Power supply coverup?

Orlando Oxales, Fellow of the Stratbase ADR Institute and Lead Convenor of CitizenWatch Philippines

The arrival of the summer season came with the usual uncertainties regarding the country’s power supply, especially that of the Luzon grid. This is especially troubling, as it came despite repeated assurances from the Department of Energy of a stable supply of power for the summer.

In fact, just a day after the DOE made the announcement, a series of yellow alerts hit the Luzon grid mainly due to forced outages and plants that supplied derated capacity. The first wave hit on March 5, 7, and 8, while the next one was just last week, from April 1 through 5. While not a huge alarm by any measure, this indicates that the grid is showing signs of a tight power supply. This means that Luzon is increasingly becoming vulnerable to outages and power interruptions.

More troubling, however, are the reports that went around that instead of finding ways of addressing this supply issue, the government has been trying not to publicize the supply situation.

This blatantly goes against the need for more transparency that can serve to deter possible collusion in the spot market. After all, power generation companies are the first to know when the demand is forecast to be high and therefore to increase their bids. This means that the supply situation surrounding these yellow alerts are a matter of public interest.

For one, these yellow alerts have always served as an effective warning to the public to be mindful of their electric consumption and for big load customers to participate in the Interruptible Load Program.

In a statement, consumer watchdog CitizenWatch raised the concern of price spikes and expensive disruptions in productivity and unnecessary discomforts that will directly affect all consumers.

“With mid-term elections coming in May, the peak of the hot summer months, this is an urgent concern where government must act swiftly to avoid, as this will directly affect millions of voters,” the group said.

For consumer group Laban Konsumer, there is a need for the Energy Regulatory Commission and the DOE to issue daily updates regarding plant outages and the overall power situation so that consumers, who routinely bear the brunt of both interruptions and rate hikes, can readily monitor the situation.

“The matter affects public interest and the right of consumers to information,” said Laban Konsyumer president Vic Dimagiba. “A news blackout is an example of bad governance and lack of transparency. The DOE should as soon as possible lift the news blackout.”

A daily update on the status of the country’s power plants and the supply-demand situation is also the call of 1-Care Party-List Rep. Carlos Uybarreta, vice chairperson of the house energy committee.

“Consumers must be able to monitor the power situation of the grid on a daily basis, and this includes the much-needed information regarding the white, yellow, and red alert statues for the grid,” he said. An additional concern regarding the yellow alerts is its timing, coming less than a month before the critical midterm elections in May, something that the publicizing of timely information can remedy.

Similarly, Infrawatch Philippines convenor and former member of the House energy committee Terry Ridon raised the alarm regarding the repercussions of the series of yellow alerts for consumers.

He explained, “Without a sufficient operating reserve, we are opening the public to higher power rates through the spot market. This is clearly unacceptable and raises concerns on whether we are headed to a power crisis.”

Last Thursday, however, a DOE press conference on the series of yellow alerts didn’t seem to bode well for those clamoring for transparency. The event featured stakeholders in the power sector, including DOE Undersecretary Wimpy Fuentabella, Andrea May Caguete of newly created spot market operator Independent Electricity Market Operator of the Philippines, Fidel Dagsaan of the National Grid Corporation of the Philippines, and Meralco spokesman Joe Zaldarriaga.

Glaringly absent in the lineup is any representative from the generating companies that are in fact responsible for the tight power supply that had led to the yellow alerts in the first place. If everything is above board, then it ought to be simple to explain the nitty-gritty of the details of the supply and demand situation that led to the yellow alerts.

While NGCP shared the details of the yellow alert, it decided to not include the list of plants that contributed to the thinning of the supply. This runs contrary to the wisdom of publishing the list so it may serve as a deterrent against collusion.

As summer heats up, the DOE said it is monitoring the power situation on a weekly basis. Even so, the agency said it doesn’t see any power interruption in Luzon despite the series of yellow alerts. With the state and well-being of the power plants away from public scrutiny, however, an unscheduled shutdown of a major facility can already spell disaster for consumers and the economy alike.

All these scheduled, especially the reasons for all these “forced” shutdowns, must be published. Let the public know what is happening. These Yellow alerts are an effective warning to the public to be mindful of their electric consumption and big load customers to participate in the Interruptible Load Program which has been proven very effective each time there is a looming power shortage, which is now becoming a daily risk.

The cost of electricity is a big chunk of the monthly budget of every household and all industries. As Consumers, we must demand transparency on the power situation. I don’t buy the argument that a gag order to stop publishing yellow alerts will avert spikes in the spot market. On the contrary, these power generation companies are the first to know when demand is high and when to jack up their bids in the spot market. Is there a coverup on our power supply situation?

 

 

This article was originally published in Manila Standard.

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