Marcos refutes “artificial power crisis” claims, vows action to address high costs

Amid the recent yellow alert in Luzon and Visayas grids, President Ferdinand R. Marcos, Jr. addressed concerns regarding the power situation in the Philippines, debunking claims of an artificial power crisis and attributing the increased demand to extreme heat caused by El Niño.

In a BusinessWorld’s recent report, Marcos emphasized that the ongoing power crisis is not artificial but rather due to overloaded power systems. 

Acknowledging the strain on the power supply, he highlighted the need to find ways to avoid high electricity costs. He stated that the government would continue to endorse projects by the National Grid Corporation of the Philippines (NGCP) to expand transmission line coverage nationwide.

According to NGCP, yellow alerts were raised in both the Luzon and Visayas grids due to thin operating margins, with several power plants experiencing forced outages. Despite available capacity exceeding demand, the ongoing forced outages have disrupted the power supply.

On Monday, Luzon and Visayas grids’ available capacity was at 14,952 megawatts (MW) and 2,835 MW respectively, while the peak demand forecast was 13,893 MW and 2,596 MW. 

Since 2023, four power plants have been on forced outage, with four more between the first quarter of 2024 and 13 this month. Meanwhile, one plant is running on derated capacity.

Terry L. Ridon, a former lawmaker and a public investment analyst, stressed that overloading is also driven by unexpected power shutdowns of several power plants connected to the national grid. He urged the government to implement specific summer protocols or fixed-price contracts to mitigate reliance on the spot market and avoid power cost hikes, especially with increased reliance on the spot market.

The depletion of the Malampaya gas field by 2027 poses a threat to energy security, prompting discussions on boosting grid connectivity through submarine cables. In response, Marcos asserted that the administration views enhancing grid connectivity via submarine cables as a remedy for power issues nationwide.

Meanwhile, Manila Electric Co. (MERALCO) warned of a possible power rate hike in May due to higher demand and pressure on the spot market. 

MERALCO Spokesperson Joe R. Zaldarriaga cited increased demand as a key factor contributing to potential rate hikes.

Manuel V. Pangilinan, Meralco’s Chairman, and Chief Executive Officer, stated the nation’s need for conventional power plants to enhance grid capacity and reduce dependence on coal to eventually turn to the Interruptible Load Program (ILP).

Despite the moratorium on new coal-fired power plants, existing coal plants remain the country’s top source of electricity, accounting for 43.8% and a total installed capacity of 12,406 MW, according to data from the Department of Energy.