THE VOICE OF BUSINESS IN NORTHERN MINDANAO

Tuesday, September 21, 2010

‘Green’ energy’s promise is just that, a promise

from: Malaya

‘Ccoal plants, while posing a long-term threat to the environment,
are necessary to develop Mindanao’s full economic potential.’

IT was the take-charge thing to do, President Aquino directing the energy department to come up with a "road map" toward adequate power supply for Mindanao when he visited the region last week. It turned out, however, that businessmen already have a good understanding of what ails the power business in the region. More important, investors have started to put money into new generating plants. It’s the half-hearted government support for the undertakings that has stymied efforts to put an end to island-wide rotating brownouts.

Ralph Paguio, chair of the Cagayan de Oro City Chamber of Commerce, said the need is to put up additional generating capacity to wean Mindanao from its heavy dependence on hydroelectric plants. Hydro power is cheap but unreliable because of climate and environmental changes that affect the rainfall pattern and the carrying capacity of Lanao Lake.

"We would prefer that we have the right generation mix – hydro, fossil fuel, geothermal and other renewables – for our power mix," he added.

Aquino apparently got the message. But only half of it sank in. In his instruction to energy officials, he said the focus should be on renewables such as wind farms in Camiguin and Davao del Sur, solar panels in isolated communities and mini- and micro-hydroelectric plants where there is adequate water run off.

These "sexy" and "appropriate" technologies, however, are as subject to the vagaries of nature as the Agus and Polangui hydro plants are. These could not assure a stable supply yearend.

It is here where base plants – big generators that run 24/7 – come in. Unfortunately, the most efficient base plants using current technology are fueled by coal.

The Aboitiz group is planning to put up a 150- megawatt coal-fired plant to supply its distribution franchise in Davao City, the region’s economic center. It is understood that the only thing that holds back Aboitiz from pursuing the project is the worry that it might run into problems with extremist environmental activists.

The Aboitiz Group does not want to go the way of the Alcantara Group whose much-delayed 200 MW coal-fired plant in Sarangani is being opposed by a Church-led hodge-podge of environmentalists.

San Miguel Corp., which is in the midst of an ambitious diversification from its food and beverage business, has bought a number of coal mines in Mindanao. The mines are capable of supplying the fuel needs of new plants with a combined capacity of up to 1,200 MW that San Miguel is seriously thinking of putting up.

These three projects alone can assure adequate power supply of Mindanao for the next decade. What is needed is a declaration from the government that, yes, coal plants, while posing a long-term threat to the environment, are necessary to develop Mindanao’s full economic potential.

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