Coal-fired power plants stir debate in Palawan

A plan to set up two coal fired power plants to meet the growing demand for electricity on the main island of Palawan has stirred fresh debate among environmentalists and other sectors in the province.

When industrial giant DMCI Holdings, through its subsidiary DMCI Power Inc., won the bidding for a 15-year, 45-megawatt supply contract with the Palawan Electric Cooperative (Paleco) in July, local and international environmental groups immediately began mapping out campaign plans to block the project.

“Coal is the dirtiest fuel around. There is no place for it in Palawan,” the Environmental Legal Assistance Center (Elac) said in a formal opposition it filed against the project now in the preliminary stage of permitting.

Palawan is considered the country’s bastion for environmentalism. It is the only place in the country that has its own special law, the Strategic Environmental Plan (SEP) for Palawan Act, which was passed by Congress and designed to preserve its biological diversity and ecological uniqueness.

The plants’ proposed location—right across the protected area of Rasa Island in the town of Narra, 91 kilometers south of Puerto Princesa City—has alarmed environmentalists. Rasa has long been identified as one of the few remaining habitats of the endangered and endemic Palawan cockatoo, a bird species highly sought in the illegal pet trade.

In a larger context, environmental groups such as Greenpeace International are waging a battle against coal plants. The Philippines has around 10 such plants, mostly located in Mindanao, and Greenpeace has aimed its campaign at convincing the government to shut down all or most of the plants and replace them with facilities that tap renewable energy.

A rock, hard place

A fast rise in demand for electricity, triggered by a booming tourism trade, has pushed Paleco to set a one-year deadline to outsource around 25 MW of additional power, lest the province is plunged into a debilitating power crisis and reverse an unprecedented tourism-led growth.

The city government had already recognized that the situation was at hand. In July, it passed an ordinance placing the city in a state of power emergency and asking National Power Corp. to step in and provide a bridging power supply until a new provider was contracted and able to set up more generators.

In the first instance when Paleco announced an open bidding for a 15-year supply contract, at least 10 independent power producers expressed interest to bid. All but three ended up placing actual bids after most realized that the playing field was not conducive to competition as it allowed for coal-based technologies to compete with the more expensive bunker or diesel-based providers.

“There’s no way we can compete with coal, price-wise, so we decided not to bid,” said Lito Abrogar, president of Palawan Power Generators Inc., which supplies the base load for the mainland grid using bunker-fed generators.

DMCI won largely because it offered the lowest bid of P9.38 per kilowatt-hour against a ballpark P13/kWh submitted by diesel-based power providers.

The power supply agreement between Paleco and DMCI was signed on July 23. All that DMCI needed was to secure a special permit called the SEP clearance from the Palawan Council for Sustainable Development (PCSD), the environmental compliance certificate from the Department of Environment and Natural Resources, and endorsement from at least two local government units.

In the first public hearing conducted by the PCSD on Sept. 8, environmental groups led by the Katala Foundation (which undertakes conservation projects on Rasa), Elac and the Palawan NGO Network Inc. registered their formal opposition.

“It is not that we don’t want additional power. We recognize the need  for that. But we oppose the establishment of a coal plant,” lawyer Grizelda Mayo-Anda, Elac executive director, told the PCSD.

Even Gov. Abraham Kahlil Mitra indicated that he would not allow the coal plant project. “Palawan is known for environmental protection and coal plants would not fit into provincial development plans,” he said in a text message to the Inquirer.

DMCI has shrugged off the opposition, stating that it is merely exercising its contractual obligation to put up the plant as specified in its bid and approved by Paleco. “If we are not issued a permit, there are other options available,” said DMCI President Nestor Dadivas, without going into details.

The reality was that renewable energy alternatives, such as hydro or biomass power, did not present themselves as readily available during the bidding period.

Langogan Power Corp., the sole renewable energy company that had initially participated in the prebidding conference, backed out during the bidding, saying the terms of reference of the project discouraged them from participating.

Rohima Sara, general manager of Paleco, said Langogan Power could only provide 6 MW “and it’s not even reliable power because it relies on unpredictable run of river.”

“Renewables are possible under the timeline prescribed in the bid. Whether coal is dirty or not, your choice is clear—power or no power,” Dadivas said.

Alternatives

Sara pointed out that the cooperative was pushing for policies that would have renewable energy sources providing them the main source of electricity.

“We are awaiting the circular to be issued by the Department of Energy so that a renewable energy supplier will take over our existing power supply agreements,” she said.

She added that the cooperative would eventually accept tenders to supply most of northern Palawan, including the municipalities of Taytay, San Vicente and El Nido, which were not yet connected to the mainland electricity grid.

Environmental groups offered a “talking point” with DMCI—stick to diesel plants and forego its main plan to construct the coal facility in Narra, while helping them develop a renewable energy power facility.

The sticky point in the debate revolved around the planned coal plant’s carbon emission, this being the main source of greenhouse gases that impacts on climate change.

“Carbon dioxide is the one emission that you can control in a coal plant. And this is important because Palawan is the environmental center of the country,” Bart Duff of the Palawan Chamber of Commerce said.

Environmentalists also scored DMCI for failing to present during the public hearings actual estimates of environmental damage that the plant would cause, including the disposal of ash that would accumulate during the plant’s operation. The amount of ash was estimated by DMCI officials to run as high as 600 tons a month.

They said they would bury accumulated ash in “silos” even as the Katala Foundation complained that there was not even a concrete plan where the waste material would be disposed.

DMCI insisted, however, that the proposed plant, to be built applying the latest “circulating fluidized bed” technology, had complied with the emissions cap prescribed in the country’s Clean Air Act.