DOE eyes coal blending to cut imports

The Department of Energy (DOE) is studying a coal-blending facility that could expand the use of locally produced Semirara coal in Philippine power plants and reduce the country’s dependence on imported fuel.

Energy Secretary Sharon Garin said the proposed facility could allow locally mined coal to be blended with other grades to meet the specifications of power plants that were designed primarily to burn Indonesian coal.

“We’re trying to study that… That’s why we’ve been discussing about having a terminal or a coal blending facility here,” Garin said during Thursday’s Senate hearing on the DOE’s proposed budget.

The initiative could open a bigger domestic market for Semirara coal while giving power generators another source of fuel as the country seeks to strengthen energy security.

“Dapat yung coal natin as much as possible, we use it domestically (As much as possible, we should use our coal domestically),” Garin said.

DOE data showed that Indonesia supplied 98.8 percent of the Philippines’ coal imports in 2023, even as Semirara Mining and Power Corp. accounted for most of the country’s domestic coal production.

The continued reliance on imports is partly linked to the fuel requirements of existing coal-fired power plants, many of which were built to use higher-grade Indonesian coal.

Sen. Erwin Tulfo questioned the situation during the budget hearing, pointing out that locally produced coal is exported while power generators continue to import much of their requirements.

“Bakit hindi natin gamitin yung coal ng Semirara (Why don’t we use Semirara’s coal)?” Tulfo asked.

Garin said using the entire Semirara output domestically would still cover only about 10 percent of the country’s total coal requirement.

A blending facility, however, could make a larger portion of local coal suitable for existing power plants, potentially expanding domestic consumption and reducing exposure to imported fuel.

The proposal comes as the government seeks to strengthen the country’s energy security by making greater use of available indigenous resources.