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Major delays before commercial launch seen in 27 power projects

TWENTY-SEVEN committed power projects with capacity equivalent to 2,045 megawatts (MW) have faced setbacks to reaching commercial launches since 2016, the Senate Committee on Energy said Thursday, adding that further delays may compromise the power supply.

Facilities, including those targeted to begin commercial operations this year, account for 71% of the committed projects which had been due to go live five years ago, according to Senator Sherwin T. Gatchalian, who cited data from the Energy department.

Committed projects are those that have achieved financial closing with investors or bankers.

“They were supposed to be online a long time ago. Some were delayed twice, some three times. If projects are delayed, we will have problems in supply and planning will get thrown off,” Mr. Gatchalian, who chairs his chamber’s energy committee, said during a hearing Thursday.

“We’re very happy that we have committed plants but if the plants do not come on time, then definitely we’ll have brownouts,” he added.

One of these plants, which was delayed five times, is the 668-MW Unit 1 of the GNPower Dinginin coal-fired power plant.

“We will call all these plants to a meeting to give us the details on how we can fast-track all of these. We have to know the details of where the problems are specifically and we will also guide them on what mechanisms to use — whether its EVOSS (Energy Virtual One Stop Shop system) or any other mechanism that the DoE can utilize,” Energy Undersecretary Felix William B. Fuentebella said.

Mr. Gatchalian also noted the plants which cannot provide power to the grid because they are undergoing testing and commissioning.

The Philippine Independent Power Producers Association (PIPPA) and the market operator indicate that 12 coal, solar, diesel and biomass-run power facilities with a capacity of 1,154.6 MW are still in the testing and commissioning phase as of June.

The Luzon grid underwent a series of red alerts that month which triggered rotational brownouts in parts of the island after forced plant shutdowns, which thinned reserve levels, while higher temperatures drove up demand.

During the hearing, groups representing power producers and developers said that they had no incentive to deliberately halt operations at their plants, saying that this did not make business sense.

“We’re businessmen. We don’t have no motivation to go on outage because going on outage means no business for us. When (our plants) are down, we don’t make money,” Anne Estorco-Montelibano, president and executive director of PIPPA, said, in response to a question about possible market collusion to restrict supply and drive prices up.

“In our contracts, we have to buy replacement power from the WESM. It’s our obligation to procure the power we lost…Really, (this is a) disincentive for us to go on outage; we would rather keep on running,” she added.

Jay M. Layug, president of the Developers of Renewable Energy for Advancement, Inc. said that there is “no business reason” for any power plant to deliberately shut down.

“It can be easily seen in the spot market. All energy must be bid (out) in five (minutes). If collusion is going on, the generators are going to call each other every five minutes. It does not make sense operationally,” he said. — Angelica Y. Yang

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