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Experts: reorganizing and investing more will solve the electricity problems

Power experts concur that drastic and innovative measures should be taken promptly to alleviate the Philippines’ persistent supply deficits, particularly noticeable during the dry season.

Roberto Galang, dean of the John Gokongwei School of Management (JGSOM) at the Ateneo de Manila, stated in an interview on Monday that it is time to reconsider plans to merge the power grids of important island provinces to build a bigger, more effective power distribution company.

He referred to a plan made decades ago to connect Mindoro, Palawan, and other areas of Mindanao to the national electricity system.

However, Galang claimed that this proposal had failed because provinces occasionally preferred to receive subsidies from the National Power Corporation (Napocor).

The dean continued by saying it was necessary to create a grouping of tiny power cooperatives dispersed among minor provincial towns.

They struggle to properly negotiate power purchase agreements because of the dispersed nature of their distribution network, which places them at the mercy of powerful generation firms. According to Galang, they are also vulnerable to bankruptcy and LGU political meddling.

He said the benefits of uniting the numerous power corporations dispersed around the islands outweigh the challenges, despite the evident technical challenges, such as Palawan’s isolation from the rest of the country.

“When there are blackouts, businesses and people must deal with spoilage, a halt in activities, or the need to purchase their generators. The economic cost of all of these is enormous, he continued.

Galang was responding to research by the Philippine Independent Power Producers Association Inc. that claimed every major five-hour power outage costs the national economy approximately PHP500 million.

PIPPA President Anne Estorco Montelibano stated in a newspaper article that the value of lost load (VoLL), defined as a measurement of missed business opportunities, determines the economic impact of a power outage.

The president, managing director of First Grade Holdings, and market analyst Astro Del Castillo agreed that there is a need to address the electricity deficit shortly by “whipping power companies to fast-track their power projects.”

He bemoaned that the Philippines have had a poor power supply for around 30 years.

Del Castillo asserted that greater investments are required in the power sector, notably in fields like offshore gas development.

It was recalled that since 2001, the Malampaya Deep Water Gas-to-Power project has been supplying around 35% of Luzon’s electrical needs.

According to del Castillo, also the chairman of Frontier Oil Corporation (Philippines), the long-term approach to energy security includes giving nuclear energy a serious second look.

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