DoE orders probe of possible collusion by power firms

Posted on July 30, 2016

The Department of Energy (DoE) has asked the Energy Regulatory Commission (ERC) to look into whether power plant operators are intentionally scheduling outages at the same time to bring up electricity rates.

He said the move should answer whether there was an “anti-competitive angle” and an intentional shutdown of the power plants, as well as their running below full capacity that would result in higher electricity prices.

This came after electricity reserves in Luzon thinned and fell below what is required to maintain stable supply, prompting the grid operator to declare a “red alert” and giving rise to the possibility of power interruption. Four power plants shut down yesterday while another was not running at full capacity.

Mr. Fuentebella said said the National Grid Corp. of the Philippines (NGCP) had declared a “yellow alert” and later a “red alert” from 2:00 p.m. to 4:00 p.m.

“At these times, we need to be efficient in using electricity as this happened because of deficient supply. There are plants, more than four, that did not fully run or were on forced shutdown,” he said.

He said the department was monitoring the situation after the contingency reserve ran out, leaving the system with no allocated capacity to answer any reduction in supply from the loss of the largest power generating unit — the 647-MW unit one of the Sual coal power plant in Pangasinan.

Yesterday’s red alert followed the other day’s yellow alert warning from NGCP after the contingency reserve fell below the capacity of the Sual plant.

Mr. Fuentebella said that because of the warning, distribution utility Manila Electric Co. (Meralco) had talked to participants of its interruptible load program (ILP) to start “deloading” to help reduce power demand.

Under the ILP, big load customers of distribution utilities and electric cooperatives run their stand-by generation sets in times of energy supply deficiency to prevent power outages.

As advised by Meralco, the DoE said the program was able to bring down demand by 150 MW to 170 MW as of 12:45 p.m.

The plants that were on forced outage yesterday were the 647-MW unit one of the Sual coal-fired power plant, the 122-MW unit two of South Luzon Thermal Energy Corp. (SLTEC), the 300-MW unit two of the Calaca plant and the 382-MW unit two of the Pagbilao plant.

Unit one of the Malaya plant was running with a capacity of 170 MW, or below its usual 270 MW, while unit two was at 280 MW or below its full capacity of 320 MW.