Mindanao will be seeing a different outlook by the end of this year until early 2017 in terms of power and energy as the island-region’s energy mix is already in excess of about 700 to 1,000megawatts (MW), a senior official of the Mindanao Development Authority (MinDA) said.
MinDA deputy executive director Romeo Montenegro said the Department of Energy is currently rolling out the introduction of a wholesale electricity market in Mindanao considering the changes it is currently experiencing in its energy landscape.
“More than three years ago we have been discussing on how to address the rotating brownouts in Mindanao … today the discussion is on how to devise a dispatch protocol to make sure that the current energy mix which is already in excess of about 700 megawatts to 1,000 will be well addressed by the industry players,” Montenegro said.
He is also seeing the establishment of wholesale electricity market by June next year.
“This is a happy problem,” Montenegro said, referring to the oversupply of energy that Mindanao is experiencing, as he compared the situation three years ago where Mindanao was struggling to have energy capacity to address rotating power outages.
He also described the current energy situation in Mindanao as a complete turnaround, saying “We now embrace an energy mix wherein there is 700MW going towards 1,000MW energy capacity excess by December and early next year.”
The coming on line of power plants that are nearing completion and up for commercial operations this year and early 2017 are among the factors that contributed to the huge energy excess in Mindanao.
Montenegro however emphasized that the energy capacity excess is also an issue that need to be addressed.
“Electricity that is not available is in itself already very expensive; electricity that is available but is not utilized is also equally expensive,” he pointed out.
Mindanao must manage well the supply and demand scenario and government must work with the private sector to proactively schedule investments on power generation.
Montenegro said the foreseen over-supply of energy in Mindanao will also not for long as demand, especially next year will also increase.
“These will be easily eaten up by the incoming demands for electricity that are surging in Mindanao,” he added.
Among the demands he noted are the mushrooming of malls, hotels, resorts, real estate projects and other industries in major cities and centers in the island-region.
“These are energy hungry industries that will make the demands increase next year,” he said.
The government is now looking up to immediately deploy and utilize the excess capacities in energy in Mindanao.
Power sales agreements are already waiting for approval by the Energy Regulatory Commission (ERC) to fully utilize the existing excess on energy.
There are a number of pending power supply agreements (PSAs) at the ERC, including those from electric cooperatives and private suppliers of energy, Montenegro noted.
There are 33 electric cooperatives and four private energy suppliers currently operating in Mindanao.
He said electric cooperatives and private suppliers will be engaged in series of sessions next year to educate them on the operations of the wholesale electricity market.
Montenegro added that the energy market scheme will pattern the scheme implemented by the defunct Interim Mindanao Electricity Market (IMEM).
“We will look at the IMEM rules and mechanisms but we will also introduce some modifications,” he said.
The government established IMEM in 2013 to fill the supply gaps in Mindanao where various energy players were allowed to sell their extra capacities to energy distribution utilities.
The market was suspended the following year due to unresolved operational and commercial issues and concerns.
