NAGKAISA! Laban sa EPIRA

Wilson M. FortalezaTraining/WorkshopSeptember 24, 2012

ALU Mariners’ Court, Cebu City

IMAGINE LIFE

WITHOUT LIGHT & power

Walang

Kabuhay - buhay

Ang kuryente ay nagpapagaan ng buhay

Pabigat sa industriya

(26% cost of production)

Pabigat sa bulsa ng manggagawa

(10% - 20% of income)

Pero Sa pilipinas Ito ay pampabigat

Epira Ang problema!

Maliwanag na paliwanag

RA 9136

Ilang konsepto

• Power is a unique product. It cannot be stored It must be consumed as it is being produced Therefore the whole system must be efficient.

• Public utility Regulation• Natural monopoly Captive market• Economy of scale Small system

The power industry/system

GENERATION

TRANSMISSION

DISTRIBUTION

ELECTRIC POWERPLANTS GENERATEELECTRICITY

ELECTRICITY IS THENCARRIED OVER LONGDISTANCES BYTRANSMISSION CABLESTHAT IS TAPPED INTOBY LOCAL DISTRIBUTIONCOMPANIES

YOUR LOCAL DISTRI-BUTION UTILITY SETS UPTHE POWER LINES INYOUR COMMUNITY ANDSERVICES YOUR NEEDSFOR ELECTRICITY

GenerationCharge

TransmissionCharge

DistributionCharge

MeteringChargeSupplyCharge

PASS-THROUGH GENERATION CHARGES

(60 - 70%)

PBR(Transmission & Distribution)

(30 – 40 %)

From ERC presentation on Transco PBR

Walang libreng kuryente, Wala ring gustong manlibre

Government Taxes

System loss

Franchise tax

VAT

Environmentalcharge

Power industry noon at ngayon

Source: Department of Energy

Unbundling of rates

Separation of Generation from Transmission

Privatization of NPC

Establishment of Wholesale Electricity Spot Market (WESM)

Retail Competition and Open Access

EPIRA regime

EPIRA’s main objectives

Create competition in the industry Ensure efficiency, reliability and security of electricity supply Bring down rates

The industry10 YEARS under EPIRA

“Escalating rates, diminishing supply.”

FDC Power 101 based on presentations made by Prof. Wally Del Mundo of UP National Engineering CenterFDC First National Electricity Consumers Conference, January 2011

PHILIPPINE POWER RATES: ASIA’S HIGHEST

PHILIPPINES -------US$0.2460/kWh

Japan---------------US$0.243/kWh

Singapore---------US$0.22/kWh

Indonesia----------US$.092/kWh

Thailand------------US$.086/kWh

14

From Louie presentation

International Energy Agency (Q1 2011)

RESIDENTIAL (/kWh)Denmark ---US$0.3563Germany --- US$0.3248Italy --- US$0.2632Austria --- US$0.2576PHILIPPINES-

US$0.2460Ireland --- US$0.2326Japan --- US$0.2322Belgium --- US$0.2317Netherlands ---

US$0.2212Sweden --- US$0.2180

WORLD’S HIGHEST POWER RATES

15From Louie presentation

Escalating rates

Escalating rates

ESCALATING RATES

0

2

4

6

8

10

12

14

2001 2012

Price/kWh

PRE-EPIRA AUGUST 2012 *

P5.

00/k

Wh

P12

.68/

kWh

* Meralco effective rate (residential)

19

Philippine Power Development Plan (PDP) target 2013 -2030:

14,400 MW

To be commissioned capacity 2013-15:

650 MW

Committed capacity

1,172 MW

On security of supply

19th EPIRA Implementation Status ReportApril 2011 - October 2011, DoE

20

“While the government is receiving expressions of interest to expand existing plant or put up new plants with a total capacity of 5,023 MW, these are still at the different stage of development. Thus, there is still a possibility that these could not proceed to development status. With these, the government may need to involve itself once again into power generation to avoid power shortages in the future and keep hold of the current momentum being enjoyed as an investment attractive economy.”

On security of supply

19th EPIRA Implementation Status ReportApril 2011 - October 2011, DoE

The shift to private power

v

v

v

v

v

v

v

ENERGY SECRETARY Jose Rene Almendras (center) holds hands with Erramon Aboitiz (right), president of RP Energy, and Oscar Reyes (left), Meralco president and CEO, at the signing of a deal that transferred controlling stake in RP Energy to Meralco in July 2011. RP Energy is building a 600-megawatt coal-fired power plant in Subic Bay Freeport, which faces strong opposition. ROBERT GONZAGA/INQUIRER CENTRAL LUZON

PRIVATE power Luzon

Source: Philippine Electric Power Industry Market and Policy Assessment and Analysis of International Markets , UP Engineering Center, May 2011

The market is highly concentrated as these three groups control more than 70% of the generating capacity in Luzon. The share of others including AES, DMCI and Quezon Power Phils. are less than 7% each.

The total energy sales and consumption (including own use and system loss) in Luzon account for 74% of the total Philippines. Visayas and Mindanao has each 13% of the total energy consumption.

MARKET CONCENTRATION

PRIVATE POWER visayas

Source: Philippine Electric Power Industry Market and Policy Assessment and Analysis of International Markets , UP Engineering Center, May 2011

PRIVATE POWER mindanao

PRIVATE POWER (Distribution)

0

5,000

10,000

15,000

20,000

25,000

30,000

gWh Sales (2007)

Lopez DUs (Meralco)

Aboitiz (7 DUs)

119 Electric Cooperatives &1 LGU-owned

THE SUPPLY SECTOR RETAIL ELECTRICITY SUPPLIERSAboitiz Energy Solutions, Inc.Trans-Asia Oil and Energy Development Corp.GNPower Mariveles Coal Plant Ltd. Co.First Gen. Energy Solutions, Inc.Cabanatuan Electric Corporation.Masinloc Power Partners Co. Ltd.Premier Energy Resources Corp.Team Philippines Energy Corp.SEM-Calaca RES Corp.SN Aboitiz Power RESSan Miguel Electric CorporationGlobal Energy Supply CorporationFerro Energy, Inc.Kratos RES, Inc.Ecozone Power Management, Inc.GNPower Ltd. Co.AdventEnergy Inc. PRISM Energy, Inc.