Power plants in private hands contribute to rotating blackouts

Posted at 03/02/2010 12:56 PM | Updated as of 03/03/2010 7:54 PM

MANILA, Philippines – While the privatization of power plants was expected to provide efficiencies that evaded them when they were state-run, the rotational blackouts that hit Luzon on Monday proved otherwise.

Energy chief Angelo Reyes reasoned that the plants sold by the government to private groups were bound to break down soon due to old age. "Luma na ang mga ito, ang kundisyon nila ay hindi na maganda [These plants are old and not in good condition when they were sold],” Reyes told Karen Davila in ANC’s Headstart.

9 power plants offline on March 1, 2010
  • 1,200-MW Sual owned by San Miguel Energy Corporation (boiler leak)
  • 1,200-MW Ilijan natural gas plant owned by Korea Electric Power Corporation in Batangas (supply issues) 
  • 1,000-MW Sta Rita natural gas, owned by First Gen Corp (under maintenance shutdown)
  • 600-MW Masinloc (boiler leak)
  • 600-MW Calaca (maintenance shutdown)
  • 500-MW San Lorenzo plant owned by First Gen Corp (under maintenance shutdown)
  • 100-MW Binga (maintenance shutdown)
  • 20-MW Bacman 4 (maintenance shutdown)
  • 20-MW Makban 7 (maintenance shutdown)

Total: 5,240-MW

Energy supply in Luzon had already been placed in critical levels since water reserves in dams reached critical levels due to the onslaught of the El Nino phenomenon. Aside from providing water for domestic use and irrigation, dams are also used for power generation.

The energy department projected a dwindle in energy reserves as early as January when San Miguel Energy Corporation shut down two plants for preventive maintenance: the 540-MW Limay gas turbine plant and the 1,294-MW Sual coal plant.

SMEC bagged Limay and Sual plants last August 2009.

Sual unit 2 was closed down due to coal supply problems while Sual unit 1 experienced feedwater pump trouble. According to officials, SMEC supplied coal that was under coal specifications and were not used, putting Sual units off-line on January 26.

The shutdown forced the 650-MW Malaya plant to make up for the lost supply in the already thinning energy reserves in Luzon. However, the department of energy has already projected Malaya to go off-line this year as its oil stocks diminishes.

The Malampaya gas field, which supplies fuel to the1,200-MW Illijan natural gas plant being run by the Korea Electric Power Corporation in Batangas, also underwent maintenance shutdown that had been scheduled 6 years ago.

Likewise, the 1,000-MW Sta Rita natural gas and the 500-MW San Lorenzo plant, both owned by the First Gen Corporation of the Lopez Group of Companies, went on maintenance shutdown in the middle of February and will be completed by early March.

Other plants on maintenance shutdown were: 100-MW Binga, 20-MW Bacman 4, and 20-MW Makban 7.

As oil reserves in Malaya decrease rapidly and plants went on preventive maintenance shutdown in less than two months, the National Grid Corporation of the Philippines warned of possible rotational black-outs on February 16 if Limay failed to go on-stream.

Days before the anticipated blackout, Reyes announced that SMEC agreed to run Limay weeks ahead of schedule but shares that technical considerations and fuel supply issues had been hampering the running of the plant.

On the day of the blackout, SMEC and Alston Philippines signed an agreement to maintain and operate the plant, eliminating fears of power interruptions in Metro Manila.

Energy supply had been stable for 2 weeks until the sudden 2- to 3-hour rotational black-out on Monday due to the incapacity of Sual and the 600-MW Masinloc coal plant in Zambales to provide electricity to the grid.

The shutdown on Sual and Masinloc were blamed on a boiler tube leaks. Sual 1 will be online later Tuesday, while Masinloc will be online by March 7. Earlier, Sual unit 1 experienced feedwater pump trouble and was shutdown.

According Reyes, Sta Rita, which were scheduled to go on-line by March 10, will go on-stream on Tuesday to supply power to the grid. The 600-MW Calaca coal plant, which was closed down in January due to boiler tube leaks will also go on-stream later Tuesday.

As early as 2006, DOE projected an energy shortage in Luzon come 2010 but Reyes boasted of enough supplies, saying shortages will only happen at the latter part of 2010, beyond his term as energy secretary.