DOE eyes new policy to boost reserves

MANILA, Philippines — The Department on Energy is drafting a new circular to boost reserves in the power grid.

DOE Undersecretary Emmanuel Juaneza said the new policy requires the grid operator to procure power reserves from new ancillary service (AS) providers.

“We are currently reviewing and polishing the circular. We have given it to the legal service. After the legal service review, it will be subject to a public consultation. We’re  hopefully looking at May or June,” he said.

The said circular will complement the existing policy on securing AS, said DOE-Electric Power Industry Management Bureau (EPIMB) director Mario Marasigan.

“What we’re issuing is not a new policy, but how the National Grid Corp. of the Philippines (NGCP) should do in procuring AS requirements.  We will detail how they should conduct bidding because these are pertaining to new AS providers,” Marasigan said.

Last year, the DOE issued a policy that will put more certainty on securing power reserves to avoid power shortage during tight supply. Under the policy, the DOE will set contracting caps for the reserves.

The new  policy aims to address the issue that some of these reserves are also sourced from the same generating capacities supplying to the power grid.

Contracted by the NGCP, AS is necessary to support the transmission of capacity and energy from resources to loads while maintaining reliable operation of the transmission system in accordance with good utility practice and the grid code.

The NGCP maintains the regulating reserve, which is the capacity allocated to cover inter and intra-hour variations in demand, equivalent to four percent of the demand in a specific hour.

It also maintains contingency reserve, which refers to the capacity allocated to cover the loss or failure of a generating unit or a transmission line in order to maintain balance between generation and load.

The NGCP secures dispatchable reserve, which refers to the generating capacity that is readily available for dispatch in order to replenish the contingency reserve service whenever a generating unit trips or a loss of a single transmission interconnection occurs.

Data provided by the DOE showed NGCP’s firm AS capacities cover only 48.3 percent of the regulating reserve, 27.8 percent of the contingency reserve and 22.4 percent of the dispatchable reserve for the Luzon grid as of end-2020.

For Visayas, the firm AS capacities cover 42.77 percent of the contingency reserve and 56.63 percent of the dispatchable reserve while all AS capacities for the regulating reserve are all under non-firm contracts.

Meanwhile, power reserves for Mindanao are all under non-firm contracts.

Last week, the NGCP warned of tight supply conditions in the Luzon grid, which is seen to last until August as power plant operators face technical limitations due to the COVID-19 pandemic.

NGCP said there are multiple power plants on extended outage due to technical limitations brought about by the pandemic such as delay in delivery of materials or spare parts, temporary work stoppage, and travel restrictions were stated as some of the reasons for the plants’ extended outages.

As the grid operator, NGCP maintains an annual GOMP which schedules the preventive maintenance of power plants, taking into consideration the needed supply vis-a-vis projected demand.