MANILA, Philippines—The Department of Energy (DOE), led by Energy Secretary Raphael ‘Popo’ Lotilla, has approved the implementation of a “gas swapping arrangement” as a “win-win solution” to the projected shortage of electricity supply from March to July this year, the peak months for power demand.
Following a meeting called by Lotilla last Dec 27, energy stakeholders and DOE officials drew up a plan to keep power supply sufficient even as demand rises.
Aside from DOE officials, among those present at the meeting were representatives of power producer First Gen, energy firm Prime Energy, Manila Electric Company and South Premier Power Corp, a San Miguel Corp subsidiary that now owns the Ilijan Power Plant in Batangas province.
Under the agreement reached at the Dec 27 meeting, the DOE and the stakeholders would:
-Implement a “gas swapping” deal that would send at least 80 SCUF (standard cubic foot) of First Gen’s Malampaya banked gas allocation to operate Ilijan
-Ensure Ilijan would generate a minimum of 400 megawatts to a maximum of 1,000 megawatts to help fill the gap from March to July which is expected as a result of an increase in demand
-Ensure that the agreement among stakeholders and DOE would help lift the economy and benefit everyone
-Shun the use of diesel for Ilijan because it would mean higher rates for consumers
-Keep the cost of power to a maximum of P4 per KwH
-Submit the gas swapping agreement to Prime Energy, now the operator of the Malampaya gas field.
Also under the agreement, the DOE will help those involved in the gas swap arrangement secure permits and hurdle bureaucratic processes at the shortest time possible. It will also ensure that Meralco sources energy at the least possible costs.
“It’s a win-win solution where no one loses but everyone benefits,” said the DOE in a statement.
DOE estimates placed the potential shortage of electricity during the peak months at up to 1,000 megawatts.
“We are here to assure the public that we are prepared and we are not going to let our people down as far as power supply stability is concerned,” the DOE said.
“We are taking this proactive stand so there would be no need for our businesses, our consumers and especially those relying on continued supply of power to worry,” the DOE official added.