Erring Gencos facing probe for collusion raps amid continuing brownouts

Published June 10, 2021, 2:54 PM

by Myrna M. Velasco

The Department of Energy (DOE) said erring power generation companies (GenCos) are being investigated for possible collusion that resulted in brownouts this year even as it raised alarm of high probabilities of power outages until July this year.

“We are already investigating these power plants and asked the assistance of the Department of Justice, the Philippine Competition Commission and the Energy Regulatory Commission to determine if there was a collusion,” Energy Secretary Alfonso G. Cusi told a Senate Committee on Energy hearing on Thursday (June 10).

The energy chief added that if the market-gaming culpabilities of the GenCos will be established, and “proper charges shall be filed against those who are responsible.”

He specified that the May 31 and June 1 rotational brownouts that happened had been mainly trigged by the simultaneous forced outages of four power plants that subsequently led to capacity loss of more than 2,000 megawatts in the system.

The power generating facilities that suffered unplanned outages on those days include the: unit 2 of Sual coal-fired power plant; unit 2 of the Calaca coal-fired plant; unit 2 of the GNPower Mariveles coal plant; and unit 2 of the Pagbilao coal-fired power facility.

Aside from forced outages of electric generating units, Cusi similarly tossed blamed on the de-rating of some power facilities, which he claimed had aggravated power supply deficiency in the grid.

For that reason, the DOE secretary emphasized that plants with de-rated capacities are also under probe and could face charges, especially if determined that they resorted to capacity withholding.

“There are other contributory causes, not just the big power plants on outage, but also the volume of de-rated capacity, which includes coal, hydropower and wind farms, among others that reached more than 4,200MW,” Cusi stressed.

The energy chief emphasized “these de-rated power plants further dwindled the available supply in Luzon from a registered capacity of 17,266MW; then less the de-rating and outages, the net available energy supply in Luzon for May 31 and June 1 went down to around 10,600 megawatts only – that’s including the reserves already.”

Cusi further noted that based on their analysis, “we saw some abnormalities and so we issued corresponding letters demanding explanations from these power generation companies – those with de-rated capacity.”

The DOE chief argued that “under the must-offer rule, all power generation companies are mandated to make available their maximum generating capacity to prevent capacity withholding by the power plants.”

As to outlook on power supply, DOE Director Mario C. Marasigan concurred to projections of the system operator that there would still be high probability of brownouts between June 11 to end of July, with projections that ‘red alert’ will linger in the coming weeks.

The saving grace that the energy department has been leaning on will be the supply addition that will be coming from unit 1 of the GNPower Dinginin power facility with 668MW capacity.

ERC Chairperson Agnes T. Devanadera, nevertheless, qualified that the committed commercial operation date (COD) of the Dinginin plant based on its application for certificate of compliance (COC) will be by August this year yet.

Senate Committee on Energy Chairman Sherwin T. Gatchalian thus quizzed the DOE, that if the Dinginin plant is still at its testing and commissioning phase, then its capacity contribution to the grid may still be on unstable basis.

The DOE, in turn, has acknowledged that such may still be the case, hence, it is conceding to expectations of high probabilities of brownouts until the last week of July.