assume Malaya is out of the picture.
Did they can see the thin reserve and agreed with each other to all submit bids on the high side… up to the limit of P62/kwh? Or did they give their bids as independent rational decisions based on market conditions?
The NGCP as system administrator, on the other hand, sees all the available generating plants including the diesel fired plants quoting at P62/kwh and concludes there is enough supply and Malaya need not be called.
Or did NGCP collude with some generators to keep rates high? Note that NGCP also failed in its duty as system administrator to properly schedule maintenance shutdown of some generators in the light of the Malampaya shutdown. Henry Sy Jr.’s Triratna group once made an offer to buy Meralco from the Lopezes in alliance with San Miguel, presumed owner of one of the generators that submitted maximum bids shown above.
NGCP is not concerned about the impact of high dispatch rates to consumers. The massive profits of the group of Henry Sy Jr and their Chinese government partner at NGCP are protected by ERC on a formula that allows full recovery of claimed costs plus margin.
On the other hand, PSALM, the government entity that now owns Malaya, is not keen on running the 620 MW power plant because it is expensive to do so.
Malaya is a base load plant designed to run for long periods of time. It takes 16 hours of running offline before it can be lined up for dispatch. Indeed it makes no sense to burn diesel for almost a day only to run for two hours to satisfy peak demand. The other diesel plants can be dispatched in less than half an hour.
Still, the Malampaya shutdown was planned in advance and PSALM could have arranged to run Malaya not only to prevent a brownout and also to prevent spot prices going too high during the entire period. Malaya operated only from Dec. 2 to 10, or too late to arrest the surge in generation rates.
Meralco president Oscar Reyes observed that “There is an analysis of the behavior of the WESM, if Malaya was online and offered during the Malampaya shutdown, the WESM average price Nov. 11 to Dec. 10 would have gone down by as much as 70 percent from P21 per kwh to about P5 per kwh.”
PSALM’s Emmanuel Ledesma Jr did a Pontius Pilate and insisted “NGCP is the one who determines dispatch. My understanding was the supply was sufficient. NGCP never mentioned anything to us with regard to insufficiency of supply.”
NGCP, for its part, stressed that during the Malampaya shutdown from Nov. 11 to Dec. 10, there was actually no shortage in supply. “There was no deficiency in the system. In that period, there was sufficient capacity,” Raul Saludo, head of NGCP’s system operations for Luzon, also said during the hearing.
That’s because NGCP was only looking at the technical sufficiency of demand, that is, there was no system condition (e.g. voltage problem) that would trigger the call for must run units. But NGCP should have also been looking at what was happening in the spot market. Or maybe, that is the job of the Department of Energy who should have had an active monitoring team during those critical days.
What do I see from all these facts? Collusion may be hard to prove but I clearly see there is no one looking out for the consumers. The private sector generators were after maximizing profits which the deregulated environment under EPIRA allows.
The diesel power generators saw an opportunity to make big money. Their plants are idle most of the time and this was a rare opportunity to loudly ring the cash registers. Because the Energy Secretary declared Malaya to be on economic shutdown and knowing how reluctant PSALM is in running Malaya, they were emboldened to bid at the maximum allowed.
If Energy Secretary Jericho Petilla was more alert and decisive, he should have surprised all of them by ordering Malaya to run and thus screw the generators before the generators could screw the consumers. The behavior of the generators in a tight market should have been predictably obvious to Petilla, who after all, is energy secretary.
Indeed, there is a protocol that former Energy Secretary Rene Almendras used in past Malampaya shutdowns and other emergencies called the Grid Operations and Maintenance Protocol which Secretary Petilla should have used.
As it turned out, Malaya proved to be a paper tiger. It was the only weapon the Secretary of Energy had and he failed to use it.
Of course the Secretary will say he also has the mandate to maintain a power industry environment conducive to more investments in power plants. Using Malaya the way Almendras did to dampen rates would have given a negative investment signal.
The tunnel vision of NGCP and PSALM can only be described as an absence of malasakit for the consumers. That, plus the incompetence of ERC and DOE sealed the negative outcome for all of us.
Sec Petilla should have realized that his most immediate responsibility is to protect the consumers. Allowing the rates to go haywire as it did produced a serious political backlash that is bad for the power industry too.
Now they are telling us that the average price of power to consumers last year was lower than the year before. That may be true but allowing that extreme volatility to happen makes that fact simply incredible to consumers.
The senators must follow the money if they want to know who had the most number of orgasms from that rate orgy.
WESM seeks P814M from customers
Another round of increase pending!
***
WESM seeks P814M from customers
By Riza T. Olchondra
Philippine Daily Inquirer
8:26 am | Tuesday, January 28th, 2014
MANILA, Philippines—Philippine Electricity Market Corp., which operates the Wholesale Electricity Spot Market (WESM), seeks to collect market transaction fees (MTFs) of P814.5 million from trading participants this year.
In an order, the Energy Regulatory Commission (ERC) said that pending the final resolution of the proposed MTF, the spot market administrator should continue applying the 2013 rates.
“Based on initial indicative figures, the estimated (proposed) MTF rate for 2014 is P0.0125/kWh,” the ERC said, noting that this represents a 4 percent decline from the 2013 rate.
The new rate sought was based on the projected energy transactions in Luzon and Visayas this year of 63,789 gWh.
The bulk of the fees sought for 2014 would fund “budgetary requirements” worth P796.024 million, broken down as follows: capital expenditures (P82.412 million); personnel services (P388.641 million); maintenance and other operating expenses (P309.363 million); and provision for the Department of Energy/Energy Regulatory Commission monitoring facilities (P15.608 million).
Another P18.505 million was sought for the Year 1 budget for the Market Design and Structural Feasibility Study (Forwards Market) and the Market Research and Development Platform project.
ERC noted, however, that the amounts sought were net of corporate income and value added taxes. These also do not cover possible adjustments in expenses due to changes in regulations, as well as PEMC’s separate applications for additional fees.
On Aug. 14, 2012, PEMC filed an additional MTF application meant to enable the WESM operator to collect some P900 million in fees from trading participants to repay the loan used for the establishment of its Market Management System (MMS) loan. That was done under agreements with state-owned firms National Power Cop., National Transmission Corp. and Power Sector Assets and Liabilities Management Corp.
On Sept. 15, 2011, PEMC filed separate applications for additional MTF for a New Market Management System (NMMS) project.
ERC said PEMC’s MMS and NMMS applications were still pending.
Read more: http://business.inquirer.net/161959/wesm-seeks-p814m-from-customers#ixzz2reMdklVP
Follow us: @inquirerdotnet on Twitter | inquirerdotnet on Facebook
***
WESM seeks P814M from customers
By Riza T. Olchondra
Philippine Daily Inquirer
8:26 am | Tuesday, January 28th, 2014
MANILA, Philippines—Philippine Electricity Market Corp., which operates the Wholesale Electricity Spot Market (WESM), seeks to collect market transaction fees (MTFs) of P814.5 million from trading participants this year.
In an order, the Energy Regulatory Commission (ERC) said that pending the final resolution of the proposed MTF, the spot market administrator should continue applying the 2013 rates.
“Based on initial indicative figures, the estimated (proposed) MTF rate for 2014 is P0.0125/kWh,” the ERC said, noting that this represents a 4 percent decline from the 2013 rate.
The new rate sought was based on the projected energy transactions in Luzon and Visayas this year of 63,789 gWh.
The bulk of the fees sought for 2014 would fund “budgetary requirements” worth P796.024 million, broken down as follows: capital expenditures (P82.412 million); personnel services (P388.641 million); maintenance and other operating expenses (P309.363 million); and provision for the Department of Energy/Energy Regulatory Commission monitoring facilities (P15.608 million).
Another P18.505 million was sought for the Year 1 budget for the Market Design and Structural Feasibility Study (Forwards Market) and the Market Research and Development Platform project.
ERC noted, however, that the amounts sought were net of corporate income and value added taxes. These also do not cover possible adjustments in expenses due to changes in regulations, as well as PEMC’s separate applications for additional fees.
On Aug. 14, 2012, PEMC filed an additional MTF application meant to enable the WESM operator to collect some P900 million in fees from trading participants to repay the loan used for the establishment of its Market Management System (MMS) loan. That was done under agreements with state-owned firms National Power Cop., National Transmission Corp. and Power Sector Assets and Liabilities Management Corp.
On Sept. 15, 2011, PEMC filed separate applications for additional MTF for a New Market Management System (NMMS) project.
ERC said PEMC’s MMS and NMMS applications were still pending.
Read more: http://business.inquirer.net/161959/wesm-seeks-p814m-from-customers#ixzz2reMdklVP
Follow us: @inquirerdotnet on Twitter | inquirerdotnet on Facebook
2014/01/09
Meralco sets new hike
Meralco sets new hike
By Alena Mae S. Flores | Jan. 09, 2014 at 12:01am
Computation for January rates to be released today
CONSUMERS face a new spike in their electricity bills as a result of the lingering effects of the shutdown of the Malampaya gas field and other power plants, the Manila Electric Co. (Meralco) said Wednesday.
The country’s biggest power distributor will release its computation for the January rates today.
The company’s head of utility economics, Lawrence Fernandez, said Meralco said the actual January generation charges billed to consumers will still be at P5.67 per kilowatt-hour because of a 60-day temporary restraining order imposed by the Supreme Court.
“The December supply month continued to be affected by forced, scheduled and extended power plant outages. These were on top of the Malampaya shutdown, which affected 15 days of the supply month. As in November, all these would correspondingly affect December’s generation costs,” he said.
The Malampaya gas platform was shut down for maintenance from Nov. 11 to Dec. 10 but Meralco was only able to compute the impact on power bills from Nov. 11 to Nov. 25 because its billing cycle ends every 26th of the month.
Earlier, Meralco sought to impose a P4.15 per kWh increase – the highest in the country’s history – but was stopped from doing so when the Supreme Court issued a temporary restraining order while it decides on the petitions filed against the rate hike.
The government has asked the Supreme Court to excuse the Energy Department and the Energy Regulatory Commission, from commenting on the petitions against the rate hike, even though they were also named as respondents.
The Office of the Solicitor General said both the department and the ERC were nominal parties that were not directly involved in the case, and should therefore be exempted from filing their comments.
In doing so, the government was leaving it to Meralco to defend its P4.15 rate hike.
Meralco was set to file its comment Wednesday, the deadline set by the court for respondents to answer the consolidated petitions.
Oral arguments have been set for Jan. 21.
Petitioners alleged that their constitutional right to due process was violated when the ERC approved the rate hike without public hearings. They also attacked the ERC for approving Meralco’s petition just four days after it was submitted.
Meralco’s P4.15 computation does not include the price impact from Nov. 26 to Dec.10, during which Malampaya was still closed, company officials said.
As a result of the restraining order, Meralco has asked its customers to set aside their December billing and use the November billing as a guide for paying.
Meralco president Oscar Reyes earlier expressed concern over the lingering impact of the Malampaya shutdown and new plant shutdowns on power rates.
“Even as we may expect the generation cost and the WESM (Wholesale Electricity Spot Market) charges, volatile as they are, to drift down to more normal levels in March 2014, rendering this a temporary blip for now, we are still challenged by new or additional power outages which have risen in the last two weeks in the January billing,” Reyes said.
The ERC, meanwhile, has yet to release the results of its investigation into allegations that power suppliers had colluded to jack up electricity rates in time for a Jan. 15 submission to the Senate.
“We have no commitment [to Congress]. It is not yet finished,” ERC spokesman Francis Saturnino Juan said.
“There is no definite timeline for the investigating unit (to submit its report),” he said.
Earlier, ERC Commissioner Josefina Patricia Asirit said it was possible that the report would be released before Jan. 15.
She said commission is set to hold its first regular meeting on Jan. 13 but is not sure when the investigation unit will present its results to the commission.
The regulator is conducting its report amid allegations of market abuse, which pushed up the generation costs of Meralco.
In the House, Oriental Mindoro Rep. Reynaldo Umali confirmed that the House had not received a report on the allegations of collusion either, despite assurances that the report would be submitted by Jan. 6.
Umali said Energy Secretary Jericho Petilla and ERC chairwoman Zenaida Ducut gave no reason for their failure to comply.
“It is the first time we tasked them to report and they failed to submit. Reportedly they said they will complete their investigation and report on Dec. 30, 2013 and then Jan. 6, 2014,” Umali said.
The House committee on energy chaired by Umali was scheduled to resume its probe of the power rate hike Wednesday, Jan. 8 but the hearing was cancelled.
Earlier, the Energy Department admitted that Meralco’s P4.15 kWh increase was much higher than their anticipated rate of P1.58 per kWh.
At a hearing conducted by the House committee on energy last year, Energy Undersecretary Raul Aguilos had disclosed that the Energy Department already conducted its probe into the unplanned outages that occurred in several plants like the Sta. Rita, San Lorenzo, Pagbilao, Masinloc, GN Power, Calaca and Ilijan.
Meralco blamed the power plant outages, especially the scheduled maintenance shutdown of the Malampaya natural gas platform, for the higher cost of electricity.– With Maricel V. Cruz and Rey E. Requejo
http://manilastandardtoday.com/2014/01/09/meralco-sets-new-hike/
***
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By Alena Mae S. Flores | Jan. 09, 2014 at 12:01am
Computation for January rates to be released today
CONSUMERS face a new spike in their electricity bills as a result of the lingering effects of the shutdown of the Malampaya gas field and other power plants, the Manila Electric Co. (Meralco) said Wednesday.
The country’s biggest power distributor will release its computation for the January rates today.
The company’s head of utility economics, Lawrence Fernandez, said Meralco said the actual January generation charges billed to consumers will still be at P5.67 per kilowatt-hour because of a 60-day temporary restraining order imposed by the Supreme Court.
“The December supply month continued to be affected by forced, scheduled and extended power plant outages. These were on top of the Malampaya shutdown, which affected 15 days of the supply month. As in November, all these would correspondingly affect December’s generation costs,” he said.
The Malampaya gas platform was shut down for maintenance from Nov. 11 to Dec. 10 but Meralco was only able to compute the impact on power bills from Nov. 11 to Nov. 25 because its billing cycle ends every 26th of the month.
Earlier, Meralco sought to impose a P4.15 per kWh increase – the highest in the country’s history – but was stopped from doing so when the Supreme Court issued a temporary restraining order while it decides on the petitions filed against the rate hike.
The government has asked the Supreme Court to excuse the Energy Department and the Energy Regulatory Commission, from commenting on the petitions against the rate hike, even though they were also named as respondents.
The Office of the Solicitor General said both the department and the ERC were nominal parties that were not directly involved in the case, and should therefore be exempted from filing their comments.
In doing so, the government was leaving it to Meralco to defend its P4.15 rate hike.
Meralco was set to file its comment Wednesday, the deadline set by the court for respondents to answer the consolidated petitions.
Oral arguments have been set for Jan. 21.
Petitioners alleged that their constitutional right to due process was violated when the ERC approved the rate hike without public hearings. They also attacked the ERC for approving Meralco’s petition just four days after it was submitted.
Meralco’s P4.15 computation does not include the price impact from Nov. 26 to Dec.10, during which Malampaya was still closed, company officials said.
As a result of the restraining order, Meralco has asked its customers to set aside their December billing and use the November billing as a guide for paying.
Meralco president Oscar Reyes earlier expressed concern over the lingering impact of the Malampaya shutdown and new plant shutdowns on power rates.
“Even as we may expect the generation cost and the WESM (Wholesale Electricity Spot Market) charges, volatile as they are, to drift down to more normal levels in March 2014, rendering this a temporary blip for now, we are still challenged by new or additional power outages which have risen in the last two weeks in the January billing,” Reyes said.
The ERC, meanwhile, has yet to release the results of its investigation into allegations that power suppliers had colluded to jack up electricity rates in time for a Jan. 15 submission to the Senate.
“We have no commitment [to Congress]. It is not yet finished,” ERC spokesman Francis Saturnino Juan said.
“There is no definite timeline for the investigating unit (to submit its report),” he said.
Earlier, ERC Commissioner Josefina Patricia Asirit said it was possible that the report would be released before Jan. 15.
She said commission is set to hold its first regular meeting on Jan. 13 but is not sure when the investigation unit will present its results to the commission.
The regulator is conducting its report amid allegations of market abuse, which pushed up the generation costs of Meralco.
In the House, Oriental Mindoro Rep. Reynaldo Umali confirmed that the House had not received a report on the allegations of collusion either, despite assurances that the report would be submitted by Jan. 6.
Umali said Energy Secretary Jericho Petilla and ERC chairwoman Zenaida Ducut gave no reason for their failure to comply.
“It is the first time we tasked them to report and they failed to submit. Reportedly they said they will complete their investigation and report on Dec. 30, 2013 and then Jan. 6, 2014,” Umali said.
The House committee on energy chaired by Umali was scheduled to resume its probe of the power rate hike Wednesday, Jan. 8 but the hearing was cancelled.
Earlier, the Energy Department admitted that Meralco’s P4.15 kWh increase was much higher than their anticipated rate of P1.58 per kWh.
At a hearing conducted by the House committee on energy last year, Energy Undersecretary Raul Aguilos had disclosed that the Energy Department already conducted its probe into the unplanned outages that occurred in several plants like the Sta. Rita, San Lorenzo, Pagbilao, Masinloc, GN Power, Calaca and Ilijan.
Meralco blamed the power plant outages, especially the scheduled maintenance shutdown of the Malampaya natural gas platform, for the higher cost of electricity.– With Maricel V. Cruz and Rey E. Requejo
http://manilastandardtoday.com/2014/01/09/meralco-sets-new-hike/
***
At EastGreenfields, we can supply Solar Power Generation package that can lock-up your power bills for 25 years... No more power hike worries!
2013/12/23
Stop power rate hike
‘Stop power rate hike’
By Manila Standard Online_Dec 23, 2013
Solons ask High Court to scrap Meralco move
LAWMAKERS on Thursday asked the Supreme Court to stop Manila Electric Co. from jacking up electricity rates by P4.15 per kilowatt hour, the highest increase in the country’s history.
In their petition, Bayan Muna Reps. Neri Colmenares and Carlos Isagani Zarate; Gabriela Women’s Party Reps. Luz Ilagan and Emmi de Jesus; ACT Teachers Party-list Rep. Antonio Tinio; and Kabataan Party-list Rep. Terry Ridon sought the immediate issuance of temporary restraining order, arguing that the rate increase come at the worst time possible, with the country still reeling from the effects of super typhoon Yolanda.
The groups also asked the Court to nullify the Energy Regulatory Commission approval of Meralco’s rate hike.
They also appealed to the justices to declare as unconstitutional a provision of the Electric Power Industry Reform Act or EPIRA of 2001 which declared that the power generation and supply sectors were not public utilities, and therefore not subject to regulation by the ERC.
In its letter to the ERC dated Dec. 5, Meralco said it would have to increase rates by P4.15 per kWh for residential consumers because it needed to buy more expensive power following the maintenance shutdown of the Malampaya gas field.
On Dec. 9, the ERC approved Meralco’s request.
In approving the increase without the benefit of a public hearing, which is required by law, the ERC committed grave abuse of discretion, the lawmakers said.
EPIRA, the petitioners added, was aimed at promoting competition and penalizing abuses of market power in a restructured electricity industry.
Given “the suspiciously sudden and simultaneous shutdown of various power plants” to coincide with the announced Malampaya maintenance, the ERC should not have approved Meralco’s petition barely three days from its submission.
The petitioners accused the ERC of reneging on its duty to protect the public from anti-competitive practices and market abuse when it approved the P4.15 increase despite clear indications of irregularity in the simultaneous planned and unplanned shutdowns, the hefty spike of electricity prices that Meralco sought.
“It is really mind boggling that the ERC hastily approved Meralco’s letter request,” the petitioners said, adding that the commission’s actions were also collusion with vested oil interests.
In the Court of Appeals, the Special 16th Division junked a petition filed by the Foundation for Economic Freedom seeking to stop the ERC from hearing and deciding on a petition filed by the National Renewable Energy Board, which is expected to increase power rates to consumers.
Associate Justice Pedro Corales ruled that the petition was moot and academic because the ERC had already ruled on NREB’s petition in October and November.
The Appeals Court also ruled that the ERC had not committed grave abuse in approving NREB’s petition.
The NREB filed the petition with the ERC on behalf of the renewable energy suppliers to adopt a feed-in-tariff for electricity generated from biomass, ocean, run-off-river hydropower, solar and wind energy resources.
The tax on electricity consumers for a period of 20 years would generate money for a subsidy to encourage the development of renewable sources of energy.
The FEF had warned that the taxes from electricity consumers nationwide would reach P11 billion annually for the next 20 years collectible through their monthly billings.
The Palace on Thursday said it was determined “to uphold and protect the citizens’ welfare” and to carry out its mandate to prevent anti-competitive and market abuse practices.”
“In view of this, we support the current Senate inquiry into the recent power rate adjustments. This runs parallel to the on-going investigation of the tripartite committee composed of the Department of Energy, Energy Regulatory Commission, and the Philippine Electricity Market Corporation, as well as that of the Justice Department’s Office of Competition,” Communications Secretary Herminio Coloma Jr. said in a press briefing.
Coloma said the Aquino administration hoped that “the Senate inquiry will also lead to concrete proposals on how existing laws can be improved so that the protection of consumer welfare will be assured.”
Senate President Frankllin Drilon on Thursday said if collusion is proved in the recent rate hikes, the appropriate criminal charges would be filed.
Also on Thursday, a labor group criticized Senator Sergio Osmena III for concluding publicly that there was no collusion among power generating companies and Meralco on the rate hike, pre-empting the investigtions by the Energy and Justice departments.
“Serge is a consistent supporter of power industry players since his sponsorship of the EPIRA Law which ushered in the era of high electricity rates to his defense of Meralco’s gargantuan rate hike,” said Wilson Fortaleza of the Partido ng Manggagawa.
Fortaleza was one of the signatories to the complaint against Meralco and generation companies lodged by groups last Monday with the Justice Departments Office for Competition.
Justice Secretary Leila de Lima vowed to come up with the findings by January next year. – With Macon Ramos-Araneta, Ronald O. Reyes and Vito Barcelo
***
EastGreenfields post note on NREB petition for power rate increase.
The power rate is expected to increase pending on the implementation of Renewable FIT rates. This is inevitable since Green sources has to be funded by payments from FIT.
At first look, the FIT will be an increase in each consumers billing but scrutinizing it further will reveal that FIT rates are actually in parity or even lower (for Biomass), see table below:
Solar FIT: P9.68 / kW-hr
Wind FIT: P8.53 / kW-hr
RoR Hydro FIT: P5.90 / kW-hr
Biomass FIT:P6.63 / kW-hr
These rates are not going to be demanded from all grid consumers but rather will be computed and blended with the mixed generation rates, in proportion to it's contribution.
Solar FIT: P9.68 / kW-hr
Wind FIT: P8.53 / kW-hr
RoR Hydro FIT: P5.90 / kW-hr
Biomass FIT:P6.63 / kW-hr
These rates are not going to be demanded from all grid consumers but rather will be computed and blended with the mixed generation rates, in proportion to it's contribution.
2013/12/21
Batteries for Renewable Energy System
Understanding Batteries for Your RE System
HP
By:
Issue
Date
Last
Updated:
Aug 22,
2013
When shopping for batteries for a renewable energy
(RE) system, it is important to choose a battery designed for deep-cycling, and
one with a track record of long-term reliability and performance. Make sure to
evaluate both the battery manufacturer’s reputation for using quality
components, as well as the manufacturing process employed to assemble a
deep-cycle battery.
While buying cheap batteries may seem
a good idea at first, it can cost you much more down the road. Cheap batteries
will not withstand the rigorous deep-cycling that is inherent in RE
applications. Over time, these batteries will fail and need to be replaced more
often than quality deep-cycle batteries, costing you more money in the long
run. Lower overall cost of ownership and reducing the need to constantly
replace batteries should be the determining factors, not just the initial
purchase price.
Battery
Types
A battery uses an electrochemical
reaction to store energy. Unlike primary batteries that cannot be recharged,
secondary batteries can be recharged many times before they reach the end of
their life. Several types of secondary batteries are available in sizes
appropriate for an RE system, including lead-acid, lithium ion, nickel-cadmium,
and nickel-iron. However, lead-acid, deep-cycle batteries, specifically
designed to be deeply discharged to 50% to 80% of capacity, are most often used
due to their relative low cost and wide availability.
Flooded lead-acid (FLA) and
valve-regulated lead-acid (VRLA, or “sealed”) are two types of lead-acid
batteries. FLA batteries lose electrolyte as the electrolyte is converted from
a liquid to a gas during charging, so the individual cells must be periodically
topped off with distilled water to avoid permanent damage. VRLA batteries can
be either absorbed glass mat (AGM) or gel and are maintenance-free—they cannot
accept the addition of water. AGM batteries feature individual cells that
contain positive and negative plates separated by a glass mat separator (see
“When to Use VRLAs” sidebar).
Click to enlarge
Batteries
to Suit Your System
Lead-acid batteries are made for
specific discharge duty cycles. For example, a starting-lighting-ignition (SLI)
battery (used to start vehicles) is designed to deliver high amperage for short
durations, and then be recharged quickly. Similarly, a lead-acid battery that
is part of an uninterruptible power system (UPS) may need to provide energy for
just a few minutes when the utility experiences a grid anomaly or
outage—usually only a few amp-hours are taken out of the battery. In contrast,
a battery in an RE application must run various electrical loads for long
durations, and possibly over several days. So for an RE application, choose a
battery designed for a marathon, not a sprint.
Charging characteristics also
influence battery choice. A SLI battery is designed to charge for a few hours
at most (via the vehicle’s alternator) before the next engine-cranking event.
Since a UPS battery has to be ready for discharge at any time, it is on a
trickle (“float”) charge whenever the source is available. A deep-cycling RE
battery will experience constant charging and discharging over several years.
Because of this, the ideal battery for an RE application must be capable of
delivering many cycles over a longer time than SLI, and can have some charging
flexibility—either more slowly from an RE source or more quickly from a backup
generator.
Details
Make a Difference
Although all battery manufacturers use
the same general processes, all batteries are not created equal. There are
significant differences in the battery components used during the manufacturing
process as well as the quality control processes each battery manufacturer
implements within their facilities. Evaluating these differences is key in
determining a battery’s longevity and performance, and this information can
usually be found on a deep-cycle battery manufacturer’s website. If not, ask
your sales rep or the battery manufacturer directly about specific
manufacturing processes.
The working components of lead-acid
batteries are their plates, which are made of lead. To harden the lead for use
in a battery, it is combined with other metals (calcium, in VRLA batteries;
antimony, in flooded batteries).
Lead oxide is used to produce the pastes,
which include the positive active material (PAM) or negative active material
(NAM) that is applied to a grid of lead that becomes the battery’s positive and
negative plates. The chemical compositions of PAM and NAM are proprietary.
Deep-cycle batteries have PAM and NAM recipes tailored for applications such as
RE, propulsion (in EVs), or equipment like electric forklifts. Therefore, it’s
important that a user understand what they want to achieve from their
batteries—long float life or long cycle life. A battery’s design and paste
formulations are customized for one or the other.
The battery’s lead grids are designed
to hold the active materials (PAM and NAM). The grids also provide an
electrically conductive path that enables the electrons to move in and out of
the battery. Positive and negative grids are cast from molten lead alloys, and
the patterns used in the design of grids vary from manufacturer to
manufacturer. Grid designs and configurations help the current flow through the
grid network, enhancing overall battery performance.
Once the positive and negative grids
are pasted with PAM or NAM, they undergo curing, in which the paste is dried
slowly. During this process, a bond is created between the paste and metallic
grid, to develop an electrochemically active mass. Curing must be accomplished
under precisely controlled temperature and humidity to produce a high-quality
battery. The curing time can take as long as 72 hours to fortify the
interlocking crystal structure of the PAM and NAM.
After curing, the plates are arranged
in groups, alternating positive and negative. A separator is placed between
each plate that prevents them from touching and shorting. The separator
material’s quality and design are important factors in determining the battery’s
service life. High-quality batteries use glass mat or rubber separators that
reduce the chance of stratification, which is a typical mode of battery failure
in renewable energy systems. Stratification is the process in which the acid
concentration at the bottom of the battery becomes greater than the
concentration at the top. If not addressed, stratification will destroy a
battery.
After the appropriate number of
positive and negative plates are stacked, they are placed into a plastic case,
which contains one cavity for a 2 V cell, three for a 6 V battery, or six for a
12 V battery. The number of plates depends on the specific capacity of the
battery being built, i.e., the greater the amp-hour capacity, the larger the
number of plates. The positive plates are then welded together at the top, as
are the negative plates, forming a single cell assembly. In multiple-cell
batteries, each cell assembly is welded in series or in parallel to determine
the battery’s voltage.
A cover is then heat-sealed to the
case. The quality of this seal is important—if poorly done, the seal’s
integrity can be compromised, leading to future problems such as breakage
and/or separation of the lid from the battery case.
Once battery assembly is complete, the
battery goes through “formation.” The formation process involves filling the
battery with a solution of sulfuric acid and distilled water. The battery is
then given an initial charge, which preps the battery plates for operation.
Formation usually takes several days to complete; the greater the battery
capacity, the longer the formation period.
When the formation process is
complete, the battery is tested to confirm it meets the manufacturer’s
specifications. This is called “end of line” testing, which ensures all
electrical connections are working properly and there are no obvious defects.
The battery is then cleaned of any residual acid on its external surfaces,
labeled to be in compliance with all necessary regulations, and prepared for
shipping.
Quality
Control
The differences in the manufacturing
processes for a deep-cycle battery can have a profound effect on its
performance and life, as seen in the images that show high- and lower-quality
batteries.
Both had the same rated capacity, were
the same age, and experienced identical service under controlled conditions.
However, the battery on the left has aged far more gracefully than the one on
the right. Why? The battery cell on the left has a moss shield on the top of
the plates, which prevents the plates from expanding and shorting out at the
top of the cell. The absence of a top shield on the other battery eventually
caused short-circuiting, leading to lower capacity and a shorter life span. The
battery on the left also featured a paste formulation specifically designed to
optimize use of the battery’s active material, resulting in sustained battery
performance over a longer period of time.
Besides the presence of a moss plate,
the design and use of a battery’s grid and separators are equally important.
Corrosion can quickly kill a battery, and the thicker a battery’s grid
structure, the greater its resistance to corrosion. It also is important to
ensure that the grids are cast, rather than stamped. Cast grids have no
hairline fractures, which can cause the battery to fail prematurely.
In addition, separators between the
battery plates should feature wide channels to increase the flow of acid, which
enables optimum battery performance. Batteries that feature separators with
wide-channel designs will also offer greater resistance to stratification.
Outside
Parameters
An essential component of determining
the quality of a deep-cycle battery is the manufacturer’s investment in
independent third-party testing. This data provides valuable information on
product performance, and validates a manufacturer’s product claims.
Independent, third-party data obtained from testing batteries per
industry-recognized standards, such as by the International Electrotechnical
Commission (IEC), allows consumers to compare products from different
manufacturers, and can be found on some battery manufacturers’ websites.
For an RE application, the two
parameters of critical importance are amp-hour capacity (commonly at the
20-hour rate) and the number of cycles the battery can deliver to a given depth
of discharge (DOD)—for example, 3,000 cycles at 50% DOD.
Once the short list of possible
battery options has been created, the next task should be to ensure the battery
manufacturer has not only a proven track record, but also builds quality into
each battery it ships.
The type of battery you choose and the
vendor you purchase from can have a significant impact on the performance,
durability, and total cost of a renewable energy system. The battery bank in an
RE system typically represents the largest equipment cost over the life of the
system, so proper understanding of deep-cycle batteries is important to
maximize the return on your investment.
Click to enlarge
Kalyan Jana is a senior applications engineer for
Trojan Battery’s renewable energy group.
***
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