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Electricity/Power Grid

Cambodia’s PM Hun Sen Orders Critics’ Electricity Shut Off Amid Furor Over Power Shortages

31 March 2019

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Cambodia

Cambodia’s Prime Minister Hun Sen has told officials to cut off electricity to the homes of those who claim he orchestrated blackouts to drum up public support for a controversial hydropower dam, after the head of an environmental NGO suggested the government was responsible for power outages that have plagued the country this year.

Over the weekend, RFA’s Khmer Service reported that residents and activists in Koh Kong province believe the government has been restricting power flow to the region to justify building the Stung Cheay Areng hydropower dam, despite environmental concerns that shelved the project in 2015.

RFA quoted Alejandro Gonzalez-Davidson, founder of local environmental watchdog Mother Nature, as saying that officials should resign and apologize to the public for the cuts, which have lasted for several weeks and are expected to continue through May.

The government has attributed the shortages to high temperatures affecting the ability of dams to generate power and high levels of public consumption, and said the grid is around 400 megawatts short of what is needed to supply the country during the dry season.

On Tuesday, Hun Sen said that an electricity shortage “is not a reason to build a hydropower dam,” and called the claims that the government planned to go ahead with the Stung Cheay Areng project untrue.

“If we know which house [belongs to those accusing the government], please shut off the electricity supply—let them light torches,” the prime minister said, speaking at a ceremony to recognize the opening of a water system in Kampot province.

The Khmer Times quoted Kin Phea, director general of the Royal Academy of Cambodia’s International Relations Institute, as saying that critics “should consider the facts rather than be driven by political motivation,” and blamed the shortages on climate change.

In response to Hun Sen’s comments, Affiliated Network for Social Accountability (ANSA) executive director San Chey told RFA that the government should accept criticism and be willing to make changes if complaints are legitimate.

“The government can’t avoid criticism over the blackout,” he said, adding that officials should work to provide a solution to the problem instead.

Cambodia’s government has said it will lease a floating power station from Turkey to generate additional power for the country, and also recently announced plans to purchase electricity from its neighbors.

On Wednesday, government spokesman Phay Siphan announced in a Facebook post that the Council of Ministers will vote April 5 on whether to approve an 80-megawatt hydropower dam in Pursat province and another dam of 60-megawatt capacity in Kampong Chhnang province to lessen the impact of power shortages, but didn’t elaborate on details of the two proposed projects.

Mother Nature’s Gonzalez-Davidson told RFA he was unable to comment on whether the government should proceed with the two dams, as he lacks information about the projects, but suggested that the government would be better off investing in solar energy because the infrastructure takes less time to put in place and power production is far more sustainable.

“Solar energy is cheaper, doesn’t result in forced evictions, and has no impact on fish stocks,” he said.

Mekong development

The controversy over the shortages came as environmental NGO International Rivers released a factsheet on the impact of hydropower development based on the findings of a 2018 study conducted by the Mekong River Commission (MRC)—an intergovernmental organization that works directly with the governments of Cambodia, Laos, Thailand, and Vietnam to jointly manage shared water resources.

According to International Rivers, the study found that the plans for 11 large hydropower dams on the lower Mekong River mainstream and 120 tributary dams by 2040 “seriously threaten the region’s ecology and economy, as well as local people’s access to sufficient and nutritious food.”

But the group said that since the study’s release in February 2018, extensive dam construction on the lower Mekong mainstream and within the Mekong basin “has continued unabated.”

The study warns of impacts in current and proposed Mekong hydropower expansion due to losses to fisheries, sediment transport and other ecosystems services that International Rivers said would in turn heighten food insecurity and vulnerability of communities throughout the basin.

The study also recommended that member countries consider emerging energy technologies, such as solar and wind, as alternatives to hydropower.

“Assessing these alternatives, together with demand-side management and energy-efficiency measures, would provide major insights for managing water, energy, and food security more sustainably in the lower Mekong basin,” International Rivers said.

Cambodia’s Mines and Energy Ministry has said that Cambodia produced 2,650 megawatts of energy in 2018—50 percent of which came from hydroelectric dams.

Electricity/Power Grid

With streamlined projects, power rates can be cut by P0.35/kwh

30 March 2019

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Philippines

That has been the scale of savings crunched by Senate Committee on Energy Chairman Sherwin T. Gatchalian, the principal author of the newly signed Energy Virtual One-Stop Shop (EVOSS) Law, that will then serve as digitally-enabled platform of streamlining approval processes on energy projects.

Patently, the law that was signed by President Rodrigo Duterte last March 8, takes the form of an “online system that allows the coordinated submission and synchronous processing of all required data and information” and will be the single decision-making portal for actions on applications for permits of new power projects.

“With this law, red tape in the energy sector will soon become a thing of the past as it promotes faster, simplified permitting process that would allow foreign and domestic investors with the capacity to build cutting-edge power plants to enter the market and stimulate competition in the Philippine energy generation industry,” Gatchalian said.

In turn, the more intense competition that could be spurred by the smooth running processing of project approvals could help bring down electricity tariff for consumers.

“With EVOSS, we estimate that a decrease in generation costs could lead to reduction of consumer electricity prices by as much as P0.35 per kWh,” the lawmaker said.

He thus further illustrated that for a household with average consumption of 200 kilowatt hours (kWh) – the resulting yearly savings could hover at P840, which could be a fraction of family budgets better allocated to other prime commodities.

Under the EVOSS law, the Department of Energy (DOE) is directed to “operate and maintain an effective information technology infrastructure system,” that will then physically and methodically aid the government in processing power project applications for permits and certifications.

On an interim phase of two years, a steering committee chaired by the Office of the President and having the Energy Secretary as vice chairperson, shall initially administer the EVOSS permitting platform.

That particular body shall have memberships from other key agencies involved in approvals of power project applications and permitting – chiefly the secretaries of the Departments of Agriculture, Agrarian Reform, Environment and Natural Resources, Interior and Local Government, and Information and Communications Technology, the chairperson of the Energy Regulatory Commission, the chairperson of the National Commission on Indigenous Peoples; the executive director of the National Water Resources Board; the chairperson of the Independent Electricity Market Operator of the Philippines; and the head of system operator National Grid Corporation of the Philippines.

Following consultation with the steering committee, it was prescribed that the Energy Secretary shall initiate processes for its department to “invest in the necessary hardware and software to improve and update the operation and maintenance of the EVOSS – and that shall include a virtual storage public data center. (MMV)

Oil & Gas

PXP Energy, Dennison scrap liquefied natural gas deal

30 March 2019

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Philippines

MANILA, Philippines — Pangilinan-led PXP Energy Corp. and Dennison Holdings Corp. of Dennis Uy have mutually agreed to cancel their potential teamup in the country’s liquefied natural gas (LNG) sector.

The mutual termination of agreement, which took effect yesterday, comes two days before the March 31 deadline to settle the entire subscription price, PXP Energy disclosed to the Philippine Stock Exchange yesterday.

“On effective date, all rights of the strategic investor to subscribe to the aforesaid common shares of the company, and any obligation of the company to issue such shares to the strategic investor, are terminated without any residual rights of any kind remaining with the strategic investor,” PXP Energy said.

“Accordingly, all other rights of the company under the agreement are terminated, including the right to receive payment of the remaining balance of the subscription price,” it said.

At the same time, PXP Energy said it also relinquished any and all preferential rights granted under the agreement.

The deal, which was signed in October last year, covers the subscription of Dennison to its 340 million common shares at P11.85 apiece totaling P4.03 billion.

In exchange for the shares, PXP Energy or any of its affiliate companies would be given preferential rights to acquire up to 49 percent in Phoenix Petroleum Philippines Corp.’s share in its joint venture with China National Offshore Oil Corp. (CNOOC) for LNG development.

However, earlier this month, Phoenix Petroleum and CNOOC Gas and Power Group Co. Ltd. signed a memorandum of understanding (MOU) with state-run Philippine National Oil Co. (PNOC) to explore and discuss business opportunities and cooperation in relation to the equity investment in Tanglawan Philippine LNG Inc.

Last year, Tanglawan Philippine LNG was granted a notice to proceed (NTP) by the Department of Energy (DOE) to build the LNG hub project with a capacity of 2.2 metric tons per annum which is targeted to start commercial operations by 2023.

With the cancellation, the downpayment paid by Dennison has been forfeited in favor of PXP Energy.

So far, Dennison paid one percent of the total subscription price amounting to P40.29 million last January.

While proceeds were supposed to be used in partly funding exploration activities and other oil assets within the Philippines and in Peru, PXP Energy said its financing would l not be affected by the termination of the deal.

“The cancellation of the agreement does not affect the funding obligations of the company in respect of its various service contracts this year,” it said.

PXP is an upstream oil and gas company incorporated in the Philippines whose shares are listed on the Philippine Stock Exchange.

The company directly and indirectly owns oil and gas exploration and production assets located in the Philippines, and indirectly owns an exploration asset located in offshore Peru.

Coal

Interview: Indonesia firmer on coal domestic market obligation: ICMA

30 March 2019

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Indonesia

The Indonesian government is taking a firmer approach to control thermal coal production this year, to ensure the domestic market obligation, or DMO, requirement is met, Indonesian Coal Mining Association’s executive director Hendra Sinadia told S&P Global Platts.

“This is the first time the government wants to closely control the production output, they have the authority to do so under the mining law,” Sinadia said on the sidelines of an industry gathering in Singapore. “Previously, it did not work well, so this year the government wants to be stricter in doing so.”

Last year, Indonesia tightened the DMO to ensure that domestic needs are met after more coal cargoes were diverted to the seaborne market because of higher price realization.

Under the existing regulation, coal companies have to allocate at least 25% of their annual coal production for the domestic market.

Indonesia’s coal production in 2018 reached 528 million mt, which was an increase of 14.5% from 461 million mt in the previous year, the Ministry for Energy and Mineral Resources data showed.

The initial production target for 2018 was set at 485 million mt. This was revised upwards to 506.9 million mt in September the same year. The production target this year has been set lower at 480 million mt.

According to a November 2018 Wood Mackenzie report by Vicky Adijanto, Indonesia’s consumption of domestic coal for power generation is expected to almost double from 84 million mt in 2018 to 157 million mt by 2027.

“This increase in power generation’s share of domestic consumption from 18.5% to 33.6%, is likely to displace export tonnage,” the report said.

Sinadia noted the difficulty in implementing the policy effectively in the past due to lack of coordination between the local government, which issues the mining licenses, and the central government, which oversaw the production approval process.

“So it is hard for the central government to control how much each particular region is allowed to produce,” he said.

He added that the DMO requirement was 25% last year and the quota this year “will be higher than 2018,” without going into specifics.

“It is not easy for the central government, so this year it wants to be firmer and they are using last year’s actual DMO as the basis to set the quota for the respective regions.

“It is not a production cut from the government’s perspective, as they only want to apply the DMO policy. The reason why the quota is slashed for certain companies in those regencies is because they have only performed very minimum DMO,” he said.

In February this year, Indonesia’s Ministry for Energy and Mineral Resources said it is sanctioning miners who did not fulfill sufficient domestic sales in 2018, stoking fears of an imminent supply tightness in the near term.

“So that’s why you see the East Kalimantan producers getting more than 50% production cut, that’s because the actual DMO performed by the companies there are low. Other regencies like South Sumatra have better DMO supply that’s why they are not too much affected,” he said.
PRICE OUTLOOK

Sinadia expects Indonesian thermal coal prices to hold up amid the supply-demand balance this year.

“With the firmer DMO approach, there’ll be lesser supply this year, especially for the low grade. But it also depends on China. If we are using this assumption [of lesser supply], I think prices will be mostly stable or slightly better than Q4 last year, if demand is still there,” he added.

That said, there is still a possibility that government may review any proposal by miners for a revised production plan, particularly for the local regencies that have seen their output quota slashed significantly.

“Maybe there are some companies in those regencies that want to increase production in the middle of the year as they see a potential market. They can come to the government for a review, and the local government will coordinate with the central government on this,” he said.

In terms of demand, he expected the demand from China would not differ too much from last year.

“For the lower grade coal, I think from Indonesia’s perspective, there’s still demand from China for Indonesian coal,” he said.

“The key now is how the Indonesian government controls the supply. Every bit of increase of production from Indonesia might affect the market,” he noted.
USE OF NATIONAL VESSEL

The Indonesian government has announced in the Trade Ministry Regulation No. 82/2017 making it mandatory to use locally owned shipping vessels for the export of certain commodities including coal.

This regulation was first set to be implemented in May last year, but was postponed to May 2020 after resistance from the exporters.

Despite the additional time for preparation, Hendra noted the difficulties in implementing the policy by next year due to limited Indonesian shipping capacity, which contributed to less than 2% of the global vessel count.

“We’re proposing to the government that this policy be implemented in stages instead of enforcing it at one go next year,” he said.

“I suggested that we have a comprehensive roadmap and clear definition of national vessel, so that exporters can be better prepared,” he added.
DEMAND FROM SOUTHEAST ASIA

Hendra shared that the “future of Indonesian coal looks promising”, with demand from Southeast Asia coming up strongly and he sees good opportunity in the Southeast Asian market.

“Vietnam for instance, there’s one power plant that will start importing from Indonesia from 2021 and other huge coal-fired plants will also import. So starting next three years, Vietnam and also Malaysia will need more Indonesian coal,” he said.

Bioenergy

Construction of P2.5-billion waste-to-energy project in Davao to start in Q3

29 March 2019

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Philippines

DAVAO CITY (MindaNews / 29 March) – The national government will start the construction of the waste-to-energy (WTE) project worth P2.5 billion in a 10-hectare property acquired by the City Government of Davao in Biao Escuela, Tugbok District by the third quarter this year, Vice Mayor Bernard Al-ag said on Friday.

Speaking during the Mindanao Business Forum at the Seda Abreeza Hotel here, Al-ag said the WTE project, which will be implemented through a grant from the Japanese International Cooperation Agency (JICA), would be the city government’s “long-term solution” to address the solid waste problem.

He said the city government, the beneficiary of the WTE project of the national government, signed a memorandum of agreement with the Department of Finance last Tuesday for the funding of the project.

Al-ag added that the city government was veering away from the “landfill approach” in favor of the WTE technology to solve the solid waste problem in the city.

He said the nine-year-old seven-hectare sanitary landfill, located in New Carmen, Tugbok, has nearly reached its maximum capacity.

The local government had set aside P50 million to extend its lifespan to another five years, but it could not be usable beyond 2024, according to the vice mayor.

Asked about the concerns of the environmentalists on the possible health and environmental risks of the WTE project, Al-ag said that they would push through with the project for as long it does not violate the provisions of Republic Act 9003 or the Ecological Waste Management Act of 2000, and that they operate within the bounds of the RA 8749 or the Philippine Clean Air Act of 1999.

He said Davao’s sister city in Japan since 2018, Kitakyushu, would provide the technical support in the construction of the WTE, which will be completed in three to four years.

In a statement, No Burn Pilipinas, a coalition of environmental advocates in the Philippines, opposed the construction of the WTE project, claiming that there are “documented failures of WTE from economic and investment perspectives and these are mostly from advanced and rich countries such as UK, Germany, and Australia.”

The coalition said “emissions from incinerators contain heavy metals, dioxins and furans, which may be present in the waste gases, water or ash. Plastic and metals are the major source of the calorific value of the waste.”

“The combustion of plastics, like polyvinyl chloride (PVC), gives rise to these highly toxic pollutants,” it added.

It said WTE is the most expensive way to produce energy.

“It is 10 times costlier than coal fired power plants and 4 times the nuclear. The one being proposed in Quezon City is said to produce 1kW at P524 while solar energy can be harnessed for only P53 or even less. These are just some of the reasons why WTE incineration in other countries are being phased-out,” it added.

Mary Ann Fuertes, managing trustee of Interface Development Interventions, said the WTE project was worrisome, and called on the local government to hold massive consultations with the different stakeholders.

While it could not be denied that the city is confronted with woes on the solid waste management, Fuertes believed that a WTE project could only worsen the problem because people might think that it is “okay to produce waste” since the WTE needs garbage to generate energy.

“It runs counter to the values that we want to teach the people of Davao. We can endeavor to reduce our solid wastes by segregating properly our wastes, and as to the organic wastes, they can be brought to the composting site of every barangay. The problem now is that the city immediately resorts to technology to solve the problem,” she said. (Antonio L. Colina IV / MindaNews)

Coal

AC Energy’s Mindanao coal plant named project of national significance

29 March 2019

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Philippines

MANILA, Philippines — The Mindanao coal-fired power plant owned by AC Energy Inc. has been named as among the country’s energy projects of national significance (EPNS).

The Energy Investment Coordinating Council (EICC), led by the Department of Energy (DOE), has endorsed the 4×138-megawatt (MW) coal-fired power plant in Lanao del Norte in Mindanao owned by GN Power Kauswagan Ltd. Co. (GNPK).

GNPK is a limited partnership among AC Energy, the Philippine Investment Alliance for Infrastructure (PINAI) and Power Partners Ltd. Co.

Last March 13, the EICC issued certificates of energy project of national significance (CEPNS) for commerciality to GNPK’s power plant.

DOE Assistant Secretary Redentor Delola earlier said unit 1 of the GNPK coal plant (138 MW) would start providing capacity to the Mindanao grid in May and unit 2 (138 MW) in July.

Last month, the project of GNPK’s affiliate GNPower Dinginin Coal Plant Ltd. Co. had also been included in the EPNS list.

GNPower Dinginin, a limited partnership among AC Energy Inc., Aboitiz Power Corp. and Power Partners Ltd. Co., is set to complete the first unit of the 2×668-MW supercritical coal-fired power plant in Bataan within the year.

As one of the EPNS, the GNPK power plant will be entitled to all the rights and privileges under Executive Order (EO) 30.

The EPNS is intended to establish a simplified approval process and harmonize the relevant rules and regulations of all government agencies involved in the permitting process.

Signed by President Duterte in June 2017, EO 30 provides that government agencies concerned with energy projects should presume other agencies were able to act upon and issue their respective permits within a 30-day period.

If not acted upon five days after the lapse of 30 days, these projects are deemed approved.

So far, the EICC issued 75 CEPNS out of the 334 applications, while 52 filings were notified of non-compliance as to form and/or documentary requirements.

Read more at https://www.philstar.com/business/2019/03/29/1905355/ac-energys-mindanao-coal-plant-named-project-national-significance#JyWlZh9tObFeavh0.99

Renewables

Rural areas rely on renewable energy sources to gain electricity

29 March 2019

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Myanmar

Small scale hydropower plants, wind turbines and renewable energy sources are potential sources to supply electricity in rural areas, said Union Minister Thaung Tun for Investment and Foreign Economic Relations.

“The government is implementing to improve living standards for locals and infrastructure buildings in Chin State. In doing so, there will be many opportunities to make investment in renewable energy sector. The potential sources such as small scale hydropower plants and wind turbines are to supply electricity in rural areas where national grid is not accessible,” said the union minister.

People said Myanmar is the last market for Asia. Moreover we have to think of Chin State to be a good place to make investment. The state is located in western part of Myanmar and it is a link between China and India. Although it is a challenge as the state has mountains and incomplete infrastructure. They may be opportunities for investors, he added.

Investors are discussing with authorities to generate electricity from two large scale hydropower projects in Chin State, according to a report about challenges and opportunities for economic development for Chin State.

One project is located on Lay Myo River near Ko Phaeshay Village in Paletwa Township and the other project is located on Manipura River in Falam Township. Both can approximately generate 600 megawatts and 380 megawatts respectively, the report said.

Moreover the potential places, where small scale hydropower projects are likely to build, are Matupi, Mindat, Htantlan, Tiddim and Tonzan townships. A place in Tiddim Township can generate electricity from wind power, it said.

Oil & Gas

SPC opens first service station in Myanmar

29 March 2019

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Myanmar

YANGON: Singapore Petroleum Company (SPC) opened its first service station in Myanmar on Saturday (Mar 30).

The joint venture with Shwe Taung Group’s Shwe Taung Energy marks SPC’s first entry into the retail energy business in Myanmar. Shwe Taung Energy operates gasoline and diesel distribution centres across the country.

“Customers are promised an enhanced refuelling experience at SPC stations in Myanmar,” SPC said in a press release. “They will enjoy the same premium quality fuel developed by SPC, which is imported directly from its refinery in Singapore.”

SPC added that its stations are “designed with a strong focus on safety”, with features such as anti-static staff uniforms and designated walkways.

The joint venture plans to invest more into Myanmar’s retail energy sector, providing job creation opportunities in the country.

“We are seeing considerable growth opportunities in the oil and gas retail market in Myanmar. Consumers are become more discerning and sophisticated, and there is an increasing demand for higher quality products and services,” said SPC’s managing director Xia Hongwei.

“A recognised homegrown brand from Singapore, we are committed to developing the SPC brand in Myanmar. We promise to deliver the same added convenience and premium products and services to Myanmar,” Mr Xia added.

Shwe Taung Energy director U Win Htay said: “Combining SPC’s extensive retail experience in Singapore and Shwe Taung’s local knowledge, we are committed to fulfilling Myanmar consumers’ demand for energy in an environmentally and socially sustainable manner.”

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