Grid interconnection to entice RE investments

The targeted grid interconnection between Mindanao and Visayas, which would enable the export of renewable energy (RE) capacity from Mindanao grid to the electricity consumers in Luzon and Visayas, could entice the southernmost power grid to ramp up investments in renewables.

Davao Investment Conference 2021

Eric T. Francia, president and CEO of AC Energy Corporation of the Ayala group, highlighted in a recent Davao Investment Conference, that “once you unlock that potential through the spot market, retail competition and open access, it will spur a lot of renewable opportunities.”

He emphasized that Mindanao grid can strategically position itself as a “net exporter’ of energy – chiefly those generated from renewables and that can be greatly underpinned by the Mindanao-Visayas Interconnection Project (MVIP) that is due for completion next year.

Francia explained that the Green Energy Option Program (GEOP) could extend judicious choice to consumers to patronize RE as their supply source; and in the process, that will reinforce RE investments in the country.

Rolando “Don” Paulino, president of the Philippine Energy Independence Council (PEIC), reminded though that comprehensive supply chain solution must be prudently considered when it comes to the targeted massive RE installations in the country.

“We need to transition in a more evolutionary way. If we really want to go for a renewable business in the future, we also need to be ready with power plants that can come in whenever these renewable sources are not available,” he stressed.

He qualified that battery energy storage systems (BESS) have been flourishing as the best technology complement to RE, but the transition phase also calls for other more flexible plant solutions that could match the on-and-off or intermittent electricity generation capabilities of RE – and in the view of many experts, these are the gas-fired power facilities.

Assistant Secretary Romeo Montenegro, who is also deputy executive director of the Mindanao Development Authority (MinDA), echoed Mindanao’s grid aspiration to transition into an energy mix with at least 50-percent scale of RE integration – and that shall be a shift from the colossal installations of fossil fuel capacities in the past to solve then a power crisis tormenting Mindanao grid.

The MinDA official conveyed that “transition to renewable energy is policy-driven,” and part of the entire picture that shall be seriously examined in the regulation and policy domains must be “understanding the challenges of looking at eventually transitioning Mindanao’s energy mix to renewable energy.”

According to Anton Perdices, chief operating officer of the Distribution Utilities Group of Aboitiz Power, Mindanao grid has vast resources of renewables that can be harnessed to boost grid supply and for the region to reinforce the country’s overall sustainability goals.

He indicated that “all the resources in the region combined together really does give the advantage to Mindanao, to be able to lead the forefront for investments; and the power will follow with that.”

Davao in particular, is considered a major economic growth corridor for Mindanao, given the influx of investments in the area in recent years – and that in turn contributed to the high demand for energy in the grid.

On the whole, Dean Antonio La Viña, energy collaboratory-director of the Manila Observatory, opined that the shift of the Philippines to renewable energy is a critical step on its quest for climate justice in line with the goals of the Paris agreement.

He stated that “the Philippines has voluntarily committed to a 75-percent reduction of greenhouse gas emissions by 2030, meaning, we can no longer increase emissions by 2030. We need to have a very fast transition.”