Sunday, September 20, 2009

MARINDUQUE POWER OUTAGES

MARINDUQUE POWER SITUATION

SaysEnergyAustralia: ''a brownout occurs when the voltage is at half strength for more than one second'' resulting in dim lights and a shrinking picture on your TV. Dennis S. Gana, manager of corporate communications at National Power Corporation (Philippines) explains that the two terms are used interchangeably in the country.

''The term ‘brownout' is used only when the power outage is localised, involving small areas. The outages during brownouts involve only distribution lines, not generators. Blackouts are usually caused by power generators and/or power transmission systems, and they cover a wider area..” (rdasia.com, April 2009


Most people, probably, could hardly care about those terms and definitions. For as long as power outages prevent him or her from watching the tear-jerking soap opera in the evening, interrupts the barangay fiesta dance, keeps the body soaking wet without a running fan, continuously disrupts business and Internet connection. The ‘why’ of it all is more difficult to comprehend.

Is the Marinduque Electric Cooperative, Inc. (Marelco), still in good financial position to effectively address the current situation, I wonder? Recently, it pointed fingers to typhoon “Reming” (Nov. 2006), that caused a heavy toll on electrical installations; where an amount of P 42-million that should have been turned over or paid to Napocor was utilized, unilaterally it appears, for the necessary rehabilitation work that preceded the local and national elections. Then there’s this situation where the independent power service provider involved is no longer in a position to augment the necessary power supply needed for the entire province.

What is really going on?

Item: “Energy Secretary Angelo Reyes is asking Congress for some P3 billion to finance a power contingency plan to ward off a nationwide power crisis next year....Reyes said the Visayas grid has been experiencing rotating brownouts since 2008 due to very tight power generation capacity in Cebu and Panay. Mindanao is also vulnerable and is now encountering power supply problems, he added...Reyes said the Luzon grid might also encounter power supply imbalance starting next year. (Philippine Star, Sep, 18, 2009)

So, who else is having problems if we're not the only ones?

Item: “Reports are coming in that the town of San Jose has been without electricity since Thursday last week, August 13, 2009, and that it may take 4-5 more days before power is restored. Sources reveal Occidental Mindoro Electric Cooperative, Inc. (OMECO) has been experiencing mechanical difficulties as a result of a dredging operation being performed in close proximity to their power barge...” (Aug. 17, 2009)

Item: “The power outages experienced by the service area of the Albay Electric Cooperative (Aleco) have been making it hard for volcanologists monitoring Mayon Volcano’s abnormal activities to promptly send information to government agencies and the pubic..” (Inquirer.net Sept. 16, 2009)

Item: “The island of Negros is in dire need of a stable power supply says Department of Energy (DOE) Visayas Field Office Supervisor Engr. Rey Maleza. Maleza said what is being applied in Negros and Panay in terms of addressing the current power shortage is only a band aid solution. There is a need for private power investors, he said. Maleza said Negros Island becomes isolated now because of the lack of reserve power...Maleza also explained that the critical period for the power situation in the Negros-Panay grid started during summer this year where brownouts and power interruptions are experienced even up to now.” (The NewsToday Info, Aug. 28, 2008)

Item: “According to Energy Sec. Reyes, the country is on the brink of a power shortage last seen during the Aquino administration. Intermittent power outages have started in the Visayas and by next year electricity demand will outstrip supply in Mindanao, and by 2010, the critical point will be reached in Luzon”. (eccp.com, Jan. 2008)

Well that appears to be a validation that we are not alone, but a part of the whole, indeed. “Need for private power investors”, did the above report from Negros island say that?



Item: “... the windmills has become a solution to the frequent power outage experienced in Ilocos Norte since the province is located at the end of the power grid coming from Bauang, La Union -a province several miles away from Ilocos Norte... Officially known as the NorthWind Bangui Bay Project, it is the first Wind Farm in the Philippines.” (traveleronfoot.wordpress.com, June 10, 2009).

What’s being done then about the Marinduque power situation?

Napocor, in a letter dated Sept. 4, 2009, to Marelco General Manager Eduardo Bueno, has inquired about the status of the privatization of power generation in Marinduque, and the level of energy that will be nominated to Napocor for 1910. Napocor’s concern is “the long delayed entry of your NPP” (New Power Provider). As Napocor units “are aging and the capabilities are diminishing” we may experience more brownouts unless Marelco and a new power provider are able to replace Napocor’s units.

(Photo: The power barge at Balanacan: aging, capability diminishing)

So, it’s privatization of power generation being pursued pala.

In his last State of the Province Address, Gov. Bong Carrion said, thus,:
“The existing contract between Napocor and Marelco where we are at the mercy of Napocor is no longer tenable. I have requested Gen. Sarmiento to sit down with Sec. Angelo Reyes and find available means to address this situation, as two foreign companies and one local company have already expressed willingness to invest in Marinduque using renewable energy sources” (SOPA, Aug. 14, 2009)

Got hold of Napocor’s letter to Marelco. It reads as follows:

National Power Corporation
Quezon Ave. cor BIR Road, Diliman, Quezon City, Philippines

04 September 2009
Mr. Eduardo Q. Bueno
General Manager
Marinduque Electric Cooperative, Inc.
Ihatub, Boac, Marinduque

Subject: Privatization of Power Generation

Dear GM Bueno:

The NPC-SPUG, in its preparation of the 2010 Budget Proposals, would like to know the status of the privatization of power generation in your area, and the level of energy that will be nominated to NPC for the period.

As you had opted to have your own New Power Provider during the 2004 consultation with the Department of Energy, in the promulgation of its Circular No. 2004-01-001, NPC-SPUG’s function has been limited to the maintenance of its existing capacity. NPC’s budget does not allow any provision for increase capacity, since any additional requirements shall have to be provided by your NPP.

Our present concern is the long delayed entry of your NPP. NPC’s units are aging and the capabilities are diminishing; without the expected augmentation from your NPP, and with your load continuously increasing, we may have deficit in capacity unless the cooperative and its NPP setup appropriate capacities to replace NPC’s units.

Hence, we would like to urge the cooperative to fast track their undertakings with their New Power Provider and more decisively in its privatization endeavor.

The Privatization of power generation does not end our mutual concerns on providing electricity service, it even calls for more cooperation as we have to guide and assist the new entrants to ensure a sufficient power service.

We hope to hear from you soon, as we had apprised you of our concern.

Very truly yours,

(Signed)
Melburgo S. Chiu
Vice President
SPUG/WMD/DRFFD


(More time now then, on the beach, under the soothing shade of coconut trees)

11 comments:

David B Katague said...

Eli, thank you for the update on this subject. Now, I know why I received so many e-mails from all over the Philippines complaining of brownouts. I hope Richard, one of your readers read this posting and understand that Marinduque is not alone in this problem. I hope that private investors seriously consider investing on the windmill or solar energy projects in Marinduque. So privatization is the answer? Perhaps?

eli j obligacion said...

Thanks Dave. It is probably not unusual, in a sense, that some think of Marinduque as a separate country...

richard said...

you can consider marinduque as a separate country "electricity wise" because marinduque dont belong to any of the national power grid. it is a very stu--- excuse to say that because other areas are having power shortage then its ok for marinduque to experience the same....so Filipino mentality, no wonder marinduque remains poor.

eli j obligacion said...

Point is, Richard, Marinduque cannot claim to be the "brownout center of the Philippines" as you would have it, as stated in your earlier comment, for which many thanks. There are too many other possible claimants. That's the context of the statement made.

Report will follow on the public hearing conducted by SP on the issue with Marelco, Napocor, board members and general public in attendance.

Have a nice day!

Ninay's Tikoy said...

hi kuya eli,the best way is to help MARELCO find ways to terminate the contract with their NPP. I dont agree with you that an NPP is a solution but we are one with the idea that MARELCO should terminate its contract with 3i. The board or directors are selling their half truths that their case of terminating the contract is weak and they are being cautious citing the ROmblon case when in fact it was dismissed because they filed it at ERC and not with the regular court. I am really frustrated already. I want to get hold of the contract to have my lawyer-friends look into it.If you have a copy you know where you can find me.Thanks

Joe said...

I am no lawyer but base on what I've seen on our local channel I believe that there is a wrong decision on MARELCO's part in extending the deadline for the operation of 3I powergen. Since one of their (MARELCO) directors admitted that representatives of 3I told them that they (3I POWERGEN) cannot supply electricity to Marinduque. Why should they extend the contract. Extend it for what? Please Mr. Obligacion enlighten us on the situation. Every thinking individual will cancel any contract ones the contractor could not produce the service or the item. Why the need for extension? Im just asking.

Ger said...

After one and a half week on the island, with the frequent brownouts/blackouts or whatever I surely do understand the need for a reliable power supply. Being busy setting up an business in renewable energy GGE (Grarado Green Energy). I have now organised enough land and farmer cooperation with FOMMCO to start-up a pilot project, resulting in an power supply of a total of 14 MW in the course of a 5 year development of multiple distributed power stations.
Although the main objective of the program is the harvesting of vegetable oils for export, the electricity generation is a much welcomed by-product. Any one with an interest in getting the power supply established on Marinduque is invited to contact me how we might speed up the process of getting the power supply up and running

eli j obligacion said...

Hi Guys!
Truth is, I was in the dark just like most everyone else in this matter, because the reasons for this mess that have been spread around by the center of the controversy - Marelco - was that it's all about utang, lumobong bayaran, lugi, etc, etc. Then I got hold of the Napocor letter that I posted here and took that as a lead.
I was one among the audience during the SP hearing last Sept. 30 but was requested to sit down with the board members. I made a statement there about the lengthy "band-aid" solutions and nothing about the long-term; also inconsistencies in Marelco pronouncements during the hearing. There they stated that Marelco board has issued a "resolution of termination" to rescind the contract and that 3i Powergen was bankrupt. When I asked the manager to explain why, instead of replying squarely to the Napocor letter and inform Napocor of these developments, Marelco decided to approach 3i Powergen through a letter, for the latter to do the explaining, with mere copy of said letter furnished Napocor. Where's the sense of urgency and responsibility there? The manager replied like Pilosopong Tasyo: "I asked them because I don't even know of their plans.. and Marelco has yet to pass that resolution". Such.
No, I never expressed any opinion that NPP is a solution. I merely stated my finds. NPP (now IPP_ entry is national government policy apparently.
At the energy summit, I conveyed my new find that 3i Powergen is not registered with SEC (they merely reserved their company name- meaning all these years from 2005-2009 all they did was to renew their reservation for use of that name???). Not being a lawyer, I thought that info could be used to consider the contract null and void from the beginning since 3i did not have the legal personality to sign such a 'powerful' contract. The Marelco lawyer appeared to brush it aside, the chair stated the company's existence under the law of the Philippines is stated in the contract to which I asked, "what if they are not, nga?"
But we all have to realize that Marelco is under the jurisdiction and control of NEA and not an independent organization. (see Part 2 of my Power post). NEA delas with power, govt owned Napocor deals with power, who else?
Even as the Summit chair, BM Bong Raza tried to present Marelco as an independent org, going as far as comparing the independence of Marelco to the "independence of Marinduque State College" where the Summit was held. The Marelco VP explained lengthily that they were not in a position to refuse to sign the 3i Powergen contract because it had undergone a process "bago inilatag sa amin".
I say there are more surprises to come as the plot thickens.

eli j obligacion said...

Hi Guys!
Truth is, I was in the dark just like most everyone else in this matter, because the reasons for this mess that have been spread around by the center of the controversy - Marelco - was that it's all about utang, lumobong bayaran, lugi, etc, etc. Then I got hold of the Napocor letter that I posted here and took that as a lead.
I was one among the audience during the SP hearing last Sept. 30 but was requested to sit down with the board members. I made a statement there about the lengthy "band-aid" solutions and nothing about the long-term; also inconsistencies in Marelco pronouncements during the hearing. There they stated that Marelco board has issued a "resolution of termination" to rescind the contract and that 3i Powergen was bankrupt. When I asked the manager to explain why, instead of replying squarely to the Napocor letter and inform Napocor of these developments, Marelco decided to approach 3i Powergen through a letter, for the latter to do the explaining, with mere copy of said letter furnished Napocor. Where's the sense of urgency and responsibility there? The manager replied like Pilosopong Tasyo: "I asked them because I don't even know of their plans.. and Marelco has yet to pass that resolution". Such.
No, I never expressed any opinion that NPP is a solution. I merely stated my finds. NPP (now IPP_ entry is national government policy apparently.
At the energy summit, I conveyed my new find that 3i Powergen is not registered with SEC (they merely reserved their company name- meaning all these years from 2005-2009 all they did was to renew their reservation for use of that name???). Not being a lawyer, I thought that info could be used to consider the contract null and void from the beginning since 3i did not have the legal personality to sign such a 'powerful' contract. The Marelco lawyer appeared to brush it aside, the chair stated the company's existence under the law of the Philippines is stated in the contract to which I asked, "what if they are not, nga?"
But we all have to realize that Marelco is under the jurisdiction and control of NEA and not an independent organization. (see Part 2 of my Power post). NEA delas with power, govt owned Napocor deals with power, who else?
Even as the Summit chair, BM Bong Raza tried to present Marelco as an independent org, going as far as comparing the independence of Marelco to the "independence of Marinduque State College" where the Summit was held. The Marelco VP explained lengthily that they were not in a position to refuse to sign the 3i Powergen contract because it had undergone a process "bago inilatag sa amin".
I say there are more surprises to come as the plot thickens.

eli j obligacion said...

GER, very interesting post. Will inform those concerned about it. Thanks.

Ger said...

And to give some more info: Grarado Green Energy is registered with the SEC and the DOE. So if Marelco is willing to look for another energy provider... there is one available.
Besides this, there are plenty of opportunities for improving the electrical system on Marinduque with the help of the Dutch government. I am sure there will be interest in this program.

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