With outages, Mindanao braces for P2.3B in productivity losses

Productivity losses from the current five-hour rotational brownouts may surpass the P2.3 billion suffered in 2014 by Cagayan de Oro, one of Mindanao’s progressive cities, when outages occurred three hours daily.

Tourism is among the sectors expected to post major losses, according to Romeo Montenegro, director for investment promotions and public affairs of the  Malacañang-attached Mindanao Development Authority (Minda).

“The huge impact is on tourism because it is summertime so there is a huge foregone revenue,” Montenegro said on Wednesday.

Business leader Joji Ilagan-Bian earlier estimated that the rotating brownouts resulted in P408-million daily economic losses. She based her projection on the 2014 report of the National Economic and Development Authority on Davao region’s economic output of P281.5 billion.

“Since Davao City’s service sector accounts for over 50 percent of this, you can imagine the extent… . That’s roughly P12.25 billion a month, or about P408 million a day,” Bian said.

Problematic power plants

Montenegro agreed that the losses would be enormous, but he said the amount would be determined when Minda came up with an assessment—in consultation with the business sector.

He said he hoped that problematic power plants could recover or be repaired as soon as possible to ease the situation.

Mariano Alquiza, director of the Department of Public Works and Highways in Southern Mindanao, said not only businesses but also government projects were suffering from the power outages. Groundwork in some projects had to be suspended because some electricity-dependent equipment could not be used, he said.

On Tuesday, Aboitiz-owned Davao Light and Power Co. (DLPC) announced that  it was implementing daily five-hour power interruptions because of the worsening power supply situation in Mindanao.

“Currently, based on the available power supply allocated to Davao Light by generating plants, the deficit has increased to an average of 100 megawatts. Hence, the duration has now increased from a maximum of two hours to a maximum of five hours,” DLPC said.

There would be a maximum of one-hour power interruption for every 20-MW deficit, it explained in an advisory.

Maximum duration of the rotating power outages will be divided into two schedules: four hours during the peak period (8 a.m. to 8 p.m.) and one hour during the off-peak period (7 a.m. to 8 a.m., and 8 p.m. to 12 a.m.).

El Niño phenomenon

“The reasons are still due to the worsening effect of the El Niño phenomenon on the major hydro power plants in Mindanao, the recent emergency outage of two Agus plants and the shutdown on April 6 of one of the units of Therma South Inc. (TSI) coal-fired power plant,” the power utility said.

TSI’s coal-fired plant in Barangay Binugao in Davao City’s Toril District, touted to be the answer to the city’s power problem, was commissioned only late last year. Since then, it has been shut down more than twice due to maintenance work “even if the plant was still new” and engineering problems.

Arturo Milan, DLPC president, said the shutdown decreased by half TSI’s supply to the utility from the previous 100 MW. DLPC and TSI are sister companies.

Another DLPC sister company, Hedcor in Davao del Sur province, was delivering only 22 MW instead of the contracted power supply of 49 MW, he said.

Milan said no reprieve could be expected from the Agus and Pulangi hydro sources as the drought drastically reduced their output to just 108 MW instead of the combined capacity of 982 MW.