Another summer of discontent? Brace for ‘tight supply blues’ and surging electric bills

Summer is always associated with having high energy for much-awaited adventures and leisurely basking in the sun, but what’s lurking in the dark is the sting of skyrocketing electric bills as well as discontent of ‘tight power supply blues’ that could descend into worse scenarios of service interruptions or even rotating blackouts.

If reckoned on the power supply-demand outlook issued by the Department of Energy (DOE), there are no projections of ‘yellow’ and ‘red’ alerts within the stretch of the summer months (from March to June) – entailing then that reserve margins are well provided for in the power system. And through that lens, rotating blackouts are not supposed to happen – well, ideally, but reality might still turn complicated and troublesome.

The energy department indicated that it so far factored in forced outages of power plants, new capacity additions from greenfield and brownfield facilities; extreme de-rating or roughly zero generation of the hydro plants; then export of capacity from the other grids in its overall assumptions.

Nevertheless, the DOE has always been forthright in asserting that with the El Niño-saddled summer months, probabilities of tight supply predicaments could still distress Luzon grid, which is also the country’s main economic center.

And while the scorching weather overwhelm consumers, their typical sanctuary will be to shield themselves with longer run of their air-conditioning units – that in turn, will trigger their electric bills to skyrocket.

To taper off the impact of the energy-guzzling summer period, Energy Secretary Raphael P.M. Lotilla already advanced an appeal to households and businesses “to contribute to the judicious use of energy and accelerate energy efficiency and conservation efforts amid El Nino.”

According to the DOE, the El Nino phenomenon could increase ambient temperatures and heat index by one to two degrees – hence, that will prompt energy demand to rise correspondingly during the dry months, consequently causing stress on available supply in the power system.

“As we face the challenging period where we would need the support of everyone, we must therefore be conscious in our use of electricity,” the energy chief stressed.

Updated 2024 Power Supply-Demand Outlook: Luzon Grid (Source: DOE)

In the updated outlook of the DOE, it fleshed out ‘critical points’ that could push the power system to breaking point if the warranted solutions will not be set on stream as they are needed – including reliable operation of the Hermosa-San Jose transmission line that is expected to deliver available capacities from Bataan to major load centers in Metro Manila plus nearby areas in South Luzon.

Additionally, it was specified that Visayas grid will be “relying heavily on the HVDC (high voltage direct current) importation from Mindanao;” and there is also high expectation for system operator National Grid Corporation of the Philippines (NGCP) “to ensure the integrity and reliability of the grid at all times.”

Further, the DOE has directed key industry players, primarily NGCP and the generation companies (GenCos) to adhere to the approved Grid Operating and Maintenance Program (GOMP) – or to strictly follow the schedule of the routine maintenance of their electric generating units as well as on when these shall be synchronized back to the grid.

For project sponsor-companies that are already advancing their facilities into commercial operations, they are reminded by the DOE “to ensure that their committed power generation projects will meet target CODs (commercial operations dates).”

In parallel, power utility giant Manila Electric Company (Meralco) conveyed that for it to help ease ‘supply mess’ in the grid, it already advanced call on its large power customers to participate in the government-underpinned interruptible load program (ILP), or that set-up which will require these companies to switch on their self-generating units when power supply would run tight in the grid.

Meralco Vice President and Head of Corporate Communications Joe R. Zaldarriaga said “we are banking on the support of large load consumers within the Meralco franchise area to embody the spirit of bayanihan and join the ILP. As we have experienced in the past, the program has been beneficial in ensuring continuity of service even when supply is tight.”

The utility firm emphasized that it already has 103 companies with 528 megawatts of de-loading capacity across the Meralco franchise area that are enrolled in the interruptible load program.