The Mindanao grid is considered power deficient for the second straight month due to plant outages causing millions of pesos in business losses.
In an interview with The Market Monitor (TMM), the Department Of Energy (DOE) confirmed that the grid was placed under red alert since January this year and up until to its latest monitoring status as of February 24.
It can no longer maintain the required four percent regulating capacity with the peak demand of 1,286 megawatts (MW) and total available capacity of 1,300 MW.
According to the DOE, when the net reserve becomes lower than the regulating capacity then it is necessary to place the grid under red alert that would set load curtailment into motion.
The net reserve, explained the DOE, represents the remaining capacity after deducting the peak demand from the available capacity.
The DoE said Mindanao has reached zero reserve for the past two month based on record of the National Grid Corp. of the Philippines (NGCP).
An official from the DOE Electric Power Industry Management Bureau, Beejee Bequina, said that one to two hours of rotational brownouts were implemented in Mindanao with its red alert status.
At the same time, the manual load dropping was implemented under red alert status and this required electric cooperatives to participate using their embedded generator sets.
Bequina said the rotational brownouts would ease once the programmed commencement operation of the coal-fired Therma plant situated in Davao Del Sur would materialize in the first quarter.
Since January plant outages were reported in Mindanao causing the grid to be placed under red alert, Bequina said.
Last month, the coal plants of STEAG were placed under maintenance schedule and resulting to power deficiency in the grid.
Bequina said that embedded generators units were dispatched which the grid code permits.
These embedded generators are dispatched by the Mindanao electric cooperatives and with cost of electricity to be computed based on the cost of fuel used.
Bequina said that Mindanao end-consumers will be billed based on the generation mix of the electricity and with embedded generators not using coal but fuel, then it follows that the electricity price of coal-fired generation charge not part of the bill during the period these units were dispatched.
With the dispatch of embedded generators of electric cooperatives, the rotational brownouts were recorded lasting 1-2 hours according to the DOE.
However, business groups were concerned of the millions of pesos in losses due to power outages.
Official data revealed that P30 million is being lost on an hour-long brownout in the Mindanao grid.
This figure was supported by Senator Bam Aquino who made representation on behalf of Mindanao businessmen for the lawmakers to address the situation by opening the electricity market to competition and allowing small independent power producers to the market.
The Philippine Power Producers Association Inc. (PIPPA), which groups the country’s biggest generators of electricity led by the Malampaya natural gas-fired power plants, moved for the passage of laws that will allow the independent audit of electricity for dispatch to the central transmission system in regard to the adoption of embedded generator sets.
This move was addressed to the NGCP as well as to the stakeholders in the electricity sector.
The definition of embedded generators according to PIPPA “are generating units that are connected to the distribution utilities’ system. Since the latter are connected to the grid, embedded generators are regarded as indirectly connected to the grid.”
The group further said that the embedded generators can be combined heat and power, fuel cells, photovoltaic solar panels, and industrial sets among others.
The National Electrification Administration (NEA) could not be reached to comment on the status of electric cooperatives participating in the manual load curtailment and adopting the use of embedded generators.
The Market Monitor tried to contact the NEA but representatives were saying that it would be the DOE and the Energy Regulatory Commission (ERC) to provide information about electric cooperatives.