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Averting brownouts due to Malampaya maintenance shutdown

Energy officials gave assurances that Luzon will not experience power interruptions while the Malampaya gas facility is undergoing preventive maintenance from October 2 to 22, 2021. The shutdown, however, will possibly result to an increase in consumers’ electricity rates. 

At a recent Senate Energy Committee hearing, Department of Energy (DOE) Assistant Secretary Gerardo Equiza Jr. said, “They don’t have any projected yellow or red alert notice in the course of the usual delivery of power during the Malampaya shutdown.” 

Equiza added, “In their PSAs [power supply agreements], there is a provision that they have to use liquid fuel. The impact, of course is, it’s more expensive so there might be some impact on electricity prices.” 

The costs incurred when they use liquid fuel because the Malampaya gas facility cannot not supply the gas plants, namely Ilijan, Santa Rita, San Lorenzo, Avion, San Gabriel — are passed on to customers via the generation charge. 

These gas power plants have a combined capacity of 3,200 megawatts. Malampaya, the country’s only natural gas facility, supplies power to these plants that in turn provide electricity to 6.575 million residential customers. 

Consumers must understand the effects of these on their electricity bills. Santa Rita, San Lorenzo, San Gabriel and Ilijan plants supply almost 60% of the requirements of Manila Electric Co. (Meralco) which services over seven million customers. 

Meralco said the cost of using liquid fuel is almost twice that of using Malampaya natural gas. “Thus, increase in liquid fuel consumption due to Malampaya curtailment results in higher generation cost,” which accounts for the bulk of the cost component being passed on by Meralco to consumers. 

Senator Sherwin Gatchalian, chairman of the Senate Energy Committee, said, “We’ve been assured that brownouts will not happen during the summer season and that there’s sufficient supply, yet power interruption still took place from May 31 to June 2. I do not wish to call them out on this for the second time in a matter of just four months.” 

Gatchalian added, “We expect the DOE to exhaust all means to ensure the continuity of flow of electricity to our homes and even avert hikes in electricity rates,” he said. 

The last time the Malampaya gas facility underwent a 20-day maintenance shutdown from January 28 to February 16, 2017, the rate impact reached P1.75 billion. To cushion the impact, the Energy Regulatory Commission ordered Meralco to collect from consumers in three monthly installments. 

Power supply disruptions in the past few months have been partial, while the 2017 events that coincided with the Malampaya preventive maintenance involved complete power plant shutdowns. 

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