By Joseph Somsel
The Philippines is a tropical country of 113 million people, with beautiful beaches, dense rainforest, 11,000 islands and a smiling, hardworking, educated population. English is the official language, unifying a multitude of native languages and dialects, allowing “foreign workers abroad” to return billions of remittances and annual savings to the land economy. country. What it doesn’t have is an abundance of native energy; High electricity prices have hurt its competitiveness relative to its Southeast Asian neighbors.
What they also have is a flourishing democracy – Filipinos put “party” back into “political party”. With the election coming up on May 9order, high electricity prices and unreliable service have become an issue of the campaign. The outgoing Dutarte administration has been criticized by major presidential candidates for not doing enough with these high prices (presidents serve but only serve six-year terms). While President Dutarte is internationally known for his “extrajudicial treatment” of shabu Trafficking (methamphetamine) to restore civil order and for the delicate geopolitical balancing act between China and the US, his administration has been actively behind the scenes preparing for the final adaptation. end of nuclear energy into the power generation mix. This has included a detailed study of the Korean costs of rehabilitating and bringing into service the Bataan Nuclear Power Plant (BNPP), which was placed in caretaker mode in 1986, never before. become serious. The International Atomic Energy Agency (IAEA) was also invited to present a partially issued government action plan. The government has scheduled to identify 10 more sites for the new reactors. The main basis was when Dutarte officially issued Decree No. 164 at the end of February, which bluntly stated “The National Government is committed to the inclusion of nuclear power technology in the State’s energy mix for electricity production”.
There are two main reasons why electricity prices rise in the long run. One is the rapid depletion of the country’s large offshore natural gas field, which currently provides 20% of electricity production. Further investment in expanding exploration and development in the South China Sea is hampered by Communist Chinese aggressive attitudes towards resource ownership in the area, be it fisheries, coral reefs or oil/gas. The second is the signing by the previous administration of Benigno “Noynoy” Acquino of the Paris Agreement in April 2016. He pledged that the Philippines would give up allowing new coal plants not yet in the regulated pipeline. . In return, the Philippines was promised to provide development finance for the alternatives; the money has not come so far. Coal currently provides nearly 60% of kWh sold and is mainly fueled by Indonesia’s bitumen at a fuel cost of around $3/million BTU.
The Dutarte Department of Energy’s future energy plan, published in January 2022, envisages that the way forward (nuclear sans) will be a major shift to imported liquefied natural gas. exports (LNG) and a large expansion in photovoltaics (PV). LNG deliveries on the Tokyo Bay spot market were running at $8 a million BTU (long-term contracts can be slightly lower) before the Ukraine War caused major disruptions in demand and prices. Some forecast hydropower expansion, but recent calls for additional projects have failed to attract bidders as expected even at attractive “import prices”.
How candidates looking to succeed Dutarte will hope to lower electricity prices as current options under the Paris Agreement are replacing $3 coal and $2 natural gas with $8 + LNG and Chinese-made PV manufacturing? An active nuclear power program may not immediately reduce current bills but will at least provide some stability in prices and supply while reducing CO2 emissions. Germans and Filipinos today probably have the same regrets about their earlier decisions about nuclear shutdown.
Joseph Somsel is a nuclear engineer (with an MBA) and longtime public analyst on energy policy. More detailed information on the Philippines’ energy situation can be found in the April 2022 issue of International Journal of Nuclear Engineering.
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