Solar power plants can augment the country’s power supply, especially during times when demand for electricity is at its highest.
In a virtual briefing, Institute for Climate and Sustainable Cities (ICSC) Senior Policy Advisor Pedro Maniego Jr. said solar power plants can augment the projected increasing demand in Luzon from 2022 onwards.
Maniego noted the economy is expected to improve next year. “We are vaccinating our people so there will be higher demand,” he said.
“If you have enough solar, they could be more than enough to augment the supply requirement during these times,” said Maniego, former chairman of the National Renewable Energy Board, the bureau guiding the Department of Energy in implementing renewable energy policies.
“Solar is not available 100 percent of the time but these deficit in supply is during the peak hours, which is normally from 10 a.m. to 2 p.m. and solar plants produce higher generation during these times,” he added.
Last week, the Luzon grid suffered rotating brownouts caused by thinning supply as many power plants are offline or operating at de-rated capacity.
ICSC advisor Alberto Dalusung 3rd said the issuance of red and yellow alerts, normally every second quarter of the year, is a “perennial problem.”
“Given the current state of our supply mix, it (the grid) cannot have new capacity that soon. We probably have to look ahead and see how we can deal with the same problem next year,” said Dalusung, former director of the Department of Energy and currently an NREB member.
Replacing existing coal-fired power plants with new ones within a year is not a viable option. “You can’t just replace a coal plant with another coal plant in a year so we need to think of solutions in terms of quick to deploy power plants,” he added.
Dalusung noted the “cheapest and quickest” to deploy are solar and wind power plants since it would take up to one year to complete the construction of such renewable facilities.
“Unlike coal and gas power plants, solar and wind power plants do not have fuel and thus no automatic pass-through of fuel costs that make actual coal and gas power costs much higher than their ERC (Energy Regulatory Commission)-approved base rates,” he said.
Maniego said proponents are prepared to build solar and wind power plants, but funding remains a challenge because banks won’t provide loans to such power facilities without entering into a power supply agreement.
“Our banks will not give you loans unless you have a PSA and it’s difficult to get. It’s good that Meralco (Manila Electric Co.) has now entered in a big contracts for solar but that is only a recent development,” he said.
But Financial Futures Center founder Sara Jane Ahmed pointed out there is a market case already for merchant power plants.
“We have WESM (Wholesale Electricity Spot Market) where you can sell power to and we have power supply issues and if you look at how long it takes to approve a PSA, its likely that our installations will continue to be delayed in the foreseeable future unless something drastically changes with the regulators,” Ahmed said.
“This is where the banks can come in, the investments can come in and set up merchant power plants to deal with this scenario,” she added.