My New Year Wishes

This holiday is the time to reflect on the past year as well hope and pray for a better one. So, while wearing my renewable energy developer hat, let me share my new year wish list.

Top on my agenda for 2018 is the resolution of the ERC issue. Just last month four commissioners were suspended, which left the energy sector in limbo. This means that the sector is left paralyzed and this does not augur well for the New Year. 

Legal experts tell me that the basis for their suspension is skating on a very thin ice. And many are concluding that the move reeks of political vendetta. If these are true, then it is a development that does not bode well for our country. This undermines the very integrity of the regulatory framework and will bring about uncertainties on the security of investments in the sector. And this, obviously, will spell disaster for the entire economy. 

Equally important is for the players in the sector to realize important role of renewable energy (RE) on the economy. Yes, environmental sustainability is a crucial aspect, but using RE has a more significant benefit for households and businesses: the minimization of risk and lowering of power cost. This approach goes beyond the “least-cost” traditional view of energy planning. With the state of geopolitics, energy security and lowering of prices should be on the top agenda of the regulators today. Renewable energy has to be a priority. 

Related to risk minimization is the diversification of energy supply. Coal cannot and should not be relied upon solely for our energy needs. Natural gas has an important role to play in the country. Today, we source over 2,500 MW of our power needs from natural gas.  We cannot expect coal to replace that capacity when Malampaya runs out in seven years; Coal just does not have the physical characteristics intrinsic to natural gas. It is time to seriously consider how to develop Liquefied Natural Gas (LNG). Unfortunately, a monopsony like MERALCO is not easily swayed to buy such a massive capacity of LNG. It is imperative for our government to be more creative in finding ways to introduce LNG into the country.

The proposal to have an Independent Market Operator (IMO) is long overdue. However, aside from the IMO, we should also have an Independent System Operator (ISO) to ensure complete independence in the dispatch and operations of the power network.

 Finally, the world will be going towards a phase of distributed generation and smart grids. The government must prepare for this by providing robust telecommunication and internet infrastructure since the current internet speed in the country is just unacceptable. Our telecom and internet should be vastly improved.

 Happy New Year, everyone!

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