Nuclear

Two weeks ago, several senators visited the Bataan Nuclear Power Plant (BNPP). They went there to assess the viability of finally activating this facility.

At least one senator, JV Ejercito, appears open to activating the plant. Ejercito noted: “We had our last payment for the BNPP in 2007. It is now owned by taxpayers, by all Filipinos. Why don’t we consider utilizing it?”

For over 30 years, this plant has been a monument to waste. Government paid $2 billion for what should have been the centerpiece of our strategic energy plan. Another $1 billion was since spent keeping this plant mothballed for over 30 years.

That is $3 billion down the drain without generating a single watt of electricity. This plant should go down to some record book of the greatest follies governments perpetrated on their people.

There are some who argue the BNPP can the used as is. All we have to do is buy some uranium rods and start up the mothballed plant. We will then have among the cheapest (and some say the cleanest) power source. I suppose the computations do not include the financing and mothballing costs that have accumulated over 3 decades of disuse.

Then there are those who say the plant is obsolete. They propose taking out the old nuclear facility and replacing it with a more modern generating unit. That will cut the waste only marginally.

Then there are those who propose retrofitting the plant, converting it to run on coal. Basically, they are saying we take out the reactor and install a coal burner. The cost for doing this will still be over $1 billion.

Many of those opposing nuclear power tell us to look at the Fukushima tragedy. But that is a false parallel. The Bataan plant is way above sea level and it is nearly impossible for a tsunami to come in from the compact South China Sea.

Nevertheless, use of nuclear power will definitely spark a polarizing public debate. It is that possibility that encouraged the politicians to allow the plant to sit idly for three decades.

Over the next 15 years, DOE Secretary Alfonso Cusi estimates the country will need at least 10,000 MW of new energy. The BNPP could immediately supply 620 MW if activated tomorrow. That will supply only part of our anticipated requirement. 

If we are to build a second nuclear plant, this will probably require a whole decade, including the period of intense debate preceding such a decision. There are well-entrenched groups with well-entrenched arguments against nuclear power. They are not likely to easily concede to the use of nuclear power, however desperate the power situation gets.

Among the entrenched groups averse to the use of nuclear power is the Catholic hierarchy. The resistance may not be based on proper science. It is orthodoxy with numerous adherents.

Coal

The price of technologies of alternative power generation may be decelerating, but the generation costs of renewable energy (RE) remains prohibitive. Besides, they are not reliable to supply the grid with base load power.

The only reason we have investments going into RE is because a tariff is imposed on all electricity consumers to subsidize alternative power generation. That tariff raises power costs for everyone. The more RE is utilized in the country’s energy mix, the longer we remain a country with the most expensive electricity.

From a strictly environmentalist standpoint, that might just be fine. But there are serious economic consequences to that. Expensive power makes industrialization less than viable. That spells lesser jobs created and more people poor.

 The intensely political resistance to nuclear power and the high costs of RE give us not option but to use coal. Forget about returning to diesel plants. They are expensive and dirty.

The Duterte administration appears reconciled to the idea that we will be using coal as our main energy source.

Last week, President Duterte took time to grace the inauguration of the FDC Misamis Power Corporation, now supplying 405 MW to the crucial but power-short Mindanao grid. Business in the Zamboaga peninsula, for instance, suffered greatly for years because of 12-hour rotating brownouts.

The President took the opportunity to take a swipe at “hypocrisy” of international institutions encouraging us to invest in expensive green energy.

With his characteristic pragmatism, Duterte declared: “if we want to industrialize our country, because we are left behind by so many generations, we have to keep up with developments. (The main option) right now is coal because it is cheap, it is available, although it may have impact on the planet.”

This seems to be the policy direction of the current administration. Duterte’s position on the energy mix has been consistent since the campaign period.  He even advocated rejecting the Paris Accord on reducing carbon emissions because it blocks the advance of the developing economies even if most of the pollution comes from the advanced industrial countries.

There will always be room for RE to grow. Increase on our power needs, especially if we shift to investment-led growth, will be immense.

But the growth of RE must not be based on market intervention that forces all consumers to cover the risk and ensure the profitability of investors in green energy through a cross-subsidy. The Feed-in Tariff (FIT) – especially if it is raised further – will only serve to abort our industrialization and penalize our manufacturers.

There is an ideal energy mix that will make everyone happy. Then there is the practicable energy mix that puts primacy on growing the economy and reducing poverty.