The Luzon grid faces a “challenging” situation next year as the power supply is expected to remain tight and electricity prices are forecasted to go up, an industry executive said over the weekend.
“I think 2023 is most challenging, more than 2024. Because [in] 2023, LNG is not ready. 2024, we are ready, so no brownout, but prices may be higher…That’s my read,” Semirara Mining & Power Corp. chairman Isidro Consunji said.
He said there would be power shortage in case a power plant would go offline in the middle of the dry months. Historically, demand goes up during the dry months as most establishments and households switch on their air-conditioning units more frequently.
“There may not be enough… [supply]. We have to watch the [electricity] prices,” said Consunji, whose company is involved in coal mining and power generation.
“The highest price is not April and June, April and May. It’s June and July,” Consunji said.
SMPC subsidiary SEM-Calaca Power Corp. owns and operates the 600-megawatt coal-fired power plant in Calaca, Batangas, which it acquired from the government. Southwest Luzon Power Generation Corp. owns a 300-MW coal plant within the Calaca facility in Batangas.
Grid operator National Grid Corp. of the Philippines placed the Luzon grid on red and yellow alert for several hours on Nov. 28 and Dec. 1 because of thin power reserves.
Energy Secretary Raphael Lotilla said the Department of Energy was preparing contingency measures as it expected supply to be tight during the dry months.
“Our foremost concern is to ensure that there is enough capacity supplied through various sources, most especially in the coming summer months, to sustain the power supply in the country,” Lotilla said.
The energy secretary said imported natural gas would help diversify the country’s power sources.
“Given its scheduled availability at the end of the first quarter of 2023, liquefied natural gas is considered an important source for fuel diversification. This will complement ongoing efforts of the Malampaya consortium to optimize sustainably the remaining indigenous gas in the Malampaya-Camago reservoir,” Lotilla said.
Based on the progress reports provided by the LNG project proponents to the DOE’s Oil Industry Management Bureau, Linseed Field Power Corp. of AG&P was on track to complete its first integrated LNG import terminal in Barangay Ilijan in Batangas City.
The DOE said the commissioning of the Linseed LNG project was scheduled for March 2023 and the commercial operation would be in April 2023 in time for the arrival of LNG supply for the 1,200-MW Ilijan combined cycle power plant.
FGEN LNG Corp., a subsidiary of First Gen Corp., with BW LNG providing LNG storage and regasification services, is also scheduled to commission its LNG terminal in March 2023, while the commercial operation is set in June 2023.
This will coincide with the arrival of LNG supply to fuel First Gen’s gas-fired power plants such as the 1,000-MW Sta Rita Power Plant, 500-MW San Lorenzo Power Plant, 414-MW San Gabriel Power Plant and the 97-MW Avion Power Plant.