MGen and mother company Meralco… should focus on reducing electricity rates.
Manila Electric Co. (Meralco) prefers to contradict itself when preaching clean energy. Its power generating unit, Meralco PowerGen Corp. or MGen, prides itself with sustainability and climate responsibility goals—but wants an exemption from the government’s coal ban.
MGen displayed its incongruity when it sought clarification from the Department of Energy (DOE) on the latter’s decision to recall the previous grant of exemption from the coal ban. The power company specifically cited the relief earlier received by its porposed 1,200-megawatt Atimonan coal-fired power plant in Quezon province.
“I’m trying to clarify what aspect of the project will be reviewed… I’m hoping that we can still get this review done sooner rather than later …, MGen president Emmanuel Rubio said at the sidelines of a conference last week.
The DOE in 2020 implemented a moratorium on the processing of applications for greenfield coal facilities. The directive, though, is not comprehensive. It excludes existing and operational coal power plants, or those that are already committed.
MGen, meanwhile, is rushing the completion of the Atimonan power plant by late 2029 or early 2030 in time for the baseload capacity auction that the DOE is scheduling in December.
MGen has insisted that it met the conditions set by the DOE when it issued the exemption. These include the plant’s conversion by 2050 to burn another type of fuel.
“We’re looking at technologies like ammonia co-firing as long as it’s viable… So even in the discussions with our EPCs (engineering, procurement and construction), we already asked them to make sure that the boiler can co-fire ammonia,” says Rubio.
The DOE has also exempted another coal-fired power plant of MGen. The company is now focusing on developing the 82-MW Toledo coal plant in Cebu after obtaining DOE certification of exemption from the coal ban.
MGen is keen on developing the plant given the need for additional baseload capacity in the Visayas region.
MGen’s success in receiving an exemption from the coal ban belies its corporate philosophy on energy transition. The company has committed to decarbonization as part of its sustainability and climate responsibility goals.
“It means reducing our reliance on fossil fuels and accelerating our shift to cleaner, more sustainable energy sources. By 2027, MGen will breach the 1,500 MW renewable energy target three years ahead of schedule―and we are not stopping there,” says Rubio.
The United Nations has called on countries in Asia and the Pacific to speed up the shift from fossil fuels to new, low-carbon development models, in a just and inclusive way.
“Moving away from coal and fossil fuels in a region that accounts for 75 percent of global coal-fired generation capacity will not be easy. But it is essential for our common future, and it is financially and technologically possible,” said UN Deputy Secretary-General Amina Mohammed in 2022.
Expensive power rates
MGen and its mother company Meralco, perhaps, should focus their efforts on reducing the electricity rates in the distributor’s franchise area.
Energy Secretary Raphael Lotilla just last week reminded Meralco that a utility’s performance is measured in its ability to deliver the most affordable power rates to consumers.
“Despite its size and sourcing, [with] nearly half of its power coming from its affiliates, Meralco does not have the cheapest power rates when compared with other DUs [distribution utilities] and ECs [electric cooperatives],” says Lotilla in a forum last week.
“This is a continuing conversation between government policy makers and regulators and Meralco, and we ought to examine with rigor the trade-offs between consolidation and competition, and whether these benefits as we speak of are realized,” adds Lotilla.
Meralco last month announced a new electricity rate hike, after an increase in the Wholesale Electricity Spot Market (WESM) prices and adjustments in transmission and other charges.
Residential consumers with an average of 200 kWh will pay an additional P0.7226 per kilowatt-hour, or P145 in their monthly electricity bill.
Meralco vice president and head of corporate communications Joe Zaldarriaga said the overall rate for a typical household rose to P13.0127 per kWh in April from P12.2901 per kWh in March, led by the higher electricity costs from the spot market.
The periodic rate increase will not be palatable to consumers. Mr. Lotilla’s admonition on Meralco is a wake-up call. Electricity rates in the Philippines can be lowered and they should not be one of the highest in Asia.
E-mail: rayenano@yahoo.com or extrastory2000@gmail.com
Tags:
Manila Electric Co., Meralco PowerGen Corp., Department of Energy, Energy Secretary Raphael Lotilla, Atimonan coal plant