ILIGAN CITY—The prospect of longer periods of darkness looms in Mindanao barely two months after

rotating brownouts first started mid-January, unless additional power generating capacities can be made
on-stream in its electricity grid within the soonest time possible.

On the morning of March 4, power generation deficiency reached a new high of 650 megawatts; peak
load demand was expected at 1,361 megawatts with only 711 megawatts available capacity. The
capacities of hydroelectric plants were very limited due to the alarming level of water in the reservoir.

Already, this situation is showing how the country’s Power Development Plan (PDP) has failed to
respond to the needs of Mindanao.

Apart from a radically lowered available capacity, rising demand is putting more pressure on Mindanao’s
existing power generation capability.

Based on data provided by the daily advisories of the National Grid Corporation of the Philippines
(NGCP), the problem of power generation deficiency began to reach crisis proportions on February 23.

Prior to this, brownouts lasted two to three hours. But by February 23, the outages last at least four hours.

A February 23 NGCP advisory mentioned that deficiency the previous day (February 22) stood at 183
MW. Hence, the radical rise in power generation deficiency in Mindanao started on that day, from 183
megawatts to 358 megawatts.

Earlier, on February 10, NGCP placed Mindanao under red alert status because its contingency reserve in
power generation was down to zero.

Beginning February 9, one 105-MW unit of the Mindanao Coal-Fired Plant was not running due to
planned outage. During this day also, the 90-MW diesel-fired plant of Western Mindanao Power
Corporation also reduced generation to 80 MW; and two 28-MW units of the National Power
Corporation’s (Napocor) Agus 5 and the 35-MW Iligan Diesel Power Plant (IDPP) were not available.

But by mid-February, these capacities—totaling some 206 megawatts--had returned to serviceability,

except the 35-megawatt IDPP.

It was the radical decline in hydro-power generation that plunged the island into more darkness on
February 23.

Between February 11 and February 23, available capacity plummeted 197 megawatts, from 1,039
megawatts to only 842 megawatts. During this same period, hydro-power generation went down by 183
megawatts, from 428 megawatts to only 245 megawatts.

Within a week of the crisis, there was a new twist in the power situation: a sharp rise in peak load
demand. Load curtailment, that is the reason for the outages, is called in during the peak load hours so
that available capacity is not strained.
Between March 1 and the morning of March 2, generation deficiency sharply rose 104 MW, from 390
MW to 494 MW because of a steep 106-megawatt increase in peak load demand. The deficiency climbed
further by 84 MW in the afternoon because of a rise in peak load demand by a similar magnitude.

From February 23 to March 1, peak load demand is only within the 1,200-MW to 1,220-MW range. The
steep rise in peak load demand on March 3 therefore set a new pattern. The NGCP has not responded to
queries about the reason for this rise in demand.

This is aggravated by the further lowering of hydro-power generation capacity which in turn dwarfed the
additional contribution of IDPP that was already running by March 2, producing at least 30 MW of
power.

Crisis numbers

The following figures show the anatomy of the current power crisis in Mindanao.

Table 1: Mindanao Power Generation Deficiency

Dates Available Peak load (in Generation Increase/ (Decrease) in

Capacity (in MW) Deficiency (in Deficiency (in MW)
MW) MW)

Feb11 1,039 1,195 -156

Feb23 842 1,200 -358 202

Feb24 863 1,220 -357 (1)

Feb25 876 1,210 -334 (23)

Feb26 900 1,210 -310 (24)

March 1 820 1,210 -390 80

March 2 AM 822 1,316 -494 104

March 2 PM 822 1,400 -578 *84 from March 2 AM

*188 from March 1

March 3 AM 808 1,318 -510 *(68) from March 2 PM

*16 from March 2 AM

March 3 PM 836 1,334 -498 *(12) from March 3 AM

*(80) from March 2 PM

 *4 from March 2 AM

March 4 AM 711 1,361 -650 *152 from March 3 PM

*140 from March 3 AM

Mindanao continues to be dependent on hydroelectric plants to generate its power needs. Although its
share in the power generation mix declined by more than 13 percent from 2002, hydro-power still
accounts a hefty 55.22 percent of the island’s power source in 2008, the Department of Energy’s 2008
Power Statistics showed.

Since commissioning in 2006, a coal-fed plant in Misamis Oriental has tripled its contribution but still
accounting for only almost a fifth of the 7.97 million MWh power generated in 2008.

From 14.3 percent in 2002, geothermal power has declined its share in the mix to only 9.96 percent in
2008.

In 2002 and 2003, the generation of oil-based power generating plants increased as hydro-power
decreased. Since 2006, at the time the coal-fired plant is already available, oil-based sources has gone
down, and it is now the coal-fired plant that responds to the rise and fall of hydro-power generation.

Table 2: Mindanao’s Power Generation Mix (in percentage), 2002-2008

Year Coal Oil-based Geothermal Hydro Solar

2002 - 17.00 14.30 68.70 -

2003 - 26.10 13.10 60.80 -

2004 - 27.03 12.84 60.13 -

2005 - 32.03 12.33 55.62 0.02

2006 6.42 22.55 11.41 59.60 0.02

2007 19.91 18.74 10.99 50.34 0.02

2008 18.80 16.00 9.96 55.22 0.02

The predominance of hydro-power generation in the electricity generation mix of Mindanao explains why
the island is continually vulnerable to a prolonged dry spell that lowers the water inflow that runs the
turbines of hydroelectric plants.
Table 3: Hydro-power generation

Dates Combined generation (in Increase/ (Decrease) in power generation (in MW)
MW)

Feb10 428

Feb23 245 (183)

Feb24 252 7

Feb25 265 13

Feb26 245 (20)

March 1 165 (80)

March 2 140 (25)

March 3 127 (13)

The February 10 figure for combined generation is a computation based on the NGCP advisory indicating
that the Pulangi plant had reduced its capability by 75 percent while the Agus complex was only running
at 50 percent capacity.

Table 4: Comparison between total generation deficiency and hydro-power generation,

Mindanao

Dates Available Capacity (in MW) Increase/ (Decrease) Increase / (Decrease)

from previous date (in in hydro-power
MW) generation (in MW)

Feb11 1,039 --

Feb23 842 (197) (183)

Feb24 863 11 7

Feb25 876 13 13

Feb26 900 24 (20)

March 1 820 (80) (80)

March 2 AM 822 2 (25)

March 2 PM 822 2 (25)

March 3 AM 808 (14) (13)

Table 4 shows that the drop in hydro-power generation accounts for a significant drop in total available
capacity. The February 26 situation is an exception.

The rise in capacity on March 2 is that although hydro-power generation dropped further, additional 35-
megawatt capacity was provided by IDPP.

Receding water

The NGCP generally points to the worsening decline in power generation capability of the hydroelectric
plants for the drop in available capacity to generate electricity for the Mindanao grid.

The hydro-electric power generating capacity, currently owned by the National Power Corporation
(Napocor) comprises six plants along the Agus River that snakes down from Lanao del Sur towards Iligan
City. This complex has a total capacity of 727 MW.

Another hydro-electric power generating facility is that in Maramag, Bukidnon which utilizes the waters
of Pulangi river, with a total capacity of 255 MW.

In all, the Agus and Pulangi plants have a combined 982 MW of hydro-electric power generating
capacity. But because of the dry spell, the receding level of water inflow has undermined its capacity to
produce electricity for the Mindanao grid.

The Agus plants are dependent on water inflow from Lake Lanao which in turn is fed by rivers emanating
from the Lanao del Sur and Bukidnon watersheds. The Pulangi River is fed by the watersheds of
Bukidnon and Agusan.

The water level in Lake Lanao, as monitored daily has already breached the critical point of 699.15
meters since last week.

According to Pedro Ambos of the Napocor’s Mindanao Generation division, some plant engineers are
already reporting the entry of some silt into the turbines.

When the water reaches the 698.15-meter level, Napocor will have to shut down the hydro-power plants
to prevent serious damage.

Data provided in the NGCP advisories showed that the lake water is receding at an average of one
centimeter a day since Sunday.

At this rate of decline in the water level, it will take three months before the condition for a forced
shutdown of the plants will occur. That would be towards June, traditionally the onset of the rainy season.

But within such period, the hydroelectric plants will only be running at less than 15 percent its capacity,
almost enough for the estimated 150-megawatt needs of the Zamboanga Peninsula.
Table 5: Water Level of Lake Lanao

Date Water level (meters) Decrease (in meters)

Feb28 699.08 --

March 1 699.07 .01

March 2 699.06 .01

Mindanao has 19 existing power plants with a total installed capacity of 1,953.9 megawatts. Of this, total
dependable capacity is at 1,672.1 megawatts comprising of diesel-fed, 493.4 MW; geothermal, 101.3
MW; hydro, 876.4 MW; solar, 1.0 MW; and coal thermal, 200 MW.

Eleven of these 19 plants are embedded generators for distribution utilities or large power users. The 11
plants have a combined rated capacity of 156.6 MW, or total dependable capacity of 122.4 MW. This
leaves eight plants providing for the entire Mindanao grid, at total dependable capacity of 1,549.7 MW.

An additional hydroelectric generating capacity of 26 MW is expected on April and another 16 MW on

May this year.

Failing Mindanao

The current power crisis is a reflection of the failure of the Department of Energy’s Power Development
Plan (PDP) to respond to Mindanao’s power needs.

A 2006 Update Supplement of the PDP showed that energy consumption was estimated to increase at an
annual average of 6.7 percent in Mindanao. Expected peak demand was determined along this projection.

Table 6: Projected Peak Demand

Year Peak Demand (in MW)

2006 1,293

2007 1,363

2008 1,440

2009 1,525

2010 1,620
But actual power demand was a bit lower. The DOE’s 2008 Power Statistics said this could be a result of
the downtrend in production activities between 2007 and 2008 because of the global recession.

Table 7: Actual Peak Demand

Year Peak Demand (in MW)

2006 1,228

2007 1,241

2008 1,204

2009 -

2010 -

The PDP noted that by end 2006, “the aggregate dependable capacity, including the embedded generating
units of private distribution utilities is estimated at 1,492 MW.”

With current dependable capacity of 1,672.1 megawatts, this means that 180.1 megawatts dependable
generating capacity was added in Mindanao in the last three years.

The PDP projected that in the next 10 years from end of 2006, the required capacity will increase to 2,556
MW. With the 210-MW Mindanao Coal-fired Power Plant on-stream by the end of 2006, the PDP
outlined some 850 MW indicative power projects to prepare for the expected rise in power demand.

These consist of at least 100-MW plants to be available yearly from 2009 to 2014. These capacity
additions were estimated in 2006 to require some P 99.5 billion.

Despite setbacks in the timing of these projects, the PDP’s 2006 Update still expected the 210-megawatt
coal-fired plant to contribute largely to “stabilize the power supply in Mindanao for the next two years,”
meaning for 2007 through 2008. This is why no capacity additions were recommended within these
periods.

It is quite notable that the peak load demand in the afternoon of March 2 of 1,400 megawatts is already
within range of the PDP’s peak demand projection for 2008, that is, 1,440 megawatts.
This means that Mindanao’s current power demand situation is comfortably within the planned level of
generation capacities.

What the PDP seems to have missed is factoring in various scenarios of a long dry spell’s impact on
hydroelectric power generation.

REPORT BY RYAN ROSAURO