Reacting to a Bloomberg article noting how the Philippines has emerged as a frontrunner in the region for planned clean energy projects, Philippine Star columnist Pedro “Boo” Chanco III penned, “Should we be impressed? I am not sure that’s something to justify leaping around with joy. We should be concerned more about having sufficient dependable baseload power sources.”
Cautioning against celebrating prematurely, he says that the primary concern should be ensuring sufficient and reliable baseload power sources to keep the Philippine grid stable. Relying too heavily on variable renewable energy sources could lead to more frequent power alerts and potential disruptions, similar to the yellow and red alerts experienced by the country earlier this year.
To Chanco, dependable baseload power can be generated from various sources, such as coal, natural gas, geothermal, storage hydropower, and nuclear. He pondered each of these options.
Geothermal
Although the nation has some geothermal resources, Chanco explained that further exploration and development are hindered by the high costs of exploratory drilling, necessitating government support for private geothermal companies. New technologies like fracking hold promise for expanding the country’s geothermal potential, but these approaches also require substantial investment in costly drilling operations.
Storage Hydro
Weather patterns across the world have become less predictable due to the prolonged El Niño phenomenon, the columnist noted, making storage hydro an unreliable source of baseload electricity for the Philippines.
Natural Gas
Although it may not be the greenest option, to Chanco, natural gas has still proven itself as a suitable transition fuel. Initially viewed as a byproduct of oil production and often wastefully flared, the world eventually came to realize its value.
Chanco stated that if the country could unlock the natural gas deposits in the West Philippine Sea, similar to the Malampaya project, natural gas could serve as a reliable baseload power source. However, the ongoing disputes with China over the Recto Bank area have hindered Filipino ability to develop these resources.
According to the columnist, importing natural gas is currently the most viable option. But this requires the development of proper receiving facilities. He noted that while the Lopez-owned First Gas has been working to address this need, relying on floating storage in the meantime can be risky given the propensity for powerful typhoons and rough seas in our region.
He also mused that natural gas imports also expose the country to the same geopolitical uncertainties that come with its dependence on oil. With the Middle East being an unreliable source given its current political climate, Chanco considered the country’s prospects of importing from the United States instead. Some American citizens want to prioritize domestic use of the substantial gas resource developed in their country, and a Trump victory in the coming elections would likely reinforce these U.S. isolationist tendencies.
Nuclear
Nuclear power offers a stable energy source, but Chanco says this is out of the question for a country that previously abandoned a 620 megawatt (MW) nuclear plant due to fear of nuclear energy. Small modular reactors (SMR) are now being discussed by some. However, a recent study found these reactors to be too costly, slow, and risky, he shared.
Meralco is said to be exploring SMRs, but none are currently operational or under construction outside Russia, China, and India. Chanco said that the Philippines also lacks the appropriate regulatory body for nuclear technology, which would take years to establish, as seen in the Bataan nuclear plant project.
Coal
Ultimately for Chanco, the country is left with coal, an unclean and problematic energy source.
Even with its bad reputation, coal still plays a crucial role in providing stable and reliable electricity generation. Given the abundance of coal resources in Indonesia and the Philippines’ reliable ASEAN relationships, he proffered coal as a viable option for the country.
Storage and Reliability Problems of VREs
Meanwhile, renewable energy advocates maintain that storage has the potential to address the intermittency and unsuitability of variable renewable energy (VRE) sources for baseload power.
Chanco agreed that storage technologies like batteries and compressed air energy storage can indeed help integrate VRE into the grid and provide on-demand clean energy. However, he also noted that most of the VRE projects coming online this year do not include the storage component. This means that the cost of power produced by solar and wind remains high. And with the aging coal power plants and the impact of El Niño on hydropower storage, the columnist concluded that VRE alone cannot be the immediate solution to the country’s energy needs.
He finds compressed air storage an interesting concept, where excess clean energy is used to power an air compressor, and the stored compressed air can then be deployed on demand to generate electricity. But, as he noted, this technology is yet to be commercially tested and proven in an operational power grid.
Chanco stressed that the Department of Energy’s primary responsibility is to guarantee a reliable baseload power supply, and the VRE projects scheduled to go online this year have yet to demonstrate their reliability and effectiveness. The true test, he added, will be how the power grid responds to the influx of VREs, and whether they can maintain stable operations.
Chanco shared that people worried about the nation’s power supply are hesitant to congratulate the Department of Energy for making the Philippines a regional leader in VREs. Currently, the Philippines still has aging coal-fired power plants that require rehabilitation or decommissioning, and he said a clear plan must be in place to ensure their baseload duties are taken over by similarly dependable baseload sources, such as natural gas or new coal. And so he cautioned, “VREs are nice and trendy to have. But who do we blame if our power supply falters while we are happily congratulating each other for making the Philippines the RE leader in the region?”