5 Mindanao cities virtually in the dark by 2014; Aboitiz eyes coal-powered plant as solution

October 28, 2010 10:30 am 

By Lovely A. Carillo

DAVAO CITY, Oct. 27 — Five major cities in Mindanao including General Santos, Davao, Zamboanga, Cagayan de Oro and Butuan will be in darkness in five year’s time if the projection of a power and demand shortfall of 484 megawatts between 2010 and 2014 comes true.

This could mean up to six hours or more of rotating brownouts for the five cities during the dry season.

However, there is a way to prevent this from happening if the Mindanaoans agree to the putting up of a coal-powered plant.

“Mindanao will be facing a continuing and debilitating power crisis unless new power plants are built to cover the shortfall,” so says Erramon Aboitiz, President and Chief Executive Officer of Aboitiz Power.

AboitizPower made the same warning when it was about to put up the recently-completed Hydropower Plant in Sibulan, Davao del Sur which can provide up to 42.5 MW (megawatts).

The Hedcor hydropower plant was lauded by President Benigno Simeon Aquino III when he inaugurated the plant during his first visit to Davao City last month.

While the hydropower plant encountered problems mainly due to a conflict with the Davao City Water District (DCWD) over the issue of who has better right to use the city’s water resources, having the hydroplant in the city has become palatable mainly because it is a renewable and sustainable source of power after all.

Hydroplants are however highly vulnerable to weather conditions, which means, when there is drought or dry spell, the hydropower plant becomes unreliable. Take the case of the Angus and Pulangui hydropower plants which failed to provide power to Mindanao when the water dried up due to the recent El Nino or long dry spell.

Mindanao Power Crisis

To solve the problem Aboitiz Power is bent on constructing a “circulating fluidized-bed coal plant within Davao City which will significantly reduce our dependence on hydropower.”

“Coal costs substantially lower than fuel oil so a coal-powered plant will have significant and favorable impact on electricity rates,” he said.

The project is a highly ambitious and expensive one, but Aboitiz said they are prepared to take the cudgels for building the plant even without bilateral contracts with wholesale buyers of electricity due to the urgency of the need, Aboitiz said they have not yet identified any area for the plant.

“This could be the largest investment in the city,” he said, at a cost of up to 400 million dollars or roughly P15 billion. It is expected to provide employment to at least 200 people, and produce up to 200 MW for the city.

The company executives headed by Aboitiz have met with Vice Mayor Rodrigo Duterte and members of the city council even before they announced their plans to the media.

The Vice Mayor, who seemed convinced about the urgency and importance of the coal-powered plant proposed by Aboitiz, said he will always welcome initiatives that will help improve power supply in Mindanao since a more stable power supply will make the city more attractive to investors.

However, Mayor Sara Duterte-Carpio refuses to be impressed by the Aboitiz-proposed coal-powered plant. The Mayor, who earlier declared that she will always prioritize the protection of the environment when confronted with the Hedcor-DCWD issue, advised the company to present their proposal to the council and to the people.

Earlier, Duterte-Carpio said such project, like mining, will only “bring more problems than benefits and solutions since it will have a long term effect on the environment.” The Mayor has instead urged the company executives to look for alternative sources of power (like a wind farm) or an alternative location for the coal-powered plant.

Aboitiz said it is but logical to locate the coal-powered plant in the city since “Davao is the biggest user of power in Mindanao–so it is best that the city build sufficient power plants to ensure the security of its power supply.”

said the project can be ready by middle of 2014 if they start construction soon. The project is expected to take up to 40 months including the 6-month period for finding a location and procuring the necessary permits, plus 36 months for construction.

Coal plants

—> powered plants have been used by other countries, including the United States which started using coal for power in 1880, as a reliable source of power. The plants usually make use of coal chunks which are then crushed and made to undergo the combustion process.

The burned coal produces heat that generates steam which is then used to move the power-generating turbines. Coal accounted for 55 percent of the generated electricity in the US in 1995.

The technology is not new to the country as there are at least nine listed coal-powered plants in the Philippines, 6 in Luzon, 2 in the Visayas and 1 in Mindanao.

The 305 million-dollar Mindanao Coal Plant operated by STEAG in Misamis Oriental commenced in 2006 (constructed in 3-years time) after the Department of Energy projected an 850MW shortfall in Mindanao’s power between 2006 and 2014. The plant produces 232 MW.

The STEAG website claims that the Mindanao Coal Plant, which was constructed under a Build-Operate-Transfer or BOT scheme, provides 20 percent of the total power supply in Mindanao. It is saddled by a 25-year contract which requires the company to deliver the power it generates to the National Power Corporation (Napocor).

In 2007, Aboitiz Power bought 34 percent share of the Evonik Industries AG, which is in turn the majority shareholder of STEAG State Power, Inc. with a 55-percent share. German-based Evonik operates in 100 countries, is an expert in power generation and is known as the 5th largest power producer in Germany.

A 200-MW coal-powered plant worth 450 million dollars is also being built in Maasim, Sarangani by Conal Holdings. The Kamanga Power Plant, which is a joint venture between the Alcantara Group and Thailand power firm Electricity Generating Plc EGCO.BK, is expected to become operational by 2011.

Environmental implications

—> Despite the large amounts of electricity generated by most coal-powered plants at a generally lower cost, scientists are still wary about such projects because of its possible effects on the environment. A group of scientists stationed in Cambridge, Massachusetts emphasized the effects of coal-powered plants in terms of air pollution, waste generation, fuel supply and water use.

The burning of coal is expected to result to the emission of acid rain and smog which can further add to global warming and climate change problems.

Scientists claimed that in one year, a typical coal-powered plant will generate 2.3 million tons of carbon dioxide, 10,000 tons of sulfur dioxide which results to acid rain, 500 tons of airborne particles that can aggravate asthma and can cause chronic bronchitis, 170 pounds of mercury and 225 pounds of arsenic that can possibly cause cancer.

A coal-powered plant can also yield 10,200 tons of nitrogen oxide which would be tantamount to the NO2 emission of about half a million old cars. Coal-powered plants will also generate sludge, ash and toxic chemicals. But more than that, the plants will need billions of gallons of water, the scientists said.

Scientists said at least 2.2 billion gallons of water is needed by a 500-MW coal-power plant every year to create steams for its turbines. The same amount of water can already support the requirements of 250,000 people.

Coal-powered plants are expected to leave lots of carbon footprints since the coal will be mined, transported and stored. In the case of Davao, Aboitiz suggested Kalimantan in Indonesia as a possible and proximate source of coal for the plant.

Aboitiz however assured the Dabawenyos that “coal fuel generation has now become greener because of new technologies that are cleaner and more efficient.” He said the old image of coal as a high polluting power source is based on old technology.

“Aboitiz Power guarantees that the operations of this coal plant will meet stringent international and the Philippines’ environmental, safety and health standards,” he said.

Mindanao needs new power sources because of its growing requirement for power. Coal plants have proven to be reliable power sources for years unlike hydropower plants which are reliant on weather conditions. And with the company’s promise of more stable and cheaper electricity, a coal-powered plant might be the answer to Mindanao’s power problems.

Then again, considering the environmental degradation that are part and parcel of developments like this, building a coal-powered plant might not be as simple as it looks at all. (PNA) LOR/Lovely A. Carillo/lvp

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