The projected shortage in 2012 can be addressed by building geothermal, hydro power, natural gas, wind, and solar power plants even without the operation of the nuclear plant in Bataan if only government builds the necessary indicative capacity additions and develop and upgrade exisiting power plants. We discuss the historical background of the power industry in the Philippines in relation to the Bataan Nuclear Power Plant and address the reasons raised by the proposed bill in Congress as to the need for building the Plant. We further point out the immediate impact of the proposed bill on electric power rates.

Power PlaysElectric Power and the Bataan Nuclear Power Plant

Power Shortage?

Quoting figures from the various updates of the Philippine Energy Plan from the DOE on their website, the projected shortage in 2012 can be addressed by building geothermal, hydro power, natural gas, wind, solar and coal plants even without the operation of the nuclear plant in Bataan if only government builds the necessary indicative capacity additions and develop and upgrade exisiting power plants.

Kayang sagutin ang “kakulangan” sa 2012 kahit wala ang BNPP kapag itinayo ang mga geothermal, hydro, natural gas, wind, solar at iba pang pagkukunan ng enerhiya

(combined data 2006 PEP Update+Supply Demand Profile, Napocor+simulation of half growth rates

)

2012 GAP (1495 mw)

(combined data 2006 PEP Update+Supply Demand Profile, Napocor+simulation of half growth rates

)

2012 GAP (1495 mw)

Gap of 1495 MW from required capacity and online dependable capacity.

(2006 PEP Update+Supply Demand Profile, Napocor)

Kabuuang maaring itayo: 2534-3400 MW(Total Indicative Capacity)

(2006 PEP Update+Supply Demand Profile, Napocor)

Kabuuang maaring itayo: 2534-3400 MW(Total Indicative Capacity)

Gas

Bio

Geothermal

Hydro

Hydro

Hydro

Geothermal

COAL

Hydro, etc

COAL

COAL

COAL

Geothermal

Gas

(2005 PEP Update, Napocor)

Levelized costs (P/kWh)

www.repp.orghttp://www.world-nuclear.org/info/inf02.htm

low high

Hydropower 0.24 1.13

Geothermal 0.71 3.3

Nuclear 0.71 3.77

Coal 0.94 2.36

wind 1.13 1.82

Gas 1.34 1.51

wind 1.37 2.06

cheaper

Where are the plants?

Government has pursued a policy of privatization

Has sold or in the process of selling our generation plants

Electric Power Industry Reform Act (EPIRA)

Direct cost to people: nuclear tax

The proposed bill would pass on the cost of the BNPP to ordinary consumers as a nuclear tax of P 0.10 per kilowatt hour for the total electric power generated in the country.

According to Section 22 of the Bill− “SEC. 22. Alternative Sources of Funding. – The State may raise equity through a

surcharge of PhP0.10/kWH of the total electric power generated in the country: Provided, That such collection of surcharge shall not exceed five (5) years from the date of its initial imposition. The funds collected shall be reimbursed to the electric consumers after such time that the BNPP shall commence commercial operations. The time frame for such reimbursement shall not exceed three (3) years. The State is also authorized to enter into international or domestic loan agreements to fund the implementation of this Act: Provided, That the total funds raised from the surcharge and the loan combined shall not exceed US$1 billion.”

De-facto nuclear tax of10 centavos per kWh

Direct cost to people: nuclear tax According to figures from the , the total electric power

sales in 2007 is 48,009 GigaWatt hours (1,000,000,000 or billion watt-hour) or 48,009 million kilowatt hours.

4 billion pesos per year or 100 M USD per year For five years, the total would be 20 billion pesos. For household of 300 kwh per month, you would

have to pay an additional of 30 pesos (no VAT yet) per month or a total of 1800 pesos for five years.

(DOE website)

PhP 20 B for five years = PhP 1800 per 300 kwh user

More loans and more costs The remaining 500 Million USD balance from

the projected one billion dollar cost is to be obtained by entering into international or domestic loan agreements.

Delays and interest repayments can drive this higher and become a new burden for the Filipino people.

Overnight capital cost (2008 $/kW) : 4038 USD 620 MW = 2.5 B USD (excluding interests)

Www.nei.orghttp://www.world-nuclear.org/info/inf02.htmA comparative study published in January 2008 for a Connecticut Integrated Resource Plan, USA,

Posibleng mas lalaki pa sa 500 M na paunang uutangin dahil sa interest at iba pang gastos

Decomissioning costs

• P 15.35 B for 30 years of operation set aside for decomissioning (0.002 USD/kWh) = 326 M USD

• Cleanup of Three Mile Island costs: TMI Dec 93 = 975 M USD

• Decommissioning costs in the US: $325 million per reactor all-up (1998 $), France 480 million euro (70MW), UK 32 MW power plant 117 M EUR, 100MW power plant, cost about 90 M

Kulang ang itinatabi para sa decomissioning

Waste disposal costs

• P 7.67 B for 30 years of operation set aside for decomissioning (0.001 USD/kWh) = 163 M USD

• These costs (decomissioning and waste disposal) shall be passed on to us by NAPOCOR or the concerned government agency

• Total addon cost: 0.003 USD = 0.1413 PHP

Kulang ang itinatabi para sa disposal

Total costs to be passed on to us? NPC either will absorb decomissioning costs or add it to

our generation rate For a 300 kWh household total for first 5 years

P 20B for five years = P 1800 pesos P 7.67 B for 30 years disposal cost (first 5 years) = P 847 P 15.35 B for 30 years decomissioning (first 5 years) = P 1696

First five years = Additional of 4343 pesos Or equivalent to additional 72 pesos per month!

Remaining costs to be collected throughout the lifetime of the plant: 42 pesos per month

Dagdag na singil ng 72 pesos kada buwan

Global Financial Crisis The projected peak demand for 2012 should be

recomputed to include the effects of the global economic crisis and recession.

There should be a second look at the growth projections used in the simulation for the 2012 targets due to the global economic crisis that is expected to foster GDP growth in 2009 to be only half or even less than in 2007 which would be the slowest since at least 2001. We need not rush and nor make “IMMEDIATE” the reopening the nuclear plant.

Bagong targets dahil sa krisis: mabagal ang ekonomiya

(combined data 2006 PEP Update+Supply Demand Profile, Napocor+simulation of half growth rates

)

Adjusted2012 GAP (165 mw)

Adapted from Fernando Y. Roxas, Why is Napocor Losing So Much Moneyin The IPP Experience in the Philippines Erik J. Woodhouse , Program on Energy and Sustainable Development Center for Environmental Science and Policy , Stanford University http://pesd.stanford.edu

Stable supply = lower rates?

Having a stable or even a surplus of electricity capacity does not necessarily translate to lower energy costs. In recent years when we had an energy oversupply, power rates have still gone up due to one-sided contracts and the pass-on provisions of EPIRA.

(combined data 2006 PEP Update+Supply Demand Profile, Napocor+simulation of half growth rates)

Surplus and yet electricity prices is around 8.75 pesos per kWh!! (included are VAT, IPP contract costs, systems losses, etc; to be included NPC stranded debts, etc)

Other sources can also provide baseload power.

Nuclear plants are said to be able to supply baseload power as opposed to renewable energy, which can supply only a fraction of the energy demand. We need to develop and expand geothermal to supply baseload capacity in our energy mix as well as funding and developing energy-storage solutions that can compensate for the disadvantages of wind and solar power.

(2007 Power Statistics)

Indicative Geothermal Projects

PEP 2006-2014 www.napocor.gov.ph

Geothermal projects of baseload capacity could be online by 2014 totals 750 MW

Indicative Geothermal Projects

PEP 2006-2014 www.napocor.gov.ph

Geothermal projects of baseload capacity could be online by 2014 totals 750 MW

The Malampaya ProjectOctober 2001

Shell as operator (45%), Chevron (45%), PNOC (10%)

3.9 trillion cu. ft. (Tcf) of proven reserves

Estimated 30-40 million barrels of recoverable oil deposits (to be bidded out)

Other Alternative Energy Sources

Solar: tropical country

Wind: 7,400- 14,363 MW (DOST 70,000 MW) potential

Geothermal: 2nd in world: 1931 MW – 3131 MW (estimated)

Tidal Power, Wave Energy, Ocean Thermal Energy, Fuel Cells and Hydrogen Technologies

Government's grand mega-sale

Expected foreign investmentsExpected foreign investmentsP177 billion potential investment in the P177 billion potential investment in the renewable energy sector for 2004-2013 (60% renewable energy sector for 2004-2013 (60% of the P295 billion in investments)of the P295 billion in investments)

EPIRAEPIRAIPPsIPPsSPUGSPUG

SPEX in Malampaya SPEX in Malampaya 45 % Shell, 45 % ChevronTexaco45 % Shell, 45 % ChevronTexaco10% to be sold10% to be sold

Philippines rich in energy sources

Nationalization not privatizationEnsure people’s welfare

Strategic planning for sustained growth

People's control over energy resources

Build R&D capacity in energy technologies

Power PlaysElectric Power and the Bataan Nuclear Power Plant

www.no2bnpprevival.org