Just recently, President Rodrigo Duterte inaugurated the 420-megawatt (MW) Pagbilao power plant, a coal-fired facility aimed at boosting energy supply in the Luzon grid.
Duterte lauded the opening of the $976-million power facility, which, aside from providing steady power supply, would also enhance the business climate, not only in the Quezon region but the whole country, as well. It is expected to generate billions of pesos in revenue for the national and local governments in the coming years.
The power plant’s big bosses are Pagbilao Energy Corp., a joint venture between TPEC Holdings Corp. and Therma Power Inc., which are subsidiaries of TeaM Energy and AboitizPower, respectively. They boast that, even if the plant is fueled by coal, which many experts consider harmful to the ecosystem, it is “cost effective and complies with environmental standards.” They said the plant is equipped with a flue-gas desulfurizer designed to ensure compliance with environmental regulations.
Worldwide, the clamor is huge for the development of environment-friendly energy sources, which leave little or no carbon footprint at all. In the Philippines, reliance on unsafe sources of energy is slowly being shunned for nontraditional sources, such as wind, solar and geothermal, among others.
In fact, in August of last year, the President inaugurated the Solar Philippines Factory in Santo Tomas, Batangas, which enabled solar panels to become accessible to the average Filipino consumer and effectively placed our country as a major player in the global renewable energy revolution.
Solar panel costs have fallen 90 percent over the last decade, and 50 percent in the last three years alone, encouraging countries like China and India to get the majority of their new power requirements from renewables. Bloomberg estimates that construction of 86 percent of planned coal plants globally will be canceled, given the new economics of solar prices.
On the pipeline is another energy project in Pagbilao, Quezon—the Liquified Natural Gas (LNG) Hub Receiving Terminal—which is a 650-MW combined cycle gas-fired power plant.
Australian-based Energy World Corp. (EWC) said its liquefied natural gas terminal, now 90-percent complete, is set to become a hub of LNG distribution around the country once it becomes fully operational. In a report to the Australian Securities Exchange, the company revealed that the facility would be capable of handling 3 million metric tons per annum of LNG. Its first tank could support 3,000 MW of gas-fired power plants. “This will support our adjacent 650 MW combined cycle gas fired power plant, and provide expansion options for both EWC and its third-party gas clients,” the company explained. It said the deep water jetty of the terminal can handle all sizes of LNG vessels.
EWC got the Energy Regulatory Commission’s approval to develop a point-to-point transmission facility to connect its 650-MW combined cycle gas plant to the power grid. The regulatory agency allowed EWC to develop the P694-million transmission facility to connect its power plant to the New Pagbilao Station of the National Grid Corp. of the Philippines.
I was told that it has now reached an advanced stage of construction for both the LNG Hub Terminal and the Power Station. The LNG Hub Terminal, the first of its kind in the Philippines, can process 3 million tons of LNG per annum, which is sufficient enough to generate up to 3,000 MW of gas-fired power plants, and with the second tank currently being constructed, up to 6,000 MW of power. The project costs over $750 million of direct investment in the Philippines, and has created over 800 direct jobs during the construction period. The project signifies that the country will now be able to gain access to clean and affordable fuel for power generation and further develop its gas infrastructure. It can commission the first 200- MW unit of its gas-fired power station in six months after the drawdown of funds from the company’s policy bank lenders (the Development Bank of the Philippines, Land Bank of the Philippines and Asia United Bank), with the 400 MW and 650 MW at three-month intervals thereafter.
Globally, the natural gas “revolution” is the “in” thing. One of the reasons natural gas is called “clean” is its ability to emit 50 percent less carbon dioxide than coal when burned. Experts see this as a sort of “bridge” fuel until zero-carbon-producing renewables can take over.
Natural gas is also a fossil fuel, but cleaner and more efficient than other traditional fuels. It produces less pollution and greenhouse gases than its counterparts, according to the Center for Liquefied Natural Gas. For example, when natural gas is burned, it produces 45 percent less carbon dioxide than coal, 30 percent less than oil and 15 percent less than wood. During combustion, it produces heat, water vapor and CO2. It is, likewise, cost-effective and plentiful. For instance, 67 percent of Canada’s natural gas comes from Alberta. Natural gas, although not as clean as wind or solar power, is the cleanest fossil fuel. It has been deemed by experts as a key ingredient to the successful transition of the world to a cleaner future. Experts note that appliances, vehicles and power plants are highly efficient when powered by natural gas. This high efficiency makes natural gas a cleaner energy option. The Philippines can expect these benefits once the project commences full production.
EWC Price at posting:
19.5¢ Sentiment: Buy Disclosure: Held
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