WWF Power Switch Scenario Philippines

POWER SWITCH!
Sc e n ar io s an d Stra teg ie s for Clean Powe r Deve lo pmen t in th e

Ph ilipp in es
University of the Philippines Solar Laboratory

Kabang Kalikasan ng Pilipinas (WWF Philippines)
U.P. Electrical and Electronics Engineering Foundation
Prepared by: With inputs from:

Prof. Rowaldo R. del Mundo Rafael Señga
Charito M. Isidro Ina Pozon
Remife L.Villarino-de Guzman Liam Salter
Fidelpio V. Ferraris
2003, Kabang Kalikasan ng Pilipinas (WWF Philippines) / University of the
Philippines Solar Laboratory
This report was produced by the University of the Philippines Solar

Laboratory for the Kabang Kalikasan ng Pilipinas.
No part of this publication may be reproduced in any form or means

without the prior written permission of the Kabang Kalikasan ng
Pilipinas and the University of the Philippines Solar Laboratory.
Kabang Kalikasan ng Pilipinas

WWF Philippines
LBI Building
# 57 Kalayaan Avenue, Quezon City
Tel. No. (632) 433-3220 to 22
University of the Philippines Solar Laboratory (UPSL)

German Yia Hall, University of the Philippines
Diliman, Quezon City
Tel. No. (632) 924-4150
Fax No. (632) 434-3660
Email: solar@eee.upd.edu.ph
Web: http://www.upd.edu.ph/~solar
POWER SWITCH:
Scenarios and Strategies for Clean Power Development in the Philippines
TABLE OF CONTENTS
LIST OF FIGURES...........................................................................................................iii
LIST OF TABLES.............................................................................................................vi
LIST OF APPENDICES.................................................................................................viii
LIST OF ABBREVIATIONS ............................................................................................ix
EXECUTIVE SUMMARY .................................................................................................x
1 EXECUTIVE SUMMARY .................................................................................... 1

1.1 Introduction................................................................................................ 1
1.2 Technology and Resource Assessment
for Clean Power Development ............................................................... 1
1.3 Historical Performance of the Philippine Power Sector ..................... 4
1.4 Scenarios under the Philippine Energy Plan 2003-2012 ................... 7
1.5 Clean Power Development for the Philippines .................................... 8
1.6 Conclusions and Recommendations ...................................................10
2 ENERGY TECHNOLOGIES AND RESOURCES FOR

CLEAN POWER.................................................................................................13
2.1 Clean Energy Technologies .................................................................14
2.2 Resource Assessment...........................................................................20
2.3 Cost Comparison of Power Generation Technologies .....................32
2.4 Environmental Externalities ..................................................................35
2.5 Mitigation Options ...................................................................................37
3 HISTORICAL PERFORMANCE OF THE

PHILIPPINE POWER SECTOR ......................................................................38
3.1 Historical Energy Demand and
Installed Generating Capacity ..............................................................38
3.2 Historical Reliability Performance ........................................................41
3.3 Historical Environmental Performance ...............................................42
3.4 Cost of Electricity....................................................................................46
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4 SCENARIOS UNDER THE PHILIPPINE ENERGY PLAN

FOR 2003-2012.................................................................................................3.1
4.1 National Energy Planning Process ......................................................48
4.2 Gross Domestic Product Projections ..................................................49
4.3 DOE Plan for the Low Economic Growth Scenario ..........................50
4.4 DOE Plan for the High Economic Growth Scenario .........................57
5 CLEAN POWER DEVELOPMENT OPTIONS..............................................63

5.1 LEGS-MCPD Scenario..........................................................................64
5.2 LEGS-ACPD Scenario...........................................................................68
5.3 HEGS-MCPD Scenario .........................................................................71
5.4 HEGS-ACPD Scenario..........................................................................75
6 CONCLUSIONS AND RECOMMENDATIONS ............................................81

6.1 Energy Planning .....................................................................................81
6.2 Transmission and Distribution Development .....................................82
6.3 Rules and Regulation ............................................................................82
6.4 Incentive Programs ................................................................................83
7 REFERENCES ...................................................................................................84
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LIST OF FIGURES
Figure 2.1 Practical Wind Resources in the Philippines .....................................23

Figure 2.2 Practical Small Hydro Resources in the Philippines.........................27
Figure 3.1 Electricity Consumption by Sector, 2001............................................39
Figure 3.2 Electricity Consumption, Gross Domestic Product and
Population, 1991-2001 ..........................................................................39
Figure 3.3 Electricity Generation by Grid, 1991-2001 .........................................40
Figure 3.4 System Peak by Grid, 1991-2001........................................................40
Figure 3.5 Total Installed Generating Capacity by Source, 1999-
2001..........................................................................................................41
Figure 3.6 Carbon Dioxide Emissions by Fuel Type, 1999-2001 ......................43
Figure 3.7 Energy Mix, 1999-2001 .........................................................................44
Figure 3.8 Share of Renewable and Non-Renewable Energy in
the Energy Mix, 1999-2001...................................................................45
Figure 3.9 Energy Mix and Carbon Dioxide Emissions, 1991-
2001..........................................................................................................45
Figure 4.1 National Energy Planning Process ......................................................49
Figure 4.2 Generation under the Low Economic Growth Scenario...................50
Figure 4.3 DOE Plan for Installed Capacity for the Low Economic
Growth Scenario.....................................................................................51
Figure 4.4 Energy Mix for the DOE Plan for the Low Economic
Growth Scenario.....................................................................................53
Figure 4.5 Coal and Oil-Based vs. Renewable and Natural Gas
Energy Mix for the DOE Plan for the Low Economic
Growth Scenario.....................................................................................53
Figure 4.6 Fossil Fuel Consumption for the DOE Plan for the
Low Economic Growth Scenario..........................................................55
Figure 4.7 Carbon Dioxide Emissions for the DOE Plan for the
Figure 4.8 Generation under the High Economic Growth
Scenario...................................................................................................57
Figure 4.9 DOE Plan for Installed Capacity for the High
Economic Growth Scenario ..................................................................58
Figure 4.10 Energy Mix for the DOE Plan for the High Economic
Growth Scenario.....................................................................................59
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Figure 4.11 Share of Renewable and Non-Renewable Energy in

the Energy Mix for the DOE Plan for the High
Figure 4.12 Fossil Fuel Consumption for the DOE Plan for the
High Economic Growth Scenario.........................................................60
Figure 4.13 Carbon Dioxide Emissions for the DOE Plan for the
Figure 5.1 Installed Generating Capacity for the LEGS-MCPD
Scenario...................................................................................................65
Figure 5.2 Energy Mix for the LEGS-MCPD Scenario ........................................66
Energy Mix for the LEGS-MCPD Scenario ........................................66
Figure 5.4 Fossil Fuel Consumption for the LEGS-MCPD
Scenario...................................................................................................67
Figure 5.5 CO2 Emissions for the LEGS-MCPD Scenario..................................67
Figure 5.6 Installed Generating Capacity for the LEGS-ACPD
Scenario...................................................................................................69
Figure 5.7 Energy Mix for the LEGS-ACPD Scenario .........................................69
Energy Mix for the LEGS-ACPD Scenario .........................................70
Figure 5.9 Fossil Fuel Consumption for the LEGS-ACPD
Scenario...................................................................................................70
Figure 5.10 CO2 Emissions for the LEGS-ACPD Scenario ..................................71
Figure 5.11 Installed Generating Capacity for the HEGS-MWPP
Scenario...................................................................................................73
Figure 5.12 Energy Mix for the HEGS-MCPD Scenario........................................73
Energy Mix for the HEGS-MCPD Scenario........................................74
Figure 5.14 Fossil Fuel Consumption for the HEGS-MCPD
Scenario...................................................................................................74
Figure 5.15 CO2 Emissions for the HEGS-MCPD Scenario.................................75
Figure 5.16 Installed Generating Capacity for the HEGS-ACPD
Scenario...................................................................................................77
Figure 5.17 Energy Mix for the HEGS-ACPD Scenario ........................................77
Energy Mix for the HEGS-ACPD Scenario ........................................78
Figure 5.19 Fuel Consumption for the HEGS-ACPD Scenario............................78
Figure 5.20 CO2 Emissions for the HEGS-ACPD Scenario..................................79
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LIST OF TABLES
Table 1.1 Cost Comparison of Power Plants......................................................... 2

Table 1.2 Typical Capacity Factors of Power Plants
and Levelized Generation Costs............................................................ 2
Table 2.1 1994 Philippine Greenhouse Gas Emissions by Sector ..................13
Table 2.2 1994 Greenhouse Gas Emissions from the
Philippine Energy Sector .......................................................................13
Table 2.3 Philippine Wind Electric Potential ........................................................22
Table 2.4 Practical Wind Resources in the Philippines .....................................22
Table 2.5 Available Large Hydro Resources .......................................................25
Table 2.6 Philippine Small Hydro Electric Potential ...........................................26
Table 2.7 Practical Small Hydro Resources in the Philippines.........................26
Table 2.8 Small Hydro Power Sites Verified by the DOE ..................................26
Table 2.9 Projected Supply of Biomass Resources ...........................................28
Table 2.10 Philippine Bagasse Electric Potential..................................................30
Table 2.11 Available Geothermal Resources for Power Generation.................31
Table 2.12 Philippine Natural Gas Resources.......................................................32
Table 2.13 Cost Comparison of Power Plants.......................................................33
Table 2.14 Typical Capacity Factors of Power Plants
and Levelized Generation Costs..........................................................34
Table 2.15 Value of Air Emissions Reductions in California ...............................36
Table 2.16 Carbon Dioxide Emissions of Different Power Plant Types ............36
Table 2.17 Emission Factors for Various Power Plants .......................................36
Table 3.1 Energy Consumption by Sector, 1991-2001 ......................................38
Table 3.2 Reserve Margin, 1991-2001 .................................................................42
Table 3.3 Historical Environmental Emissions for
the Philippine Power Sector .................................................................42
Table 3.4 NPC Average Electricity Rates, 1991-2001 .......................................46
Table 3.5 NPC and IPP Production Cost at 1990 Constant
Prices........................................................................................................47
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Table 4.1 Low and High GDP Forecasts for 2003 to 2012 ...............................49
Table 4.2 Percentage Reserve Margin for the DOE Plan for the
Table 4.3 Environmental Emissions for the DOE Plan for the
Table 4.4 Generation Costs for the DOE Plan for the Low
Economic Growth Scenario, 2003-2012.............................................56
Table 4.5 Percentage Reserve Margin for the DOE Plan for the
Table 4.6 Environmental Emissions for the DOE Plan for the
Table 4.7 Generation Costs for the DOE Plan for the High
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LIST OF APPENDICES
Appendix A Wind and Hydro Potential in the Philippines

Appendix B Historical Performance of the Philippine Power Sector
1991-2001
Appendix C Economic Scenarios and DOE Plans for the Power Sector 2003-
2012
Appendix D Clean Power Development Options
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LIST OF ABBREVIATIONS
AWPP Aggressive Wind Power Penetration

BCF billion cubic feet
Btu British thermal unit
CC combined cycle power plant
CENECO Central Negros Electric Cooperative
CER Certificate of Emissions Reduction
CH4 methane
CO carbon monoxide
CO2 carbon dioxide
FFHC First Farmers Holdings Corporation
GHG greenhouse gas
GWh gigawatthour
HAEGS Historical Average Economic Growth Scenario
HEGS High Economic Growth Scenario
IPPs Independent Power Producers
ktonne kilotonne
kW kilowatt
LEGS Low Economic Growth Scenario
LOLP loss of load probability
MERALCO Manila Electric Company
MMBFOE million barrels of fuel oil equivalent
MWPP Moderate Wind Power Penetration
NMVOC non-methane volatile organic compound
NOx nitrogen oxides
NPC National Power Corporation
NREL National Renewable Energy Laboratory
N2O nitrous oxide
PPA purchased power adjustment
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SO2 sulfur dioxide

UNDP United Nations Development Programme
UPSL University of the Philippines Solar Laboratory
VMC Victorias Milling Company
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1 EXECUTIVE SUMMARY
1.1 Introduction
An area that has great potential for greenhouse gas (GHG) reduction is the power
sector. In 1994, the energy sector accounted for 50.038 million tonnes of the
100.738 million tonnes, or roughly 47 percent, of total net GHG emissions in the
country. Of the energy sector GHG emissions, the energy industries, mainly the
power industry, accounts for more than thirty (30) percent as a result of the burning
of fossil fuels. Although it ranks only second to the transport sub-sector in terms of
GHG emissions, the power sub-sector represents a large opportunity for carbon
emissions reduction and sequestration, given that clean energy technologies and
resources are available.
This study focuses on reliability, cost and environmental performance (particularly

GHG emissions) of the power sector. In particular it looks into scenarios that would
entail switching to clean energy technologies from conventional fossil fuel-based
technologies for grid-connected power generation.
1.2 Technology and Resource Assessment for Clean Power Development
This study has assessed the technologies and resources that could be used to
pursue clean power development in the Philippines.
Clean Energy Technologies
For the clean energy technologies, the assessment focused on technology measures
that reduce carbon intensity of energy (e.g., renewable energy technologies and
cleaner fossil-based technologies such as natural gas). Despite the high potential of
technology measures that reduce energy intensity, which could be treated as a
resource in energy planning, it is not used in this study because data available in the
Philippines is insufficient to do so.
The following are the clean energy technologies that could be utilized for clean
power development in the Philippines:
a) Wind Energy Conversion Systems;

b) Hydroelectric Power Plants;
c) Biomass Energy Conversion Systems;
d) Geothermal Power Plants; and
e) Natural Gas-Fired Power Plants.
Improved coal technologies, such as the circulating fluidized bed combustion

system, is considered as “relatively cleaner” only to pulverized coal plant technology.
Hence, if considered in power development with the objective of pursuing
environmental sustainability, these technologies will be at the bottom of the list.
Other renewable energy technologies were excluded on the basis of cost
competitiveness and/or maturity of technology.
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Cost Comparison of Power Generation Technologies
The economics of power generation technologies depends on several factors,

including: (a) investment cost, (b) operation and maintenance cost, (c) fuel cost, and
(d) the level of generation (also called capacity factor). Table 1.1 below shows the
costs used in this study. Screening curves (costs per kWh vs. capacity factor) were
developed based on the life cycle of each power generation technology and the four
economic factors mentioned above.
Table 1.1: Cost Comparison of Power Plants

Typical Annual
Investment Fuel Cost,
Type of Power Plant Economic Fixed O & M
Cost, $/kWa $/MWh
Life, years Cost, $/kWa
Oil-fired steam turbine 30 850 – 1,000 17 – 20 41.04
Oil-fired gas turbine 20 450 - 550 11 – 14 49.93
Oil-fired combined cycle gas
20 700 – 900 14 – 18 32.56
turbine
Diesel motors 20 550 – 650 14 – 16 73.10
Pulverized coal-fired power
30 1,200 – 1,400 30 – 35 11.40
plant
Fluidized bed coal power
30 1,750 – 1,800 44 – 45 9.12
plant
Wind technologies 20 1,000 – 1,250 20 – 25 0
Hydroelectric power plants 50 2,000 – 3,500 40 – 70 0
Fluidized bed combustors
30 1,750 – 1,800 44 – 45 3.53
(for biomass)
Geothermal technologies 50 1,150 – 1,500 29 – 38 0
Gas-fired combined cycle
20 700 – 900 14 – 18 36.68
gas turbine (for natural gas)
Table 1.2: Typical Capacity Factors of Power Plants and Levelized Generation
Costs1
Capacity Factor Levelized Generation Cost
Power Plant Type
(%) $/kWh PhP/kWh
Geothermal 88 0.0193 1.0602

Coal (Pulverized coal plant) 82 0.0405 2.2282
Hydro 57 0.0494 2.7153
Oil-fired steam turbine 54 0.1059 5.8236
Natural gas combined cycle 54 0.0794 4.3644
Oil-fired gas turbine 31 0.1101 6.0557
Wind
Without ancillary services 30 0.0512 2.8174
With ancillary services 30 0.0625 3.4376
Diesel 9 0.2277 12.5219
1
A discount rate of 12% was used to derive levelized generation costs. Actual industry discount rates
may be higher depending on the following factors: required equity return, market risks, regulatory
risks, country risks and availability of financing.
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The above screening curve table was used in preparing the alternative power
development plans in this study. The figures used are only intended for relative
comparison.2 It can be noted that on life-cycle basis, renewable energy technologies
can be competitive with conventional fossil fuel-based technologies. However, most
power developers are biased to fossil-based power plants because of its
comparative advantage in terms of investment cost and shorter recovery period.
Thus, the need for policy instruments and mechanisms that will create a more
secured investment climate for renewable energy developers cannot be over-
emphasized.
Environmental Externalities
A number of studies have attempted to put a cost on the various externalities caused
by power generation using the abatement cost or the damage cost approach. The
abatement cost approach uses the cost of pollution control as a proxy to the true
externality cost. On the other hand, the damage cost approach puts a value on the
damages that may be directly attributable to a particular pollutant. Studies vary in
their estimation of externality costs because of a number of factors, including site
specificity (e.g., geographical and climatological conditions), population density,
emissions reduction policy, scope of analysis, among others.
In this study, abatement cost values for the North Coast of California, which has the
lowest abatement costs among the districts of California, were used to compute for
the cost of externalities of the different power development plans. These figures
were used in the absence of actual abatement cost assessment for the Philippines.
Moreover, abatement technologies, if required in the Philippines’ power generation
sector, will be imported from developed countries such as U.S.A or Europe. It is
therefore deemed reasonable to use the lowest available value in developed
countries for purposes of evaluating the prospective performance of a power
development plan.
It can be concluded that if environmental externalities will be considered, clean

renewable energy technologies will be the least cost option for power development in
the Philippines
Clean Indigenous Energy Resources
Energy resource assessment was conducted based on secondary data to quantify

the available indigenous resources that can be utilized by the clean energy
technologies as “fuel”. Assessment was made for wind, hydro, biomass, geothermal
and natural gas resources for power development.
Resource assessment and mapping conducted in the past for the Philippine
archipelago have shown that the country has a big wind power potential. The
National Renewable Energy Laboratory (NREL) has estimated that there are 76,600
MW of installed wind power capacity in the Philippines that can generate about
2
True costs will vary for a number of reasons, including variability of fuel costs, dollar discount rates,
among other things. Further, these costs do not include site development costs, connection to the
transmission system, transformer costs and taxes. These costs were derived using only the cost of
the power plant technology, operations and maintenance cost and fuel costs.
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195,200 GWh of electricity per year. For the purposes of this study, a re-analysis of
the NREL wind mapping data was conducted. Additional screening criteria were
imposed to determine practical and viable wind power sites. This include considering
only sites with power density of at least 500 W/m2. This first criterion reduced the
number of wind sites to 2,092 with an aggregate potential of 14,323 MW. A second
criterion that relates to grid connection costs was also used. The transmission
system of the National Transmission Company (TransCo) was overlaid to the GIS -
based wind resource map to determine the proximity of the sites to the grid. Only
those sites whose connection (i.e., construction of transmission lines) will cost up to
25% of the total life-cycle cost were considered. The application of the second
criterion further reduced the number of sites to 1,038 with 7,404 MW potential.
A re-analysis of the NREL small hydro resource assessment was also conducted.
Selecting only the sites with capacities of 5 MW or more as criterion, the UPSL
identified 236 small hydro sites in the country with an aggregated capacity of about
2,308 MW. Using the second screening criterion similar to that use in the wind
resource assessment, (i.e., limiting the transmission investment cost to 25% of total
investment cost) resulted to the elimination of three sites from the small hydro
resource pool.
Of all the biomass resources in the country, UPSL considered only bagasse from
sugarcane processing as practical resource for grid connection. Other biomass
resources are still facing problems or issues like collection, storage, and competing
uses to be viable for large-scale power generation. UPSL estimates the electric
power potential of bagasse at 235.7 MW. This potential is spread all over the country
where sugar centrals are situated.
The Philippines power sector largely depends on geothermal energy to meet the
demand and energy requirements of the country. In 2001, total geothermal installed
capacity amounted to 1,931 MW, which generated a total of 10,442 GWh. This
accounts for 14% and 22% of the total installed capacity and total generation,
respectively in the country. In addition to existing geothermal power facilities, an
estimated capacity of 1,200 MW that could generate about 8,935 GWh annually can
be obtained from additional verified geothermal sites in the Philippines.
A few natural gas finds in the Philippines have been made, the most significant of
which is that found in Malampaya and San Martin in Palawan, with a combined
estimated reserves of 2,771 to 4,731 billion cubic feet (BCF). The Philippine
government is considering plans to develop a local natural gas industry. If this
pushes through, local natural gas production would be supplemented by imported
natural gas.
1.3 Historical Performance of the Philippine Power Sector
The performance (in terms of reliability, cost and environmental emissions,) of the
Philippine power sector from the period beginning 1991 to 2001 was also assessed
in this study.

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Energy Demand and Installed Capacity
The Philippines electricity consumption posted a moderate growth rate of 8.3%

annually from 1991 to 2001. The industrial and residential sectors, accounting for
31% and 29% energy share for the year 2001, respectively, are the biggest users of
electricity. The commercial sector accounts for 21% of the total consumption for
2001. The rest are attributed to own use, losses and miscellaneous uses. It should
be noted however, that the industrial sector demand grew only by 5.5% while that of
the residential sector grew by 11.7% annually for the 11-year period. Geographically,
the energy demand in the country was distributed among the three (3) main islands
of Luzon, Visayas and Mindanao. Bulk of the energy demand and consequently the
generation comes from the main island of Luzon. In 2001 for example, the Luzon
Grid has a share of 36,184 GWh of the total 47,049 GWh energy generation which
represents 77% of the requirements of the country. Visayas and Mindanao share the
remaining balance almost equally.
In order to meet the growing demand for electricity, the installed generating capacity
in the country doubled in 11 years with 6,789 MW in 1991 to 13,402 MW in 2001.
Historical Reliability Performance
To analyze the reliability performance of the power system in the Philippines, the
reserve margin (i.e., generating capacity compared to the system peak) from 1991 to
2001 was determined from historical data. The analysis has shown that the
generating facilities in the early 1990’s were performing very badly from the point of
view of reliability. However, from mid 1990’s onward, the Philippines power sector
performance went to the other extreme of having excessive capacity compared to
the demand. This validates the clamor of the people regarding high electricity rates
which is due to oversupply since most of the generating facilities are operating under
the take-or-pay contract with the National Power Corporation (NPC) and other
distribution utilities.
It can be concluded, therefore, that the generating capacity of the power system in
the Philippines can be considered highly reliable. The interruptions that the country
has been experiencing can be attributed to the unreliable transmission and
distribution systems and their operations.
Historical Cost Performance
This study also assessed the power development in the Philippines by analyzing the
cost of electricity. It was noted that the rates of NPC is for its bundled generation and
transmission services. For purposes of this study, these rates were unbundled into
76% and 24% for generation and transmission, respectively. The rates of NPC
appear to be increasing annually except for the year 2001 when R.A. 9136 (Electric
Power Industry Reform Act) was enacted and the national government has
intervened in the market due to the growing clamor against the Purchase Power
Adjustments (PPA) in the electric bills. The increase in rates is attributed to the
economic performance of the country (as exhibited by the exchange rates) and due
to the take-or-pay contracts of NPC with Independent Power Producers (IPPs).

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Records also show that the production cost of IPPs were always higher than the
NPC rates. This contradict the avoided cost principle of the NPC IPP Program that
IPP power development project proposals will be accepted as it offer electricity at
prices lower than or at least equal to NPC rates.
Comparing the average rate of NPC with that paid by the consumers, which range
from PhP 4.00 to PhP 6.00 per kWh, there is difference of PhP 1.00 to PhP 3.00 per
kWh. This considerable difference can be attributed to the cost of distribution and to
the PPA of IPP’s that sell electricity directly to the distributors.
It is also worthwhile to note that with the existence of the Non-NPC IPPs (permitted
to operate through Executive Order 215), particularly those owned by electricity
distributors like Manila Electric Company (MERALCO), many power plants were
installed even though there were already excess generation capacity in the system.
The main culprit here is that the IPPs’ return on investments were guaranteed by the
take-or-pay contracts with NPC and the distribution utilities. This indicates the poor
coordination of the plans of the IPPs that deal directly with Distributors in the context
of centralized planning of the government, particularly the NPC.
Historical Environmental Performance
The environmental performance of the Philippine power sector from 1991 to 2001
(measured in terms of the amount of gases and particulates that are emitted by the
electric power generating plants) shows that CO2 emissions increased by 74 percent
while the rest of the air emissions increased by 10 to 169 percent.
For the CO2 emissions, coal power plants are the major contributors. Its contribution
increased almost ten times from 1,082,279 tons in 1991 to 10,471,222 tons in 2001.
CO2 emissions from oil-based power plants, on the other hand, decreased by 21
percent from its level of 9,236,541 tons in 1991 to 7,338,665 tons in 2001.
Accounting the changes in oil and coal, the net increase in CO2 for the 11-year
period is 73%.
Looking into the energy mix to link the environmental performance of the power
sector, it can be concluded that that non-renewable energy have remained greatly
dominant over renewable energy as source of fuel for power generation. The share
of non-renewable sources in the energy mix even increased from 57.49% in 1991 to
62.71% in 2001. Over the period considered, generation share from oil-based power
plants declined from 49.9% in 1991 to 21.9% in 2001. However, coal contribution
increased more than fivefold, from 8% in 1991 to 40% in 2001. In addition,
renewable hydro share decreased from 20% to 5% over the same period. This
scenario allowed the continued dominance of non-renewable fuels.
Clearly, the shift is only towards the use of coal, which emits more greenhouse
gases, and not towards the utilization of renewable resources. This explains why the
emissions of the power sector almost doubled in only 11 years.

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1.4 Scenarios under the Philippine Energy Plan 2003 - 2012
The prospective performance of the Philippine Power Sector was also assessed
based on the Philippine Energy Plan 2003 – 2012 prepared published by the
Department of Energy. Reliability, environmental emissions and costs were
calculated similar to that of the historical performance assessment.
PDP for the Low Economic Growth Scenario
The PEP, based on the low economic growth projections of NEDA, shows that
energy generation will increase by 93% (55,142 GWh in 2003 to 106,430 GWh in
2012) over the entire period at an average rate of 7.57% annually. Total installed
capacity of 14,632 GW for 2003 will increase to 20,706 MW by 2012. The increase in
demand will be met mostly by increases in coal power plants (3,500 MW) and oil-
based plants (1,775 MW). The increase in the share of renewable energy generating
capacity will come from a 795 MW large hydro, 65 MW wind and a 40 MW
geothermal capacity additions. No additional capacity addition for natural gas is
expected in the period. Capacity additions, operations and maintenance and fuel
would require a total cost $ 23,828 million (UPSL estimate at 2002 present value).
In terms of reliability, the planned capacity additions will result in high reserve
margins. For example, the reserve in 2003 will be 66%. Although this is expected to
decline to 22% by 2012, it is still unrealistic to expect that cost of electricity in the
Philippines in the near term will decrease under this scenario.
While the generation cost for this scenario is estimated at PhP 3.16/kWh, the
Purchased Power Adjustment (PPA) component in the electricity bills of the end
users is still expected to result in higher cost due to the high reserve margins.
To meet the energy requirements, this scenario would require 124.5 million barrels
fuel oil equivalent (MMBFOE) of oil, 91.9 million tonnes of coal and 1,263 billion
cubic feet (BCF) of natural gas. Of these amounts, 124.5 MMBFOE of oil and 80.2
million tonnes of coal would have to be imported.
The environmental emissions resulting from DOE’s generation plan for the low
economic growth scenario would result in an increase in CO2, SOx and other
emissions. Total CO2 emissions for the DOE plan for the low economic growth
scenario is 309.3 million tonnes. The increase in the use of coal will account to
contributing 55% of the total CO2 emissions for the period. Oil-based and natural gas
plants will contribute 17% and 26% to the CO2 emissions, respectively. Geothermal
plants will contribute only 2%. These emissions will be the direct result of the share
of coal, natural gas and oil-based sources in the energy mix which is 34%, 24% and
4%, respectively for year 2003. From a share of 37% in 2003, renewable energy’s
share will decrease to only 22% in 2012. The contribution of non-renewable energy
sources to the energy mix, on the other hand will increase by 24%, with the
continued dominance of coal plants. This scenario will require $ 29,368 million in
abatement cost.

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The PEP under the Low GDP Scenario reflects the continued preference on the use
coal. Notably, this plan can be judged as a business-as-usual plan that will only
replicate (or be even worse than) the historical performance of the Philippine power
sector from the point of view of sustainable development.
PDP for the High Economic Growth Scenario
The DOE also prepared a power development plan based on high economic growth
projections of NEDA. Analysis of the PEP under this scenario indicates that the plan
is also a business-as-usual plan that will perform no better than the historical
performance of the Philippine power sector, nor the scenario for the low economic
growth.
The following performance indicators can be expected if this scenario push through:
a) Installed capacity: 14,632 MW in 2003 to 22,756 MW in 2012

(56% increase for the 10-year period)
b) Energy generation: 55,556 GWh in 2003 to 118,470 GWh in 2012
(213% increase for the 10-year period)
c) Reserve Margin: 25% (minimum) to 65% (maximum)
d) Energy Mix: Coal - 16% in 2003 increase to 47% in 2012
Oil - 5% in 2003 increase to 16% in 2012
Natural gas - 24% in 2003 decrease to 17% in 2012
R.E. - 37% in 2003 decrease to 20% in 2012
With the continuous decline in the share of renewable energy, within the planning
period, greenhouse emissions is expected to further soar, increasing by 195% from
2003 to 2012, and will require $ 32,995 million in abatement cost.
1.5 Clean Power Development Options for the Philippines
Using the clean energy technologies and resources, two (2) alternative power
development plans (or strategies) that will meet the demand of the Low Economic
Growth Scenario and the High Economic Growth Scenario of the PEP were prepared
by UPSL. These strategies are the following:
• Moderate Clean Power Development (CCPD) Plan
In this plan, capacity addition and utilization of renewable energy (geothermal,

biomass, wind and hydro power) and natural gas plants are given priority over
that of non-renewable plants for power generation. Total installed capacity of
wind power plants is allowed to reach a maximum of 5% of the peak demand.

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• Aggressive Clean Power Development (ACDP) Plan
For this plan, the strategy is to utilize all the practical renewable energy
resources where possible without caps. Cost penalties for intermittent power
plant capacity beyond 5% (based on peak demand) was also imposed to
account for the additional ancillary services.
It was assumed in these plans that the local natural gas industry will be able to
supply fuel for up to 3,800MW natural gas power plants (maximum generation of
23,000 GWh annually) for the next twenty years. The additional natural gas
requirement will be supplemented by imports from the neighboring Asian countries
and other natural gas producers until new local resources are developed.
For all the plans, the 2003 to 2007 capacity additions were based solely on the PEP
list of committed projects. The percentage installed reserve margin for the years
2008 onwards is kept as close as possible to the corresponding PEP reserve
margins for comparison. Note, however, that these reserve margins do not take into
account the ancillary diesel engines, which serve as frequency regulating plants for
the wind power plants. Assuming a five-year lead-time for the planning to
commissioning of the additional power plants, the capacity additions starts only in
2008.
In this summary, only the power development plan to meet the Low Economic
Growth Scenario of the PEP 2003 – 2012 is presented. The plans that correspond to
the High Economic Growth Scenario are detailed in Chapter 5.
Moderate Clean Power Development (MCPD) Plan
To meet the demand of the Low Economic Growth Scenario, this plan will increase
the renewable energy plant installed capacity by 95% (from 4,450 MW in 2003 to
8,685 MW in 2012) and the natural gas plant capacity by 117% (from 2,763 MW in
2003 to 5,983 MW in 2012). This translates to a 69% total installed capacity for the
combined natural gas and renewable energy plants.
The share of renewable energy in the energy mix will increase from 37% to 41%,
from the period 2003 to 2012. The natural gas contribution will also increase from
24% to 31%. This will translate to a 72% total share of clean energy in the energy
mix by 2012. The share of coal and oil in the mix will be reduced by about 11% at the
end of the period.
This plan will reduce the GHG emissions and abatement costs for the Low GDP
Scenario by 14% and 21%, respectively, as compared with the PEP. Total CO2
reduction as compared with the PEP is 44.6 million tonnes.
The total cost calculated for this plan is $23,592 million and the average generation
cost is PhP 3.12/kWh. This average generation cost is even cheaper than that of the
PEP Low GDP scenario, which is PhP 3.16/kWh.
Considering the investment, O&M and fuel costs, this plan will save $235 million in
the planning period.

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Aggressive Clean Power Development (ACPD) Plan
To meet the demand of the Low Economic Growth Scenario, the ACPD plan will
increase the renewable energy plant installed capacity by 159% (from 4,450 MW in
2003 to 11,520 MW in 2012) and the natural gas plant capacity by 95% (from 2,763
MW in 2003 to 5,383 MW in 2012). This translates to a 79% total installed capacity
for the combined natural gas and renewable energy plants.
The share of renewables in the energy mix will increase from 37% to 48%, from the
period 2003 to 2012. The natural gas contribution will also increase from 24% to
31%. This will translate to a 79% total share of clean energy in the energy mix by
2012. The share of coal and oil in the mix will be reduced by about 20% at the end of
the period.
This plan will reduce the GHG emissions and abatement costs under the PEP Low
GDP Scenario by 18% and 27%, respectively.
The total cost calculated for this plan is $23,881 million and the average generation
cost is PhP 3.17/kWh. This is comparable to the PEP Low GDP scenario, which is
PhP 3.16/kWh but five centavos (PhP 0.05) per kWh more expensive than the
Moderate Clean Power Development Plan due to the additional ancillary services for
the intermittent wind power supply.
Considering the investment, O&M and fuel costs, this plan will cost an additional
$41M in the planning period compared to the PEP low GDP plan. This translates to a
mitigation cost of $0.67/tonne of CO2. With the current price of CO2 at $2 - $10 per
tonne, this plan will create an opportunity for the country in the carbon market.
1.6 Conclusions and Recommendations
The Philippine power sector from 1991 to 2001 has not performed very well in terms
of reliability and cost to end-users. While the PEP has tried to address these
problems, it fails to consider the implications of the activities in this sector to the
environment that could even be more important if only the externalities will be
considered in the economics of energy supply.
This study has assessed the technologies and resources in the Philippines that could
be tapped for clean power development. To avoid significant amounts of GHG
emissions in the future, the country has to resort to biomass, small hydro, wind and
natural gas technologies, as was done in this study. To support power switching,
new natural gas sites must be identified and developed. In addition, natural gas
importation may be pursued.
This study also offers two alternative paths (moderate and aggressive) through the
alternative clean power development plans. These alternative plans are comparable
to the PEP in terms of costs. There are even opportunities that can create additional
dollar income from carbon trading and local employment. At the current CO2 prices
($5 per tonne) in the market, the Moderate Clean Power Development Plans are
viable greenhouse gas mitigation option for the Philippines offering so many

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opportunities both for the developers and the country. Switching to cleaner energy,
therefore, is attractive as the price of carbon is expected to increase in the future.
Pursuing Clean Power Development plans requires the development of a “clean

energy” market in the country through effective policy instruments and mechanisms
that will secure the investment climate while protecting public interest. A set of
measures that should be made to attract more investments in renewable generation
technologies in the future discussed below.
Energy Planning
The first step in developing the market for clean energy is to introduce reforms in the
process of energy planning itself. Since power developers will only respond to the
government call, it is important that the Philippine Energy Plan reflect the call for
clean power development. This could be achieved through the following:
• Improve the power development planning models
- Include environmental externalities in planning models to reflect the true

cost to society of energy decisions;
- Consider the economics of smaller capacity, following load growth to deal
with the overcapacity issue (in contrast to large capacity power plants
currently used in energy planning);
- Include energy efficiency as a demand side option in energy planning
models;
- Use coal-fired fluidized combustion technology as benchmark fossil-based
plant instead of pulverized coal;
- Increase the number of candidate Renewable Energy-based Power Plants
in the selection process. To increase the number of candidate renewable
energy plants in planning, more rigorous and site-specific resource
assessment must be conducted.
• Institutionalize a participative planning process. A decentralized planning process
down to the level of the local government and participated by the stakeholders in
the locality should complement the top-down planning process at the national
level. Electrification planning can be done in the municipality/city levels. Resource
assessment and local supply and demand balance can be done at the provincial
level. This decentralized planning scheme will result in a more realistic demand
forecast and will address local issues on energy, as well as issues on under- and
overcapacity. While this planning process allows for a greater degree of public
participation, it will also entail capacity building for local government units in the
areas of planning and resource assessment.
Transmission and Distribution Development
Transmission and distribution infrastructure should be developed to increase access

to renewable energy sites, most of which are site specific. Transmission facilities
should deliberately be expanded toward locations of promising renewable energy
sources.
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The cost of such an expansion should be borne by the transmission or distribution

utility. This cost mechanism will ensure that all electricity consumers will share the
cost of such a development. The Energy Regulatory Commission (ERC) should
allow such an expansion even if it does not initially show recovery of investment.
Rules and Regulation
• The Wholesale Electricity Spot Market (WESM) Rules must provide that
intermittent and small-scale grid-connected renewable energy generation
systems (such as wind, run-of-river small hydro and biomass) should be given
priority in the dispatch of generating units. These plants must “feed-in” the Grid at
minimum prices that will guarantee the returns of power developers.
• The System Operator should be allowed to procure ancillary services needed by
the Grid to accommodate intermittent wind power and pass on the cost to all
users of the Grid.
• The Philippine Grid and Distribution Code (PGDC) must be clear on its
requirements and procedures on the connection, operation and control of non-
conventional, renewable energy-based power plants, particularly on the required
technical analysis and compensating equipment.
Incentive Programs
• The Department of Energy must ensure that renewable energy development

should always be included in the Philippine Investment Priorities of the Board of
Investment to ensure that the fiscal (e.g., tax exemptions, income tax holidays
and tax credits) and non-fiscal (e.g., simplification of custom procedures and
importation of consigned equipment) will be available for renewable energy
developers.
• An assistance program should be created for renewable energy development.
This may include subsidy for resource assessment and feasibility studies for
serious developers of renewable energy.
• Dedicated Financing Windows that allow longer repayment periods for renewable
energy-based development.

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2 ENERGY TECHNOLOGIES AND RESOURCES FOR CLEAN POWER
An area that has great potential for greenhouse gas (GHG) reduction is the power
sector. In 1994, the energy sector accounted for 50,038 ktonnes of the 100,738
ktonnes, or roughly 47 percent, of total net GHG emissions in the country, as shown
in Table 2.1. Of the energy sector GHG emissions, the energy industries, mainly the
power industry, accounts for more than thirty (30) percent as a result of the burning
of fossil fuels, as shown from Table 2.2. Although it ranks only second to the
transport in terms of GHG emissions, the power sub-sector represents a large
opportunity for carbon emissions reduction and sequestration, given that clean
energy technologies and resources are available.
Table 2.1: 1994 Philippine Greenhouse Gas Emissions by Sector

(equivalent ktonne CO2)
SECTOR CO2 CH4 N2O Total

Energy 47,335 1,985 717 50,038
Industry 10,596 7 0 10,603
Agriculture 20,800 12,330 33,130
Waste 0 6,140 954 7,094
Land Use & Forestry -2,774 2,403 245 7,094
TOTAL EQUIVALENT CO2
55,157 31,335 14,246 100,738
EMISSIONS
Source: The Philippines’ Initial National Communication on Climate Change
Table 2.2: 1994 Greenhouse Gas Emissions from the Philippine Energy Sector*
(equivalent ktonne CO2)
SECTOR CO2 CH4 N2O Total

A. Fuel Combustion Activities 47,335 1,759 717 49,811
3
1. Energy Industries 15,458 11 40 15,509
2. Manufacturing Industries 8,980 170 347 9,497
3. Transport 15,801 45 43 15,890
4. Commercial/Institutional 3,368 1 0 3,369
5. Residential 2,544 1,529 285 4,359
6. Agriculture 1,185 2 3 1,190
B. Fugitive Emissions from Fuels 226.59 227
1. Coal Mining 216.72 217
2. Oil 9.87 10
TOTAL EQUIVALENT CO2 EMISSIONS 50,038
* does not include emissions from biomass
Source: The Philippines’ Initial National Communication on Climate Change
3
The University of the Philippines Solar Laboratory (UPSL) calculated a slightly different value from
that of the Philippines’ Initial National Communication on Climate Change. The UPSL came up with
13,548 ktonnes of CO2 for the Energy Industries for the year 1994.
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This study focuses on the reliability, cost and environmental performance

(particularly on GHG emissions) of the power sector. In particular, it looks into
scenarios that would entail switching to clean energy technologies from conventional
fossil fuel-based technologies for grid-connected power generation.
In the sections that follow, technologies and resources that could be used to reduce
GHGs from the power sector shall be discussed and evaluated to determine what
could be used in the Philippine power sector.
2.1 Clean Energy Technologies
Clean energy technologies are those that result in relatively fewer GHG emissions
per unit of energy service delivered as compared to conventional technologies.
These technologies may be classified as4:
• measures that reduce the energy intensity of the economy (e.g., energy
conservation, improvement of power plant heat rates);
• measures that reduce the carbon intensity of energy (e.g., renewable
energy technologies); and
• measures that integrate carbon sequestration into the energy production
and delivery system.
These technologies may be an attractive alternative to conventional fossil fuel-based

generation technologies in terms of its environmental benefits. However, they must
compete with the same technologies in terms of other criteria such as cost, resource
availability and technology maturity before application on a significant scale could be
expected.
In the following sections, a number of clean energy technologies shall be discussed.

These technologies will then be evaluated to determine their viability for the
Philippine power sector.
Measures that Reduce Energy Intensity
One way of reducing the energy intensity of the economy is by minimizing energy
losses in the system. In power generation, improvements could be made to improve
the efficiency of existing power plants by decreasing their heat rates, i.e., the heat
energy in Btu required by the power plants to produce a kilowatt-hour of electric
energy. This is done by looking at ways to improve the performance of existing
power plant components like boilers, turbines and generators. This measure is a
cost-effective method of achieving CO2 reductions in that it would not entail large
costs for equipment although it would require capability-building activities. The
Philippines Department of Energy (DOE) has already started a Heat Rate
Improvement Program, which is expected to achieve a substantial amount of energy
savings.
4
Marilyn A. Brown, Mark D. Levine and Walter D. Short, Scenarios for a Clean Energy Future, (U.S.:
Interlaboratory Working Group on Energy-Efficient and Clean Energy Technologies), p. 1.2
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Another measure is the use of efficient end-use devices. Improved technologies for
electricity-consuming end-use devices are available in the market like more efficient
motors, lighting technologies, refrigerators and air conditioners. In a study made by
Leverage International (Consultants) Inc. on the characterization of new commercial
buildings in the Philippines, it was mentioned that energy savings amounting to 39%,
32% and 10% could be realized from more efficient air conditioning, lighting and
other office equipment, respectively5. In the industrial sector, potential energy
savings could be realized in the use of high efficiency motors. A study conducted in
1994 estimated energy savings amounting to 423 GWh and about 74 MW of
capacity could have been realized by the year 2010 in the Manila Electric Company
(MERALCO) franchise area6 alone had a high efficiency motors program been
implemented in 19977.
The DOE has for some time been implementing an efficiency and energy-labeling
and standard program to help consumers select electric appliances and equipment.
The program includes the Efficiency Standard and Labeling for Room Air
Conditioners, the Energy Labeling Program for Refrigerators and Freezers, the
Fluorescent Lamp Ballast Energy Efficiency Standard and the Performance
Certification of Fans and Blowers. The program is expected to achieve a potential
energy savings amounting to 9.7 MMBFOE from 2002 to 20118.
Despite the high potential of technology measures that reduce energy intensity,
which could be treated as a resource in energy planning, it is not used in this study
because data available in the Philippines is insufficient to do so.
Measures that Reduce the Carbon Intensity of Energy
For the electricity generation sector, technologies that reduce carbon intensity of
energy can be classified in a number of categories. These categories are not
absolute in that they sometimes overlap and some particular technology types fall
under two or more categories. They are as follows:
• Renewable energy technologies

These are technologies that harness the energy from renewable energy sources
for power generation. Renewable energies include solar, wind, hydro, biomass
and geothermal energies. Aside from it’s being clean, renewable energy sources,
because of its “inexhaustibility” addresses other challenges of the energy sector
such as sustainability and energy security.
5
Philippine New Commercial Building Market Characterization, (Philippines: Department of Energy,
1998), p. 9.
6
MERALCO is the distribution utility that services Metro Manila, Bulacan, Rizal, Cavite and parts of
the provinces of Laguna, Quezon, Batangas and Pampanga.
7
The study referred to is the Asian Development Bank-funded Long Term Power Planning Study
conducted by SRC in 1994, mentioned in the material for the March 12, 1998 meeting for the Motor
Energy Efficiency Enhancement Program.
8
Philippine Energy Plan 2002-2011, (Philippines: Department of Energy), p. 59.
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1. Wind Energy. The kinetic energy of the wind can be converted to mechanical
energy by means of a wind turbine. This mechanical energy can then be used
to run electric generators to produce electricity. Wind energy conversion
technology (WEC) is a mature technology, with worldwide installed capacity
totaling to 24,000 MW by the end of 2001.
Intermittent power would affect power system operability and stability and
therefore poses limitations on levels of penetration of wind power. Various
modeling studies show that wind generation capacities could amount from a
low value of 4% to a high value of 50% of system load9, depending on system
conditions. Utilities’ operational experience, particularly in the United States,
has been limited to low wind power penetration levels so far. Also, intermittent
generation will require additional ancillary services to be provided in the grid,
and therefore translates to higher electricity costs. For the Philippines, initial
estimates for wind penetration levels are between 5% and 20%. The
University of the Philippines Solar Laboratory (UPSL) is currently doing
studies to determine acceptable wind penetration levels considering
economics and the stability of the transmission system.
2. Hydro Power. Hydro power refers to the use of falling or flowing water for
power. It is a renewable form of energy because the energy of flowing water
ultimately comes from the sun. Water evaporation from the oceans and other
parts of the earth’s surface consumes about one fourth of the total solar
incidence on the planet. This water will return to the earth’s surface as
precipitation (e.g., through rain or snow) and part of it will eventually
contribute to the flow of streams, rives and falls.
Hydro power resources come in various sizes. The Philippines Department of

Energy (DOE) classifies hydro resources based on its potential capacity, as
follows: micro-hydro for hydro resources with capacities ranging from 1 to 100
kW; mini-hydro for those with capacities from 101 kW to 10 MW, and; large
hydro as those with capacities greater than 10 MW10.
Hydro power is considered a clean technology because it is renewable and

does not emit air pollutants. In some cases, it generates some amount of
GHG gases as a result of the rotting of organic matter that get submerged in
reservoirs, but the amount of emissions is small as compared to fossil fuel-
based electricity generation. The Canadian Hydropower association estimates
that GHG emissions from hydro facilities is 60 times less than that of coal
power plants and 18 times less than that of natural gas power plants11.
9
p. 49, Yih-huei Wan and Brian K. Parsons, Factors Relevant to Utility Integration of Intermittent
Renewable Technologies, (Colorado: National Renewable Energy Laboratory, 1993), p. 49.
10
The World Energy Commission uses a different classification from that used by the DOE, which are
as follows: micro hydro resources are those with capacities less than 100 kW; mini-hydro resources
are those with capacities ranging from 100 kW to 1 MW, and; small hydro resources are those with
capacities from 1 to 10 MW. Large hydro resources are those with capacities greater than 10 MW.
Thus, the Philippine definition of mini-hydro encompasses the WEC mini- and small-hydro resources.
11
Quick Facts, Canadian Hydropower Association
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Hydro power facilities offer other benefits such as low generation costs, high
efficiencies, little maintenance, long life and high levels of reliability. They are
– large hydro in particular - however, associated with a number of negative
impacts. Among them are:
Ecological Effects
a. Landscape destruction
b. Destruction of fish habitat and fisheries
c. Rearrangement of water resources
d. Increase in water pollution
e. Displacement/wiping out of plant and animal species
f. Silting
Social Impacts
A major negative social impact of large hydro projects is the dislocation

of population. Various hydro projects in the Philippines have dislocated
thousands. In the Philippines, the Agno River Basin Development
Program resulted in the loss of hectares of Ibaloy ancestral lands and
the subsequent dissolution of several Ibaloy communities. The
alteration of the local ecosystem also resulted in the loss of resource
base, which served as livelihood of the Ibaloys.
Risk and Safety
Major disasters involving dams have occurred in the past at 6 to 10

year intervals. With about 15,000 dams all over the world, the
frequency of disasters involving dams is 1 disaster for every 120,000
dam years. Speculation also arise that dams cause earthquakes in its
surrounding areas.
3. Biomass Energy. Like hydro and geothermal power, biomass energy is a

renewable resource that can be used for base load electric generation.
Technologies that can be used to generate power from biomass include
gasification-electric generation systems and burner technologies similar to
that used for coal.
4. Geothermal Energy. Geothermal energy refers to the heat stored in the

rocks within the earth. In places where the earth’s heat flow is concentrated,
this energy may be harnessed in the form of steam or hot water, which can
subsequently be used for power generation. Geothermal energy is not entirely
GHG emissions-free, but it emits far less greenhouse gases as compared to
fossil fuel-based counterparts.

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5. Solar Energy. Solar radiation may be converted to electricity by using solar

thermal engines or photovoltaic cells. Solar thermal engines make use of
solar concentration systems, which, as the name implies, concentrates the
power of the sun, to generate high enough temperatures to heat and boil
water to drive steam engines. Photovoltaics, on the other hand, convert solar
energy directly to electricity in a solid-state device called the solar cell.
• Clean coal technologies

Coal in itself is considered not a clean fuel because of the relatively high levels of
carbon dioxide and pollutant emissions resulting from its combustion as
compared with other fuels. Despite its unfavorable environmental reputation, coal
is still widely used around the world for power generation because it is abundant
and cheap. Various research and development efforts in the past three decades
have been successful in coming up with technologies that give better efficiencies
than the conventional pulverized coal technology or that convert coal into liquid or
gas fuels. Many such technologies have been demonstrated in various countries
but still remain not widely used because its high investment costs are quite
prohibitive. These include fluidized bed systems such as pressurized fluidized
bed combustion (PFBC) and circulating fluidized bed combustion (CFBC),
integrated gasification combustion cycle (IGCC) systems and coal-fueled diesel
engines. Clean coal technologies are costly, sometimes requiring around $3,000
per kilowatt of installed capacity.
• Gas turbines
Current gas turbine plants have efficiencies of around thirty percent. Newer
plants are actually achieving efficiencies greater than forty percent. But since this
type of plant is normally used for peak load applications, this would have a
relatively low impact on emissions reduction.
• Fuel cells
Fuel cells are devices that convert fuel and oxygen to electricity and heat by
means of an electrochemical reaction. For most fuel cells, hydrocarbon fuels
need to undergo a process of reforming to produce hydrogen, which is the form
of fuel required for the electrochemical reaction to take place. Fuel cells have
efficiencies ranging from 40 to 60 percent and could achieve very negligible
carbon and air pollutant emissions when paired with carbon separation
technologies. Costs are prohibitive, however, ranging from $2,000 to $4,000 per
installed kilowatt.
• Distributed energy technologies

Unlike centralized generating units, distributed energy technologies are small and
modular, with sizes ranging from a few kilowatts to a few megawatts. Distributed
energy technologies can be located on the site where the resource is available or
near the place where the energy is to be used. Greater local control of the system
and waste heat utilization lead to higher energy efficiencies, and thus, less GHG
and air pollutant emissions.

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Distributed power units could be connected directly to consumers or to the

transmission or distribution grid. These could provide standby generation and
base load generation, peak shave, and provide waste heat (cogeneration). And
because they are located near the load, transmission and distribution costs can
be reduced.
Technologies used for such applications include internal combustion engine-

generators, fuel cells, turbine generators and renewable technologies like solar
photovoltaics, wind turbines and microturbines. Through a process called
gasification, biomass fuels could also be used for distributed generation to
produce a gaseous fuel that can be burned in diesel- or gas motors or in gas
turbines.
• Improved fossil fuel-based technologies

Aside from clean coal technologies, newer and more efficient versions of
conventional fossil fuel-based technologies have been and are being developed
and designed.
• Natural gas technologies

Natural gas is a fossil fuel that has clean burning properties and lower CO2
emissions as compared to other fuels. Natural gas could be used to fuel a
number of power generating technologies, including combined cycle gas turbines
and fuel cells. Some of these technologies, particularly combined cycle gas
turbines, have investment costs that are competitive with other conventional
power generation technologies.
Measures that Integrate Carbon Sequestration
Carbon sequestration involves the capturing of carbon dioxide in the atmosphere or

keeping it from reaching the atmosphere. For the power sector, devices for carbon
sequestration use the process of adsorption of carbon dioxide on materials like
activated carbon, zeolites or inorganic membranes. Employing such devices in
power generation facilities would require significant capital cost and may thus
increase the cost of electricity.

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2.2 Resource Assessment
The technologies described above would be rendered useless without the energy
resource required to run them. The following sections will quantify the amount of
clean energy resources in the Philippines, which will then be subsequently used for
the generation of power switching scenarios.
Wind Power
The wind resource analysis and mapping study for the Philippine archipelago
conducted by the National Renewable Energy Laboratory (NREL) shows that the
country has plentiful wind electric potential. The NREL study identified around
10,000 sites in the country, occupying a total area of 11,055 km2 or roughly 3.34% of
total Philippine land area, with good to excellent resource levels - equivalent to an
annual average wind power of 300 W/m2 or greater12 (wind speeds of 6.4 m/s or
greater). According to the study13, these sites could support at least 76,600 MW of
installed capacity and generate 195,200 GWh/yr. Including sites with moderate wind
resource levels, amounting to 97,000 installed capacity, would more than double
total installed capacity to 173,600 MW bringing the total estimated power generation
from wind to 361,000 GWh/yr. The study, however, was not able to include factors
such as transmission and grid accessibility constraints in the assessment.
The NREL study identified six regions in the country where the best wind resource in
the country are located. These are:
1. the Batanes and Babuyan islands of north Luzon;

2. the northwest tip of Luzon (Ilocos Norte);
3. the higher interior terrain of Luzon, Mindoro, Samar, Leyte, Panay,
Negros, Cebu, Palawan, eastern Mindanao, and adjacent islands;
4. well-exposed east-facing coastal locations from northern Luzon southward
to Samar;
5. the wind corridors between Luzon and Mindoro (including Lubang Island);
6. between Mindoro and Panay (including the Semirara Islands and
extending to the Cuyo Islands).
In contrast to the optimistic estimate of the NREL, an earlier study by the United
Nations Industrial Development Organization (UNIDO) in 1994 puts the wind electric
power potential for the entire Philippines at a very conservative value of 250 MW14.
12 2
In one of the NREL scenarios, areas with annual wind power densities of 300 W/m or greater were
assumed to have sufficient potential for the economic development of utility-scale wind energy.
13
Assumptions used by NREL to come up with estimates are: 500 kW turbine size, hub height = 40
2
m, rotor diameter = 38 m, turbine spacing = 10D by 5D, capacity/km = 6.9 MW.
14
UNIDO, Assessment of Technical, Financial and Economic Implications of Wind Energy
Applications for Power Generation, (1994).
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Despite the vastness of wind resources in the country, current utilization are mostly
to run wind pumps and a few small-scale turbine generators. At present, there are
more than 500 wind pump and 9 wind turbine installations in the country. All wind
turbine installations are of the stand-alone type, among which are the following:
1. A 10-kW system in Pagudpod, Ilocos Norte in Luzon. This is a pilot project

of the National Power Corporation to electrify a number of households. It
was commissioned in 1996.
2. A 25-kW stand-alone system in Picnic Grove, Tagaytay, Batangas in
Luzon.
3. A 3-kW system in Bantay, Ilocos Sur in Luzon. In tandem with a diesel
generator, this system is used to power up a relay station of the Philippine
Telegraph and Telecommunications Company (PT & T). It is in operation
since 1994.
4. A 25-kW system in General Santos in Mindanao.
Two committed wind projects are expected to contribute a significant amount of

electricity to grid. These are the 40-MW North Luzon Wind Power Project (NLWPP)
of the Philippine National Oil Company-Energy Development Corporation (PNOC-
EDC) and the 25-MW wind project of Northwind, which are scheduled for
commissioning in 2006 and 2004, respectively. These wind facilities will both be
located in Ilocos Norte. Proponents of these projects were able to secure power
purchase agreements with the local distribution utility, which they used to obtain
financing. Further, project proponents were able to obtain very lenient and attractive
financing schemes. The PNOC-EDC project was given a soft loan amounting to $48
million dollars by the Japan Bank for International Cooperation (JBIC) at annual
interests below 1 percent (0.95 percent for goods, 0.75 percent for consulting
services) and a 40-year repayment period (inclusive of a 10-year grace period).
Project proponents claim that they will be able to sell electricity at prices below that
of the grid.
It is significant to note two issues that developers of these two wind power projects
had to address. First is the absence of site-specific wind assessment data, which
required the developers to collect at least two-years of wind speed measurements.
Second is the connection of the wind farms to the transmission grid. Transmission
facilities are quite far from the wind sites, that for the NLWPP, that the PNOC-EDC
was required to put up 42 kilometers of transmission line and 130 transmission line
towers/poles to connect to the nearest transmission line trunk.

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For the purposes of the present study, a re-analysis of the NREL data was
conducted by the UPSL using the following criteria to screen for viable wind power
sites:
1. Power density of at least 500 W/m2;

2. The transmission line components to connect the site to the existing grid
will not exceed 25% of the levelized cost of the combined generation and
transmission cost. To compute for transmission cost, the UPSL computed
for the linear distance between the wind site and the nearest existing
substation. This distance was multiplied by a factor of 1.5 to adjust for
topography and other factors that may affect the routing of the
transmission system.
The first criteria reduced the number of wind sites to 2,092, with an aggregate
potential of 14,363 MW. The application of the second criteria further reduced the
number of sites to 1,038 with 7,400 MW potential. Tables 2.3 and 2.4 summarize the
results of the re-analysis. Locations of these sites are shown in Figure 2.1. Appendix
A identifies the provinces where these wind resources are located, as well as its
corresponding estimated electric capacity and annual generation.
Table 2.3: Philippine Wind Electric Potential

(with wind power density ≥ 500 W/m2)
Luzon Visayas Mindanao Philippines

Number of sites 1,668 360 64 2,092
Total area, km 2 1,755 385 66 2,206
Potential installed capacity,
11,381 2,527 455 14,363
MWe
Estimated Annual
35,437 7,865 1,397 44,699
Generation, GWh/yr
Table 2.4: Practical Wind Resources in the Philippines

(with wind power density ≥ 500 W/m2 and transmission cost constraint)

Number of sites 686 305 47 1,038
Total area, km 2 753 330 49 1,132
4,900 2,168 336 7,404
MWe
Estimated Annual
15,277 6,738 1,032 23,047
Generation, GWh/yr

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Luzon
Number of sites: 686
Potential Installed
Capacity: 4,900 MWe
Estimated Annual
Generation: 15,277 GWh
Visayas
Potential Installed
Capacity: 2,168 MWe
Estimated Annual
Mindanao
Number of sites: 47
Potential Installed
Capacity: 336 MWe
Estimated Annual
Figure 2.1: Practical Wind Resources in the Philippines

(with wind power density ≥ 500 W/m2 and transmission cost constraint)

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Hydro Resources
Hydro power contributes a large amount of energy to grid-based electricity in the

country. By the end of 2001, a total of 2,518 MW of hydro power is installed in the
Philippines, with an annual production of 7,104 GWh. These hydro power facilities
range in size from 1 to 360 MW and includes reservoir type (dams) and run-of-river
systems15.
In addition to the existing hydro power generation facilities, a number of large hydro
sites in country to be used as candidate power plants for energy planning. Table 2.5
lists down identified sites for large hydro16.
The UPSL made a re-analysis of the small17 hydro resource assessment made by
the NREL, selecting sites with capacities of 5 MW or more. Using this criterion, the
UPSL identified 239 small hydro sites in the country with an aggregated capacity of
about 2,327 MW. An additional screening criterion was used, i.e., sites whose
transmission line components needed to connect to the existing grid must not
exceed twenty five percent of the levelized combined generation and transmission
investment costs. These resulted to the elimination of three sites from the small
hydro resource pool. Tables 2.6 and 2.7 shows the results of the application of the
criteria mentioned above, while Figure 2.2 shows the location of the sites selected.
The DOE has verified a number of these small hydro sites, as listed in Table 2.8.
15
Impoundment dams involve the impounding of a large volume of water in or upstream of power
plants by use of reservoirs or dams. This water may then be used to augment supply during low flow
periods and thus ensure a relatively constant supply of power. Run-of-river systems, on the other
hand, make use of the natural flow of a rivers as head.
16
Two of these sites, Kalayaan and San Roque, are committed projects.
17
As per WEC definition.
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Table 2.5: Available Large Hydro Resources
Estimated
Site Province
Capacity (MW)
LUZON
Abuan Isabela 60
Addalam Quirino 46
Agbulo Apayao 360
Aglubang Mindoro Oriental 13.6
Amburayan Benguet 93
Bakun A/B Benguet 45
Binongan Abra 175
Catuiran Mindoro Oriental 24
Diduyun Quirino 332
Kalayaan PS Laguna 350
Kanan Quezon 113
Lamut Ifugao 12
Matuno Ifugao 52 to 250
Nalatang Benguet 45
Pasil B/C Kalinga Apayao 42
Saltan A/B Kalinga 34
San Roque Pangasinan 345
Tanudan D Kalinga 27
Tinglayan B Kalinga 21
Total Luzon 2,189.6 to 2,387.6
VISAYAS
Pacuan Negros Oriental 33
Sicopong Negros Oriental 17.8
Timbaban Aklan 29
Villasiga Antique 29
Total Visayas 108.8
MINDANAO
Agus III Lanao del Norte 225
Bulanog-Batang Bukidnon 150
Lanon Hydro South Cotabato 21
Lake Mainit Agusan del Norte 22
Liangan Lanao del Norte 11.9
Pugo D/BA Agusan 44
Pulangi V North Cotabato 300
Tagoloan Bukidnon 68
Total Mindanao 841.9
TOTAL PHILIPPINES 3,140.3 to 3,338.3

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Table 2.6: Philippine Small Hydro Electric Potential

(sites with power capacity ≥ 5 MW)

Number of sites 134 9 96 239
1,291 58 978 2,327
MWe
Estimated Annual
6,786 305 5,140 12,231
Generation, GWh/yr
Table 2.7: Practical Small Hydro Resources in the Philippines

(sites with power capacity ≥ 5 MW and transmission cost constraint)

Number of sites 131 9 96 236
1,272 58 978 2,308
MWe
Estimated Annual
6,686 305 5,140 12,131
Generation, GWh/yr
Table 2.8: Small Hydro Power Sites Verified by the DOE
Site Province Estimated Capacity (MW)
LUZON
Colasi Camarines Norte 1.0
Total Luzon 1.0
VISAYAS
Amandaraga Eastern Samar 4.0
Bugtong Samar 1.0
Igbolo Iloilo City 4.0
Siaton Negros Oriental 5.4
Total Visayas 14.4
MINDANAO
Lower Dapitan Zamboanga del Norte 3.8
Taguibo Agusan del Norte 7.0
Middle Dapitan Zamboanga del Norte 4.4
Libungan North Cotabato 10.0
Upper Dapitan Zamboanga del Norte 3.6
Total Mindanao 28.8
TOTAL PHILIPPINES 44.2

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Luzon
Potential Installed
Capacity: 1,272 MWe
Estimated Annual
Visayas
Number of sites: 9
Potential Installed
Capacity: 2,308 MWe
Estimated Annual
Mindanao
Number of sites: 96
Potential Installed
Capacity: 978 MWe
Estimated Annual
Figure 2.2: Practical Small Hydro Resources in the Philippines

(sites with power capacity = 5 MW and transmission cost constraint)

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Biomass
In the past, biomass has contributed a significant amount to the national energy
consumption, amounting to as much as 30% of the total energy mix. However, the
contribution of biomass to grid-based electricity is yet to be seen.
Among identified biomass resources in the Philippines include forestry resources

and fuel wood, bagasse (residue resulting from the extraction of sugar cane juice),
rice hull, coconut residues, animal wastes and municipal solid wastes. Table 2.9
shows the projected supply of these biomass resources, as estimated by the
Philippines Department of Energy.
Table 2.9: Projected Supply of Biomass Resources

(petajoules)
Type 2005 2010 2015 2020 2025
Rice Residues 56.43 62.28 68.81 75.95 83.88
Coconut Residues 134.75 148.78 164.27 181.35 200.20
Bagasse 95.47 116.14 141.28 171.90 209.11
Fuelwood 608.54 693.63 796.05 919.21 1067.51
Animal Wastes 79.12 83.20 87.41 91.87 96.56
Municipal Wastes 736.40 833.14 934.77 1040.48 1149.12
TOTAL 1710.69 1937.19 2192.60 2480.76 2806.38

Source: Promotion of Renewable Energy Sources in South East Asia (PRESSEA) website
This high resource estimate for biomass resources has led to optimistic opinions
regarding grid-connected electricity generation systems using biomass. A joint report
by the United Nations Development Programme (UNDP) and the World Bank
estimates power from biomass that can be exported to the grid, as follows: 60 to 90
MW from bagasse, 40 MW from rice hull and 20 MW from coconut residues.
Although the paper and sugar industries already are using their biomass residues to
generate heat and power for their own use, grid-connected systems have yet to
materialize.
Two promising power generation projects using biomass as fuel are in the
development stage, both of which will be located in the province of Negros
Occidental in Region VI (Western Visayas Region) 18. These are the Victorias
Bioenergy and the Talisay Bioenergy projects, both of which are joint undertakings of
Bronzeoak Ltd of the United Kingdom and Venture Factors of the Philippines.
18
In 1999, Region VI accounted for almost 2 million tones of the total 3.6 million tones, roughly 54%,
of bagasse produced from sugar mills all over the country.
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The first project will involve the construction of a biomass-fired cogeneration plant
inside the Victorias Milling Company (VMC) complex19. The plant, which will consist
of two 161.5-tonne/hr boilers and a 50-MW steam turbine generator, will supply all
the steam and power requirements of the VMC refinery facilities20, and sell excess
power to the local electric cooperative Central Negros Electric Cooperative
(CENECO).21 Fuel would consist of bagasse and cane trash from VMC, bagasse
from other mills, and if needed, wood chips from local sustainable plantations 22. It is
estimated that the plant would consume 741,000 tonnes of bagasse annually. It is
also estimated that the project could sell about 1.6 million certificate of emissions
reduction (CER) credits over a 10-year period. The project would cost about US$
100 million23. The plant is expected to sell electricity at a price below that of the grid.
Commercial operation of the plant is scheduled on October 2005.
The second project, Talisay Bioenergy, is similar to VBI but smaller in scale. It will
involve the construction of a cogeneration plant in the facility of First Farmers
Holdings Corporation24 (FFHC). The plant, which will consist of two 85-tonne/hr
boilers and a 30-MW steam turbine generator, will supply all of FFHC’s steam and
electricity requirements in exchange for the mill’s bagasse production. The plant will
also provide any additional steam and electricity requirements of the FFHC at
commercial rates. Electricity that will be produced by the plant in excess of FFHC’s
requirements will be supplied to the local transmission grid. Commercial operation of
the plant is scheduled on August 2006. The project will cost approximately US $ 60
million.
Projects like the Victorias and Talisay Bioenergy projects provide economically
attractive options to sugar mills for the provision of its energy requirements and
dealing with its waste products. As a matter of fact, two similar projects are also
being explored for possible development, also in Region VI.
Table 2.10 shows UPSL’s estimates of the electric potential of bagasse in the
Philippines on a per region basis. These estimates take into account that bagasse-
fired systems are normally cogeneration systems25.
19
Victorias Milling Corporation has the largest milling facilities in the country, with a milling capacity of
15,000 tonnes of cane per day.
20
VBI and VMC had an initial understanding to have a 30-year energy supply agreement. Additional
steam and electricity requirements of VMC will be provided by VBI at commercial rates.
21
Part of the power that will be generated by VBI will go to CENECO: 26 MW during the on-season
and 43.6 MW during the off-season. A 30-year “take-or-pay” Power Supply Agreement has already
been executed between CENECO and VBI.
22
Bagasse and cane trash from VMC will be provided to VBI free of charge. Bagasse will also be
acquired from other plantations to supplement fuel supply. In case the amount of available bagasse
and cane transh could not meet plant demands, wood chips will be acquired from industrial tree
plantations. Bronzeoak and Venture Factors plan to put up Biofuel Resources, Inc. that would
establish industrial tree plantations using short term tree crops.
23
Aside from plant facilities, this cost includes the construction of a 138-kV switching station and a tie-
line connector approximately 3 km long.
24
FFHC has a milling capacity of 4,800 tonnes of cane per day.
25
Cogeneration systems produce electricity and heat (steam) simultaneously. Fuel consumption for
cogeneration systems using bagasse as fuel is around 3kg of bagasse for every kWh of electricity
produced. This value already takes steam production into account.
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Because of problems with such issues like collection, storage and competing uses,
which are like associated with the use of biomass fuels for large scale power
generation, this study only looks on the potential of bagasse for grid-connected
electricity generation. Unlike other biomass fuels, bagasse has traditionally been
used in large quantities, particularly to fuel boilers in sugar mills. Despite sugar mills’
own use of bagasse for fuel, there usually remains a considerable amount of this
waste material, which the mills have to dispose.
Table 2.10: Philippine Bagasse Electric Potential
Potential Installed Capacity

Region Name
(MW)
1 Ilocos Region 0.2

2 Cagayan Region 3.1
3 Central Luzon 14.0
4 Southern Tagalog 22.0
5 Bicol Region 4.6
6 Western Visayas Region 127.8
7 Central Visayas Region 32.7
8 Eastern Visayas Region 7.6
10 Northern Mindanao 17.9
11 Southern Mindanao 5.8
TOTAL PHILIPPINES 235.7
Geothermal Power
The Philippines power sector largely depends on geothermal energy to meet the
demand and energy requirements of the country. In 2001, total geothermal installed
capacity amounted to 1,931 MW and geothermal generation was 10,442 GWh,
accounting for 14% and 22% of the total installed capacity and total generation,
respectively.
In addition to existing geothermal power facilities, an estimated capacity of 1,200

MW and energy of 8,935 GWh can be obtained from the verified geothermal source
candidates in the Philippines, as listed in Table 2.11. Of the total estimated capacity,
380 MW, 700 MW, and 120 MW come from Luzon, Visayas and Mindanao
respectively. Very small, if any, additional geothermal resources could be expected
in the future as the Philippines has nearly used most of its geothermal resource
sites.

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Table 2.11: Available Geothermal Resources for Power Generation
Name Location Potential Installed Capacity
LUZON
Bacman I Sorsogon 10
Rangas Tanawon Sorsogon 40
Manito Albay 20
Montelago Oriental Mindoro 20
Daklan Benguet 10
Mt. Natib Bataan 20
Mabini Batangas 20
Batong Buhay Kalinga 120
Buguias-Tinoc Benguet 120
Total Luzon 380
VISAYAS
Northern Negros* Negros Occidental 40
Dauin Negros Oriental 20
Mt. Cabalian Leyte 60
Leyte Optimization Leyte 40
Biliran Biliran 40
Mt. Lobi Central Leyte 200
Mahagnao Central Leyte 300
Total Visayas 700
MINDANAO
Lakewood Zamboanga del Sur 80
Manat-Amacan Davao del Norte 40
Total Mindanao 120
PHILIPPINES TOTAL 1,200
*committed plant
Source: DOE
Natural Gas
A few natural gas finds in the Philippines have been made, the most significant of
which is that found in Malampaya and San Martin in Palawan26, with a combined
estimated reserves of 2,771 to 4,731 billion cubic feet (BCF). Table 2.12 lists down
identified natural gas fields in the country and their corresponding resource sizes.
The Philippine government is considering plans to develop a local natural gas

industry, which will involve the laying down of a natural gas pipeline network in
Luzon and the construction of liquefied natural gas (LNG) facilities at different points
in the country. If this pushes through, local natural gas production would be
supplemented by imported natural gas that would come from the Trans ASEAN Gas
Pipeline to meet demand.
26
These are proven fields. Source: PEP 2002-2011.
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Table 2.12: Philippine Natural Gas Resources
Resource Size (BCF)

Gas Field
Minimum Prospective Maximum
PROVEN
Camago-Malampaya 2,538 3,340 4,277
San Martin 243 359 454
San Antonio 4
POTENTIAL
Mindoro-Cuyo 2,720 7,060 11,210
Cotabato 60 1,158 1,760
Cagayan 176 322 518
Central Luzon 78 637 2,594
Source: Philippine Natural Gas Plan
2.3 Cost Comparison of Power Generation Technologies
The investment, O & M27 and fuel costs28 comparison of the different types of power
plants are shown in Table 2.13. In general, renewable energy-based plants have
high investment costs. Wind and hydro plants do not require fuel but do not run at full
capacity due to availability of resources. In addition, the total investment costs vary
with site preparation and the required transmission lines to enable the plants to
deliver power to the grid. The costs shown in Table 2.13 include only the costs of the
technologies but not the associated site-specific costs that could be more expensive
than the plant itself. Being site-specific, renewable energy-based power plants have
to address these issues that will ultimately determine the viability of the power
projects.
For fossil-fuel-based power plants, it is notable that the technologies that require low
investment normally require fuel with high cost. For example, coal plants could cost
twice as much as diesel plants but the fuel cost for diesel plants could be 2 to 4
times the cost of coal per kWh of electricity generated. The fuel costs in Table 2.13
lists for different fuels used for power generation are based on typical power plant
efficiencies.
Renewable energy technologies, in general entail high investment costs. The high
front-end cost associated with renewable energy technologies is often cited as one
of the reasons for the high perceived risk for these technologies.
Clearly, the economics of power generation technologies depends on several

factors, namely: (a) investment cost, (b) operation and maintenance (O&M) cost, (c)
fuel cost, and (d) the level of generation (also called capacity factor29). Screening
curves can be developed to determine the optimum power generation plan
considering these four factors. Using these curves, the type of power plants that will
27
Figures used for power plant investment and O&M cost are only intended for relative comparison.
28
The fuel costs used in this study do no include import duties. Furthermore, the prices of fuel are
likely to differ at the time this study is released.
29
Capacity Factor (CF) refers to the percentage of the rated capacity of the power plant used for
8,760 hours (i.e., one year). Mathematically,
energy production (kWh)
CF = × 100
plant capacity(k W) × 8,760 hours

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operate as “baseload”, “intermediate” or “peaking” plants (i.e., which will operate at

high, medium or low capacity factor) could be determined/selected.
Table 2.13: Cost Comparison of Power Plants
Typical Annual Fixed

Investment Fuel Cost,
Type of Power Plant Economic O & M Cost,
Cost, $/kWa $/MWh
Life, years $/kWa
Oil-fired steam turbine 30 850 – 1,000 17 – 20 41.04
Oil-fired gas turbine 20 450 - 550 11 – 14 49.93
Oil-fired combined cycle
20 700 – 900 14 – 18 32.56
gas turbine
Diesel motors 20 550 – 650 14 – 16 73.10
Pulverized coal-fired
30 1,200 – 1,400 30 – 35 11.40
power plant
Fluidized bed coal power
30 1,750 – 1,800 44 – 45 9.12
plant
Wind technologies 20 1,000 – 1,250 20 – 25 0
Hydroelectric power
50 2,000 – 3,500 40 – 70 0
plants
Fluidized bed combustors
30 1,750 – 1,800 44 – 45 3.53
(for biomass)
Geothermal technologies 50 1,150 – 1,500 29 – 38 0
Gas-fired combined cycle
gas turbine (for natural 20 700 – 900 14 – 18 36.68
gas)
a
From “ The Environmental Manual for Power Development”, Deutsche Gessellschaft für technishe, except for Clean Coal
Technologies
Considering the availability of the resource and reliability of the technologies, Table
2.14 shows the typical capacity factors based on the investment30, O&M and fuel
costs31 of the different power plant technologies. These figures are intended only for
relative comparison of the different power plant technologies. These values were
used by the UPSL in the cost assessment of the power development plan prepared
by DOE and in preparing an alternative plan for simulating the fuel-switching
scenario for the Philippine power sector discussed in the following chapters.
Table 2.14 also shows the corresponding levelized cost of generation for each power
plant type using the typical capacity factors. These values show that electricity
generation from renewable sources, on a life-cycle basis, is competitive in
comparison with conventional fossil fuel-based generation.
It should be emphasized that the actual capacity factors that may be achieved in
operation may not fall on the values given in Table 2.14 to satisfy the minimum off-
take character of the IPP contracts. They are however useful in evaluating and
developing energy plans.
30
Investment costs used in this study do not include site preparation, transmission line and
transformer costs.
31
Fuel costs for oil, coal and natural gas do not include import duties. Geothermal steam and biomass
fuel costs also vary, depending on the site/environment. Furthermore, the prices of fuel are likely to
differ by the time this study is released.
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Table 2.14: Typical Capacity Factors of Power Plants and Levelized Generation
Costs32
Capacity Factor Levelized Generation Cost

Power Plant Type
(%) $/kWh PhP/kWh
Geothermal 88 0.0193 1.0602

Hydro 57 0.0494 2.7153
Oil-fired steam turbine 54 0.1059 5.8236
Natural gas combined cycle 54 0.0794 4.3644
Oil-fired gas turbine 31 0.1101 6.0557
Wind
Without ancillary services 30 0.0512 2.8174
With ancillary services 30 0.0625 3.4376
Diesel33 9 0.2277 12.5219
32
A discount rate of 12% was used to derive levelized generation costs. Actual industry discount rates
may be higher depending on the following factors: required equity return, market risks, regulatory
risks, country risks and availability of financing.
33
The low capacity factor computed for diesel plant is 9%, meaning it will be used for load following
and/or peaking applications.
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2.4 Environmental Externalities
In the previous section, costs associated directly with the production of electricity
from various technologies and resources were discussed. These costs are what
normally dictate an energy planner’s choice of which power generation technology to
use. Power generation technologies, however, are directly associated with effects
that affect people’s welfare. These effects are called externalities. By definition, an
externality is “an unpriced benefit or cost directly bestowed or imposed upon one
agent by the actions of another agent”34. In the case of electricity generation,
externalities include various pollutants that cause damage to receptors such as
human health, natural ecosystems, crops and property. According to Koomey and
Krause (1997), “Pollution represents an external cost because damages associated
with it are borne by society as a whole and are not reflected in market transactions.”
A number of studies have attempted to put a cost on the various externalities caused
by power generation using the abatement cost or the damage cost approach. The
abatement cost approach uses the cost of pollution control as a proxy to the true
externality cost35. On the other hand, the damage cost approach puts a value on the
damages that may be directly attributable to a particular pollutant. Studies vary in
their estimation of externality costs because of a number of factors, including site
specificity (e.g., geographical and climatological conditions), population density,
emissions reduction policy, scope of analysis, among others. Table 2.15 shows the
value of various air emissions in California, currently a leader in externality policy, as
determined by the California Energy Commission using both the abatement and
damage cost approaches. From the values given, a number of things could be noted.
First, there is a pronounced difference between damage cost and pollutant cost
values. Except for particulate matter, abatement costs are normally higher that
damage cost estimates. Second, externality costs differ among different districts. In
this study, abatement cost values for the North Coast of California, which has the
lowest abatement costs among the districts, were used to compute for the cost of
externalities of the different scenarios.
Table 2.16 shows the factors used in this study to arrive at the CO2 emissions of
each type of power plant in tonne CO2/GWh. The values were calculated based on
the generic data recommended for power development analysis. It should be noted
that even though coal seem to have a lower CO2 emission level than conventional
power plant types, its contribution to total greenhouse emissions is more substantial
since coal plants are normally used for base load generation while oil based plants
are mostly used for load following and peaking applications. Other air pollutant
emissions for different power plants are listed in Table 2.17.
34
T. Sundqvist and P. Söderholm, “Pricing Power Generation Externalities: Ethical Limits and
Implications for Social Choice” (one of the six self-contained papers included in Sundqvist’s Doctoral
Thesis, “Power Generation Choice in the Presence of Environmental Externalities, Luleá University of
Technology, 2002), p. 3.
35
Jonathan Koomey and Florentin Krause, “Introduction to Environmental Externality Costs”, as
published in the CRC Handbook on Energy Efficiency (1997).
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Table 2.15: Value of Air Emissions Reductions in California 36

($/pound of pollutant)
District
Pollutant Ventura San Joaquin Sacramento

South Coast Bay Area San Diego North Coast
County Valley Valley
DC AC DC AC DC AC DC AC DC AC DC AC DC AC
SOx 4.88 13.02 0.99 4.08 2.28 5.85 1.76 2.37 0.99 11.71 0.99 5.39 0.99 1.98
NOx 9.52 17.4 1.08 10.85 4.83 6.84 3.66 12.03 4.26 5.98 4.01 6.01 0.53 3.96
CO 0.00 6.12 0.00 I 0.00 1.45 0.00 0.72 0.00 2.10 0.00 3.30 0.00 I
ROG 4.55 12.43 0.18 13.88 0.07 6.71 0.07 11.51 2.45 5.98 2.72 6.01 0.31 2.31
PM 31.32 3.75 16.05 1.18 15.78 1.71 9.35 0.66 2.47 3.42 1.44 1.85 0.37 0.59
DC – damage cost; AC – abatement cost; I – internalized; SOx – Sulfur Oxide; NOx – Nitrogen Oxide; CO – Carbon Monoxide;
ROG – Reactive organic gases; and PM – particulate matter
Table 2.16: Carbon Dioxide Emissions of Different Power Plant Types
Power Plant Type tonne CO2/GWh

Geothermal 45.40
Pulverized Coal 726.99
Oil Combined Cycle 565.83
Natural Gas Combined Cycle 441.82
Oil Steam Turbine 713.10
Oil Gas Turbine 867.61
Diesel 763.04
Source: Computed from data give in “The GHG Indicator: UNEP Guidelines for
Calculating Greenhouse Gas Emissions for Business and Non-Commercial
Organizations, except for geothermal which was computed from DOE data
Table 2.17: Emissions Factors for Various Power Plants

(tonne/GWh)
Environmental Emissions
Plant Type
SO2 NOx CO CH4 NMVOC N2O Particulates
Coal 7.40 4.20 0.88 0.53 0.02 0.02 0.03
Oil combined cycle 7.65 2.02 0.34 1.01 0.03 0.06 0.02
Natural gas 0.01 1.64 0.06 0.66 0.04 0.08 0.02
combined cycle
Oil steam turbine 9.75 2.00 0.72 0.57 0.03 0.03 0.03
Oil gas turbine 11.74 3.10 0.52 1.55 0.05 0.10 0.04
Diesel 2.03 8.73 1.75 0.87 0.05 0.05 0.02
Source: The Environmental Manual for Power Development, Deutsche Gessellschaft für technishe
36
Lifted from “What Causes the Disparity of Electricity Externality Estimates?”, one of the six self-
contained papers included in Sundqvist’s Doctoral Thesis, “Power Generation Choice in the Presence
of Environmental Externalities, Luleá University of Technology, 2002), p. 10. Sundqvist cites the 1992
Electricity Report by the California Energy Commission as the source of these data.
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2.5 Mitigation Options
As a result of the technology and resource analyses made by the UPSL, the
following clean energy options were used for the generation of alternative planning
options discussed in Chapter 4 of this report:
• Wind power
• Hydro
• Biomass (bagasse)
• Geothermal power
• Natural gas
For biomass, only bagasse was considered as option. The UPSL did not consider
other forms (rice hull, wood wastes, coconut residues) in the generation of
alternative options for grid-connected electricity generation as they are still
associated with problems such as that of sourcing, collection, storage and competing
uses.
On the use of natural gas, it was assumed that infrastructure would be built to
support an expanding natural gas industry.

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3 HISTORICAL PERFORMANCE OF THE PHILIPPINE POWER SECTOR
In the following sections is an assessment of the performance of the Philippine

power sector from the period beginning 1991 to 2001. Performance is assessed in
terms of reliability, environmental emissions, and cost. Data for the historical
performance of the Philippine Power Sector is given in Appendix B.
3.1 Historical Energy Demand and Installed Generating Capacity
The Philippines electricity consumption posted a moderate growth rate of 8.3%

annually from 1991 to 2001 as shown in Table 3.1. The industrial and residential
sectors, with 31% and 29% share respectively, are the biggest users of electricity
(Figure 3.1). It should be noted however, that the industrial sector demand grew only
by 5.5% while that of the residential sector grew by 11.7% annually for the 11-year
period. Significant also was the growth in the consumption of the commercial sector,
whose demand grew by 108% from 1991 to 2001, or at an average annual growth
rate of 7.6%. Both the economic performance and population growth remain as the
main factors driving the consumption pattern of energy of the country. As shown in
Figure 3.2, the gross domestic product and the population growth from 1991 to 2001
demonstrate a strong correlation with the consumption of electricity.
Table 3.1: Energy Consumption by Sector, 1991-2001

(GWh)
SECTOR 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Residential 6,249 6,053 6,368 7,282 8,223 9,150 10,477 11,936 11,875 12,894 13,547
Commercial 4,847 4,910 4,725 5,865 6,353 7,072 8,013 8,725 8,901 9,512 10,098
Industrial 9,339 8,859 9,395 10,684 10,950 11,851 12,531 12,543 12,444 13,191 14,452
Others 952 823 721 762 1,067 1,167 1,267 934 921 957 1,042
Own Use 1,086 1,154 1,132 1,132 1,226 1,340 1,471 1,590 1,536 2,390 2,196
Losses 3,176 4,071 4,238 4,734 5,735 6,128 6,037 5,849 5,754 6,345 5,713
Total 25,649 25,870 26,579 30,459 33,554 36,708 39,797 41,578 41,432 45,290 47,049
Geographically, the energy demand in the country was distributed among the three
(3) main islands of Luzon, Visayas and Mindanao as shown in Figure 3.3. Bulk of the
energy demand and consequently the generation comes from the main island of
Luzon. In 2001 for example, the Luzon Grid consumed 36,184 GWh of the total
47,049 GWh energy generation which represents 77% of the requirements of the
country. Visayas and Mindanao share the balance energy almost equally.
Figure 3.4 shows system peak demand of the power supply system from 1991 to
2001 for the Luzon, Visayas and Mindanao grids, and the whole of the Philippines.
The system peak for the whole Philippines reached 7,682 MW in 2001. This is
almost twice of the 4,081 MW peak demand in 1991. With most of the industrial and
commercial activities centered in Luzon, it also had the highest peak demand (5,835
MW in 2001). Visayas and Mindanao lag far behind with only 893 and 954 MW peak
demand, respectively.
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Power Losses
12%
Utilities Own Use Residential

5% 29%
Others
2%
Industrial
31%
Commercial
21%
Figure 3.1: Electricity Consumption by Sector, 2001
120000 90000
80000
100000
70000
80000 60000
GWH / POP
GDP (x1000)
(x10M) 50000
60000
40000
40000 30000
20000
20000
10000
0 0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
year
Electricity (GWH) GDP (BPhP) Population (in million)
Figure 3.2: Electricity Consumption, Gross Domestic Product

and Population, 1991-2001
In order to meet the growing demand for electricity, the installed generating capacity
in the country doubled from 6,789 MW in 1991 to 13,402 MW in 2001 (Figure 3.5)
This corresponds to the growth in demand that also doubled in the same period.

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50,000
45,000
40,000
35,000
30,000
GWH
25,000
20,000
15,000
10,000
5,000
0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Figure 3.3: Electricity Generation by Grid, 1991-2001

(GWh)
9000
8000
7000
6000
5000
MW
4000
3000
2000
1000
0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Figure 3.4: System Peak by Grid, 1991-2001

(MW)

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16,000
14,000
12,000
10,000
MW
8,000
6,000
4,000
2,000
0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Oil-Based Coal Natural Gas Geothermal Hydro
Figure 3.5: Total Installed Generating Capacity by Source, 1991-2001

(MW)
3.2 Historical Reliability Performance
The historical data for the system peak demand and installed generating capacity
indicate that the generating facilities in the early 1990’s were performing very badly
from the point of view of reliability. It may be recalled that the Philippines
experienced a power crisis that started in the late 1980’s and persisted in the mid
1990’s that almost crippled the national economy due to supply deficiency. There
was not enough generating capacity. Hence, the National Power Corporation has to
resort to rotating “brownouts”. Today, people complain of high cost of electricity
allegedly due to over supply as there is “too much” installed generating capacity.
To analyze further the generating capacity vis-à-vis the system peak, Table 3.2
presents the reserve margin of the power system from 1991 to 2001. In other
countries such as the U.S.A., the generating capacity reliability criteria of one day
per ten years (1 day/10 year) of Loss-of-Load Probability (LOLP) translates to about
20% reserve margin. This criterion is considered high but is needed to support their
industries. In developing countries, the reliability criterion is very much lower
compared to that in developed countries. In the Philippines, the National Power
Corporation since the power crisis has adopted 1day/year LOLP. The reserve margin
based on dependable capacity shows that there is indeed a large excess generating
capacity in the Philippines. This validates the clamor of the people regarding high
electricity rates which is due to oversupply since most of the generating facilities are
operating under the take-or-pay contract with NPC and other distribution utilities.

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It can be concluded, therefore, that the generating capacity of the power system in
the Philippines can be considered highly reliable. The interruptions that the country
has been experiencing can be attributed to the unreliable transmission and
distribution systems.
Table 3.2: Reserve Margin, 1991-2001

(%)
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Peak (MW) 4,081 4,296 4,687 4,808 5,291 5,816 6,352 6,666 6,908 7,400 7,682
Installed
Capacity 6,789 6,949 8,014 9,212 9,732 11,193 11,762 11,931 12,431 13,185 13,402
(MW)
Percentage
Reserve
66.36 61.76 70.98 91.60 83.93 92.45 85.17 78.99 79.96 78.18 74.46
Margin
(installed)
Dependable
Capacity 8,621 7,450 9,497 11,363 11,209
(MW)
Percentage
Reserve
35.72 11.76 37.48 53.55 45.91
Margin
(dependable)
3.3 Historical Environmental Performance
Another way of evaluating the performance of the power sector is in terms of the
gases and particulates that are emitted in the air by the generating plants. This part
of the study has quantified the environmental emissions of the power plants in the
country.
The environmental performance of the Philippine power sector from 1991 to 2001 is
summarized in Table 3.3. A complete list of emissions for each year from 1991 to
2001 is provided in Appendix B. The CO2 emissions increased by 74 percent while
the rest of the air emissions increased by 10 to 169 percent.
Table 3.3. Historical Environmental Emissions for the Philippine Power Sector
(tonne)
Environmental
1991 Level 2001 Level % Increase
Emissions
CO2 10,580,233 18,411,762 74
SO2 115,725 189,729 64
NOx 58,726 146,807 150
CO 16,124 20,796 29
CH4 587 904 54
NMVOC 975 1,075 10
N2O 415 842 103
Particulates 10,989 29,611 169

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For the CO2 emissions, Figure 3.6 shows that the coal power plants are the major
contributors in greenhouse gases. Its contribution increased almost ten times from
1,082,279 tons in 1991 to 10,471,222 tons in 2001. The CO2 emissions however
from oil-based power plants decreased by 21 percent from its level of 9,236,541 tons
in 1991 to 7,338,665 tons in 2001. The net increase in CO2 due to the changes in oil
and coal is 74%.
In order to analyze the factors that brought about the environmental performance of
the power sector, it is necessary to look at the power development as measured by
the energy mix. The energy mix indicates the intensity of contribution of renewable
energy resources as fuel for power generation. Figures 3.7 and 3.8 show that non-
renewable energy have remained greatly dominant over renewable energy as source
of fuel for power generation. Figure 3.9 shows how carbon dioxide emissions varied
with the energy mix within the 1991 to 2001 period. Note from this figure how much
the CO2 emissions decreased and increased with the generation from oil-based and
coal power plants.
20,000,000
18,000,000
16,000,000
14,000,000
12,000,000
tonne CO2
10,000,000
8,000,000
6,000,000
4,000,000
2,000,000
0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Year
Oil-based Coal Natural Gas Geothermal
Figure 3.6: Carbon Dioxide Emissions by Fuel Type, 1991-2001

(tonne)
The share of non-renewable sources in the energy mix even increased from 57.49%
in 1991 to 62.71% in 2001. The share of renewable sources, on the other hand,
decreased from 42.51% to 37.29% during the same period. Over the period
considered, the percentage share of oil-based power generation declined by 58%.
However, the share of coal-based generation increased by 427%. This scenario
allowed the continued dominance of non-renewable fuels.

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In addition, renewable hydro and geothermal sources share decreased by 25% and
1%, respectively over the same period.
Clearly, the shift is only towards use of coal, which is a cheaper fuel, and not towards
use of renewable resources. This explains why the emissions of the power sector
almost doubled in only 11 years.
One thing to note, however, is the emerging use of natural gas, which despite being
non-renewable is considered cleaner fuel for power generation. With 1,063 MW of
natural gas plant already installed in 2001 and another 1,700 MW installed by 2002,
more energy generated from this source can be expected in the coming years.
(Chapters 4 and 5 discuss the scenarios under the DOE Philippine Energy Plan and
UPSL alternative scenarios, respectively, for 2003 to 2012).
Combining the generation from natural gas in the year 2001 with that of the
renewable sources, the percent share of cleaner fuels increased a bit from 37%
(renewable only) to 39% (renewable plus natural gas). This leaves the percent share
of non-renewable (coal and oil) to 61%.
100%
80%
60%
40%
20%
0%
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Oil-Based Coal Natural Gas Geothermal Hydro
Figure 3.7: Energy Mix, 1991-2001

(%)

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100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Coal and Oil-Based Renewable and Natural Gas
Figure 3.8: Share of Coal and Oil-Based vs. Renewable Energy and Natural Gas
in the Energy Mix, 1999-2001
(%)
50,000 20,000,000
45,000 18,000,000
40,000 16,000,000
35,000 14,000,000
30,000 12,000,000
tonne CO2
GWh
25,000 10,000,000
20,000 8,000,000
15,000 6,000,000
10,000 4,000,000
5,000 2,000,000
0 0
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Year
Oil-based Coal Natural Gas Geothermal Hydro CO2
Figure 3.9: Energy Mix and Carbon Dioxide Emissions, 1991-2001

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3.4 Cost of Electricity
This study also assessed the power development in the Philippines by analyzing the
cost of electricity. It was noted that the average rates of NPC is for its bundled
generation and transmission services. In addition, the average rates consist of the
actual operating expenses and the financing charges of NPC.
For purposes of this study, the rates of NPC were unbundled into 76% and 24% for
generation and transmission, respectively. The average rates and the estimated
unbundled generation and transmission rates of NPC from 1995 to 2001 are shown
in Table 3.4.
Table 3.4: NPC Average Electricity Rates, 1991-2001

(PhP/kWh)
Year
1995 1996 1997 1998 1999 2000 2001
Luzon 1.85 2.08 2.29 2.77 2.84 3.34 3.01
Visayas 1.93 2.02 2.15 2.44 2.52 3.23 3.08
Mindanao 1.28 1.25 1.25 1.68 1.67 1.92 2.02
Philippines 1.77 1.96 2.14 2.58 2.65 3.12 2.90
Generation 1.35 1.49 1.63 1.96 2.02 2.37 2.20
Transmission 0.43 0.47 0.52 0.62 0.64 0.75 0.70
Note: Generation and Transmission Rates assumed 76% and 24% of the average rate, respectively
The average rates of NPC increased annually from 1991 to 2001, except for the year
2001 when R.A. 9136 (Electric Power Industry Reform Act) was enacted.
Interestingly, the law has mandates to reduce the rates of electricity in the
Philippines. The increase in rates is attributed to the economic performance of the
country as measured the exchange rates and allegedly due to the take-or-pay
contracts of NPC with Independent Power Producers (IPPs). Comparing the average
rate of NPC with that paid by the consumers, which range from PhP 4.00 to PhP
6.00 per kWh, there is difference of PhP 1.00 to PhP 3.00 per kWh. This
considerable difference can be attributed to the cost of distribution and to the IPP’s
that sell electricity directly to the distributors. Table 2.5 show the production cost of
NPC and IPPs, respectively, for the years 1995 to 2001 by fuel type. IPP costs were
always higher than NPC rates.
It is worthwhile to note that with the existence of the Non-NPC IPP’s (permitted to
operate through Executive Order 215), particularly that of the electricity distributors
like MERALCO, many power plants were installed without the benefit of proper
coordination through the centralized planning of the NPC or the government. As a
result, many power plants were installed in excess of what was actually needed, and
the cost of which has to be paid off through the Purchased Power Adjustment (PPA).

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Table 3.5: NPC and IPP Production Cost at 1990 Constant Prices (US$/kWh)*
Oil-based Hydro Geothermal Coal

Year
NPC IPP NPC IPP NPC IPP NPC IPP
1995 0.0254 0.0386 0.0125 0.0360 0.0294 --- 0.0284 ---
1996 0.0281 0.0428 0.0109 0.0326 0.0252 0.0366 0.0303 0.0431
1997 0.0276 0.0450 0.0111 0.0284 0.0230 0.0349 0.0244 0.0358
1998 0.0212 0.0369 0.0092 0.0276 0.0198 0.0331 0.0150 0.0265
1999 0.0267 0.0538 0.0067 0.0270 0.0195 0.0329 0.0137 0.0236
2000 0.0394 0.0662 0.0047 0.0367 0.0167 0.0281 0.0110 0.0232
2001 0.0302 0.0462 0.0038 0.0683 0.0177 0.0233 0.0100 0.0203
* Lifted from “Renewable Energy Prospects for Supplying Electricity in the Deregulated Market in the Philippines” by J. N.
Estiva and M. G. Guzman

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4 SCENARIOS UNDER THE PHILIPPINE ENERGY PLAN FOR 2003 TO 2012
This section discusses the current national energy planning process and DOE’s
energy generation plans for 2003 to 2012. 37
4.1 National Energy Planning Process
In coming up with an energy plan, the national government through the DOE
employs a top-down approach, in which all the main inputs and arguments to the
plan are based on the national macroeconomic and the energy sector goals.
Hinging electricity demand on the country’s economic activity, the DOE projects the
national and regional energy and power requirements based on the forecast of the
National Economic Development Authority’s (NEDA) Gross Domestic Product (GDP)
and Gross Regional Domestic Product (GRDP). These projections are then used by
the National Transmission Corporation (TRANSCO) to plan the transmission
requirements of the country.
Distribution utilities (DU’s), such as MERALCO and the electric cooperatives (EC’s),
on the other hand, make their own demand and expansion plans based land-use,
historical sales, and projected increase in customers.
As illustrated in Figure 4.1, the plans formulated by the DOE, TRANSO, DU’s and
EC’s, serve as primary inputs to the Power Development Plan (PDP), which in turn,
is a critical part of the Philippine Energy Plan. In the PDP, where the power plant
type and capacity additions and retirement are indicated, the “least cost” criterion is
the primary factor in determining the power plant projects and line-up for the
planning period.
Interestingly, as shown in the above figure, renewable energy and other energy
resources project planning do not directly form part of the PDP. Small renewable
energy projects, in particular, are considered through the electrification program only.
Note that the program pertains to the rural electrification program, which aims to
bring electricity to the un-electrified areas.
With the existing approach, it is only until the DOE puts in specific goals for the
renewable energy sector can it be factored in to the PDP. Relating this type of
approach to the historical performance (as discussed in the previous section) of the
renewable energy, it is evident that the non-integration of the renewable energy
resources projects in the PDP could limit the development of renewable energy as
an important alternative power resource.
The current top-down approach, while it is very effective in supporting the national
goals, allows limited public and local government participation that espouses their
interests, particularly in local environmental protection and power development.
37
For the scenarios in this chapter as well as in Chapter 5, power plant costs (investment, O&M and
fuel) indicated in Tables 2.13 and 2.14 in Chapter 2 were used. Costs computed are for comparative
purposes only and may not be equal to the actual costs. A discount rate of 12 percent was used.
Actual industry discount rates may be higher depending on the following: required equity return,
market risks, regulatory risks, country risks and availability of financing
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Generation Transmission Distribution Small

Renewable
Planning Planning Planning Energy
(DOE) (TRANSCO) (PUs & Ecs)
Projects
Electrification
Power Development Program Program
Other Energy
Sectors Planning Philippine Energy Plan
NRE, Oil, Coal, etc.
Top-Down Approach
Figure 4.1: National Energy Planning Process
4.2 Gross Domestic Product Projections
In the Philippine Energy Plan for the period 2003-2012, the DOE uses two economic
scenarios from which to forecast future energy requirement of the country. These
two scenarios are based on the NEDA’s low and high projections of the country’s
GDP and are aptly named the Low GDP and High GDP scenarios. In this report, the
low GDP scenario will be referred to as the Low Economic Growth Scenario (LEGS)
and the high GDP scenario as the High Economic Growth Scenario (HEGS). The
GDP projections for the two scenarios, as well as the its corresponding growth rates
are shown in Table 4.1.
Table 4.1: Low and High GDP Forecasts for 2003 to 2012
Low GDP High GDP

Year GDP Growth Rate GDP Growth Rate
(billion PhP) (%) (billion PhP) (%)
2003 1,079.95 4.96 1,091.11 5.51
2004 1,138.70 5.44 1,156.69 6.01
2005 1,203.62 5.70 1,229.48 6.29
2006 1,276.27 6.04 1,311.09 6.64
2007 1,343.01 5.23 1,387.10 5.80
2008 1,413.24 5.23 1,467.51 5.80
2009 1,487.14 5.23 1,552.59 5.80
2010 1,564.91 5.23 1,642.60 5.80
2011 1,646.74 5.23 1,737.82 5.80
2010 1,732.85 5.23 1,838.57 5.80
Note: GDP values for 2003 to 2006 are actual NEDA forecasts. For 2007 to 2012, the DOE estimated
GDP values based on the average growth rates forecasted by NEDA.
Source: Philippine Energy Plan 2003-2012

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In the PEP, the DOE formulates generation plans for the two economic scenarios.
These plans will be discussed in the following sections. In addition, the UPSL
computed the amount of emissions that would be generated and the cost of
electricity generation38 for both plans of the DOE for 2003 to 2012.
4.3 DOE Plan for the Low Economic Growth Scenario
Energy Generation
Figure 4.2 shows the energy generation projected by the DOE that would meet the
future energy requirements in 2003 to 201239. For this period, energy generation is
projected to increase at an average rate of 7.57% annually and 93% over the entire
period. From 55,142 GWh in 2003, generation would almost double to 106,430 GWh
in 2012.
120000
100000
80000
60000
GWh
40000
20000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Figure 4.2: Generation under the Low Economic Growth Scenario
38
Generation costs were calculated using generic data for investment, O & M and fuel costs. Costs
calculated do not include ancillary, transmission and distribution costs.
39
Details of the calculations made for this section are provided in Appendix C.
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Installed Generating Capacity
Total installed capacity for 2003 is 14,632 GW and will increase to 20,706 MW by
2012. As shown in Figure 4.3, the increase in demand requirement will be met
mostly by increases in oil-based and coal plant capacities of 1,775 MW and 3,500
MW, respectively40. The increase in the share of renewable energy generating
capacity, amounting to 800 MW, will be due to a 795 MW hydro capacity, 65 MW
wind capacity and a 40 MW geothermal capacity additions. No additional capacity
addition for natural gas is expected in the period.
These figures just show the continued preference on the use coal over natural gas,
which is a more expensive fuel, and renewable energy plants, which are more capital
intensive. Notably, this scenario is very similar to how the Philippine power sector
performed historically.
Reserve Margin and Reliability
Table 4.2 summarizes the results of the UPSL’s calculation for the DOE’s plan for
the LEGS. The table also computes the capacity that would be required if the
percentage reserve margin was kept at 20%. Notable are the considerably high
reserve margins for 2003 to 2009. These high reserve margins would translate to
higher electricity prices during the period.
25,000
20,000
15,000
MW
10,000
5,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Oil-based Coal Natural Gas Geothermal Hydro Wind Demand (MW)
Figure 4.3: DOE Plan for Installed Capacity

for the Low Economic Growth Scenario
40
In the PEP, committed and indicative capacity additions for each year in the planning period are
given. For indicative plant additions, the UPSL assumed that indicative base load capacity will be coal
plants while intermediate and peaking plants corresponds to oil-based plants.
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Table 4.2: Percentage Reserve Margin for the DOE Plan

for the Low Economic Growth Scenario, 2003-2012
Percentage Capacity
Peak Demand Installed Reserve Required for
Year (MW) Capacity (MW) Margin 20% Reserve
(%) Margin
2003 8,833 14,632 66 10,600
2004 9,519 15,120 59 11,423
2005 10,277 15,615 52 12,332
2006 11,139 15,865 42 13,367
2007 11,997 16,015 33 14,396
2008 12,869 16,565 29 15,443
2009 13,813 17,505 27 16,576
2010 14,814 18,405 24 16,576
2011 15,889 19,756 24 17,777
2012 17,033 20,706 22 20,440
Energy Mix
For the LEGS, the PEP expects that for the year 2003, coal, natural gas and oil-
based sources will supply 34%, 24% and 5%, respectively, of the total 55,143 GWh
generation. Renewable energy sources, particularly geothermal and hydro, will
supply 26% and 11%, respectively, of the total generation.
A look at the energy mix (Figures 4.4 and 4.5) for the planning period indicates
minimal thrust towards more use of renewable energy sources and cleaner fuels.
From a share of 37% in 2003, renewable energy’s share decreases to 22% in 2012.
Contribution from wind sources stays insignificant for the whole period. Clean fuels’
(renewable energy and natural gas) share in the energy mix decreases from 61% to
41% by 2012.
The combined contribution of coal and oil to the energy mix, on the other hand will
increase to 59% in 2012 to from a value of 38% in 2003.
Fuel Consumption
To meet demand and energy requirements, this scenario would require 124.5 million
barrels of oil, 91,895,066 tonnes of coal and 1,263 billion cubic feed (BCF) of natural
gas for the whole planning period. Of these amounts, 124.5 tonnes of oil and
80,224,393 tonnes of coal would have to be imported41. Imported fuel would cost
$4,324 million. The breakdown of the fossil fuel that would be consumed in the
LEGS-PEP scenario is shown in Figure 4.6.
41
This assumes that:
• local natural gas production can support 3,800 MW capacity of 23,208 GWh energy production
annually, and;
• share of imported coal is 87.3% of total consumption, as it was in 2001.
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100%
80%
60%
40%
20%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Oil-based Coal Natural Gas Geothermal Hydro
Figure 4.4: Energy Mix for the DOE Plan for the Low Economic Growth
Scenario
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Coal and Oil-Based Renewable Energy and Natural Gas
Figure 4.5: Coal and Oil-Based vs. Renewable and Natural Gas Energy Mix
for the DOE Plan for the Low Economic Growth Scenario

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Environmental Emissions and Abatement Costs
The environmental emissions resulting from DOE’s generation plan for LEGS are
calculated in this report. Total CO2 emissions for the period amounts to 309.3 million
tonnes. Table 4.3 shows the values for the years 2003 and 2012 and Figure 4.7
shows the contribution of each type to the CO2 emissions. Appendix C shows the
amount of emissions for the whole planning period.
As would be expected, the increase in the use of coal would result in an increase in
CO2, SOx and other emissions. Coal contributes 55% of the CO2 emissions for the
period. Oil-based and natural gas plants contribute 17% and 26% to the CO2
emissions, respectively. Geothermal plants contribute only 2%.
Total cost of abatement for this scenario is $ 29,368,137,71642.
Generation Cost
The present value of the costs calculated for the PEP-LEGS is given below. Table
3.4 lists down the generation costs calculated for each year of the planning period,
along with the assumptions used. Average generation cost for the period is PhP
3.1592 per kWh. These generation costs were computed from the values for
investment, fuel, and operations and maintenance costs involved in the operation of
the different plants to meet demand and energy requirements for the scenario.
These do not take into account the effect on the generation cost by deals made with
independent power producers.
Investment cost: $ 11,744,391,189

O&M cost: $ 2,707,454,434
Fuel cost: $ 9,376,479,292
Total: $ 23,828,324,916
42
Abatement costs values in this chapter and the chapters that follow were computed using
abatement costs for SOx , NOx and particulates for the North Coast of California, as given in Chapter
1.
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100,000,000
90,000,000
80,000,000
70,000,000
60,000,000
(tonnes)
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
0
Oil-based Coal Natural Gas
Imported Fuel Indigenous Fuel
Figure 4.6: Fossil Fuel Consumption for the DOE Plan

Table 4.3: Environmental Emissions for the DOE Plan

(tonnes)
Emission Type Year 2003 Year 2012

CO2 18,778,850 46,669,611
SO2 159,289 489,821
NOX 112,712 295,788
CO 21,362 54,323
CH4 282 644
NMVOC 1,581 3,432
N2O 952 2,389
Particulates 19,927 55,647

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50,000,000
45,000,000
40,000,000
35,000,000
30,000,000
tonne CO2
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Figure 4.7: Carbon Dioxide Emissions for the DOE Plan

Table 4.4: Generation Costs for the DOE Plan

for the Low Economic Growth Scenario, 2003-2012
Generation Cost
Year
$/kWh PhP/kWh*
2003 0.0554 3.0447
2004 0.0564 3.1026
2005 0.0568 3.1229
2006 0.0553 3.0409
2007 0.0553 3.0429
2008 0.0564 3.0997
2009 0.0584 3.2123
2010 0.0592 3.2548
2011 0.0601 3.3072
2012 0.0612 3.3636
Average 0.0574 3.1592
Assumptions:
Discount rate 12%
Inflation rate 3%
Fuel escalation rate 2%
* $1 = PhP 55

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4.4 DOE Plan for the High Economic Growth Scenario
Energy Generation
In the high economic growth scenario, generation is expected to increase from

55,556 GWh in 2003 to 118,470 GWh in 2012, increasing more than 200 percent
within the ten-year planning period. Figure 4.8 shows the expected generation under
the HEGS.
140000
120000
100000
80000
GWh
60000
40000
20000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Figure 4.8: Generation under the High Economic Growth Scenario
Installed Generating Capacity
Installed generating capacity would increase from 14,632 MW in 2003 to 22,756 MW

in 2012, corresponding to a 56% increase within the ten-year planning period. A
large part of this increase is due to the addition of coal plants. Figure 4.9 shows how
the installed generating capacity would change from 2003 to 2012.
Reserve Margin and Reliability
Similar to LEGS, the percentage reserve margin in the HEGS is considerably high,
with a minimum value of 26% and a maximum of 65%. Table 4.5 lists down the
percentage reserve margins for the PEP Plan for the HEGS.

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25,000
20,000
15,000
MW
10,000
5,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Oil-based Coal Natural Gas Geothermal Hydro Wind Demand (MW)
Figure 4.9: DOE Plan for Installed Capacity

for the High Economic Growth Scenario
Table 4.5: Percentage Reserve Margin for the DOE Plan

for the High Economic Growth Scenario, 2003-2012
Percentage Capacity
Peak Demand Installed Reserve Required for
Year
(MW) Capacity (MW) Margin 20% Reserve
(%) Margin
2003 8,883 14,632 65 10,660
2004 9,633 15,120 57 11,560
2005 10,469 15,615 49 12,563
2006 11,424 15,865 39 13,709
2007 12,378 16,065 30 14,854
2008 13,359 16,765 25 16,031
2009 14,423 18,155 26 17,308
2010 15,562 20,005 29 18,674
2011 16,790 21,806 30 20,148
2012 18,106 22,756 26 21,727

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Energy Mix
From Figures 4.10 and 4.11, it is quite evident that dependence on non-renewable
energy for power generation remains strong. While the share of renewable energy
declines to 20% by 2012 from 37% in 2003, the share of non-renewable energy
increases to 80%.
Much of the increase in the share of non-renewable energy may be attributed to oil
whose shares increase from 5% to 17%, and natural gas whose contribution ranges
from 24% to 17% for the period considered. Coal share remains very significant at
47% in 2012.
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Oil-based Coal Natural Gas Geothermal Hydro Wind
Figure 4.10: Energy Mix for the DOE Plan

Fuel Consumption
barrels of oil, 98,322,120 tonnes of coal and 1,272 BCF of natural gas for the whole
planning period. Of these amounts, 184.5 million barrels of oil 85,835,211 tonnes of
coal would have to be imported. Total cost of imported fuel is $5,127 million. The
breakdown of fossil fuels that will be used in the HEGS-PEP scenario is shown in
Figure 4.12.

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100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Non-Renewable Energy (w/o Nat Gas) Renewable Energy with Nat Gas
Figure 4.11: Share of Renewable and Non-Renewable Energy in the Energy Mix
for the DOE Plan for the High Economic Growth Scenario
100,000,000
90,000,000
80,000,000
70,000,000
60,000,000
(tonnes)
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
-
Figure 4.12: Fossil Fuel Consumption for the DOE Plan


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Environmental Emissions and Abatement Costs
With the continuous decline in the share of renewable energy in the energy mix from
37% to a mere 20% within the planning period, greenhouse has emissions is to
further soar. Total CO2 emissions for the period is 347.2 million tonnes. An estimate
of the environmental emissions is provided in Table 4.6. Figure 4.13 illustrates the
contribution of each energy source to CO2 emissions resulting from the DOE plan for
the HEGS.
Total abatement cost for the HEG-PEP Scenario is $32,995,165,568.
Table 4.6: Environmental Emissions for the DOE Plan

(tonnes)
Emission Type Year 2003 Year 2012

CO2 19,050,843 565,294,829
SOx 167,211 631,317
NOx 111,064 326,945
CO 21,751 70,610
CH4 283 778
NMVOC 1,599 4,409
N2O 970 2,820
Particulates 19,677 61,132
Generation Cost
The PEP-HEGS Scenario will require the following costs:

O&M cost: $ 2,764,680,225
Fuel cost: $ 10,236,076,758
Total: $ 25,059,779,896
Based on the installed capacities and energy generation indicated in the PEP for the
HEGS, the UPSL obtained the following shown in Table 4.7 for energy generation
cost for 2003 to 2012.

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60,000,000
50,000,000
40,000,000
tonne CO2
30,000,000
20,000,000
10,000,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Figure 4.13: Carbon Dioxide Emissions for the DOE Plan

Table 4.7: Generation Costs for the DOE Plan

for the High Economic Growth Scenario, 2003-2012
Generation Cost
Year
$/kWh PhP/kWh*
2003 0.0549 3.0175
2004 0.0555 3.0545
2005 0.0557 3.0640
2006 0.0542 2.9810
2007 0.0543 2.9853
2008 0.0553 3.0392
2009 0.0582 3.2021
2010 0.0598 3.2889
2011 0.0612 3.3646
2012 0.0635 3.4908
Average 0.0573 3.1488
Assumptions:
Discount rate 12%
Inflation rate 3%
Fuel escalation rate 2%
* $1 = PhP 55

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5 CLEAN POWER DEVELOPMENT OPTIONS
Using the mitigation options identified in Section 2, four alternative strategies were
used to develop mitigation scenarios that meet the demand and energy requirements
of the Low Economic Growth Scenario and the High Economic Growth Scenario.
These strategies are the following:
• Moderate Clean Power Development (CCPD) Option
In this option, capacity addition and utilization of renewable energy (geothermal,

biomass, wind and hydro power) and natural gas plants are given priority over
that of non-renewable plants for power generation. Total installed capacity of
wind power plants is allowed to reach a maximum of 5% of the peak demand.
• Aggressive Clean Power Development Option
For this option, the strategy is to utilize all the practical renewable energy
resources where possible while keeping the appropriate reserve margins and
diversity of resources.
It is assumed in these options that the local natural gas industry will be able to
supply fuel for up to 3,800MW43 (equivalent to 23,208 GWh) natural gas power
plants for the next twenty years. The additional requirement will be supplemented by
imports from the neighboring Asian countries and other natural gas producers until
new local resources are developed.
For all the options, the percentage installed reserve margin for the years 2008
onwards is kept as close as possible to the corresponding PEP reserve margins for
comparison. Note, however, that these reserve margins do not take into account the
ancillary diesel engines, which will serve as back up to the wind power plants. The
capital costs of the ancillary diesel engines are, on the other hand, considered in the
investment cost of the plants.
UPSL capacity additions start in 2008 assuming a five-year lead-time for the
planning and commissioning of the additional power plants. The 2003 to 2007
capacity additions were based solely on the PEP list of committed projects. The
projected generation for each fuel type for 2003 to 2007 is, likewise, lifted from the
PEP.
The annual installed capacities per fuel type for each grid are provided in Appendix
D. The candidate and practical renewable resources, which were used as basis for
the above options, are given Appendix A.
The following sections discuss the resulting energy mix, fuel usage, and emissions
for the abovementioned options.
43
Natural Gas Plan, DOE
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5.1 LEGS-MCPD Scenario
In this scenario, the Moderate Clean Power Development option is applied to the
Low Economic Growth Scenario. Details of this scenario is given in Appendix D.
Installed Capacity
As shown in Figure 5.1, natural gas capacity would continue to increase until the end
of the planning period. Also, renewable energy plant installed capacity is increased
by 95% from 4,450 MW in 2003 to 8,685 MW in 2012. By 2012, natural gas and
renewable energy plant capacities would amount to 69% of the total installed
capacity.
Reserve Margin
The 2008 to 2012 installed capacity reserve margins for the LEGS-MCPD option for
Luzon and Visayas fall within the LEGS-PEP range of 22% to 29%. For Mindanao,
however, the reserve margin is quite higher at 42% to 48%. This is because more
power plants are required to meet Mindanao’s energy demand, which cannot be
addressed with the low dependable capacity of its existing plants. Note also that
wind power plants, which were used in this option to address the additional power
and energy demand, have lower capacity factors compared to coal power plants,
which were used in the PEP scenarios.
Energy Mix
The share of renewable energy for the LEGS-MCPD option would increase by 10%
from the period 2003 to 2012. The total share of clean energy in the energy mix
increases by 18% due the 148% boost in energy generation from natural gas power
plants. The share of coal and oil in the mix would reduce by about 28% at the end of
the period. The energy mix and share of clean energy for the option are shown in
Figure 5.2 and 5.3, respectively.
Fuel Consumption
barrels of oil, 73,945,279 tonnes of coal and 1,502.4 BCF of natural gas for the
whole planning period. Of these amounts, 58.8 million barrels of oil, 64,554,228
tonnes of coal and 154.9 BCF of natural gas would have to be imported. This is
shown in Figure 5.4. Total cost of fuel that need to be imported for this scenario is $
3,060 million.

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25,000
20,000
15,000
MW
10,000
5,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year

Hydro Biomass Wind Demand (MW)
Figure 5.1: Installed Generating Capacity for the LEGS-MCPD Scenario
Environmental Emissions and Abatement Cost
As would be expected, GHG emissions from the LEGS-MCPD are much lower than
that from the LEGS-PEP. Total CO2 emissions for the LEGS-MCPD Scenario is
264.7 million tonnes, achieving net reduction of 44.6 million tonnes of CO2 as
compared to the LEGS-PEP. Figure 5.5 illustrates the CO2 emissions calculated
from this option.
Total cost of abatement of other emissions for this option is $23,202 million. The
LEGS-PEP abatement cost is $6,166 million higher than that of the LEGS-MCPD.
Generation Cost
For this LEGS-MCPD, computed cost values for the planning period are as follows:

O&M cost: $ 2,755,507,508
Fuel cost: $ 8,723,479,053
Total: $ 23,592,955,815
Average generation cost: $ 0.0568 or PhP 3.1235
The LEGS-MCPD will achieve a net savings of $ 236 million as compared with the
LEGS-PEP.

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100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Oil-based Coal Natural Gas Geothermal Hydro Biomass Wind
Figure 5.2: Energy Mix for the LEGS-MCPD Scenario
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
for the LEGS-MCPD Scenario

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80,000,000
70,000,000
60,000,000
50,000,000
(tonnes)
40,000,000
30,000,000
20,000,000
10,000,000
-
Figure 5.4: Fossil Fuel Consumption for the LEGS-MCPD Scenario
40,000,000
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Figure 5.5: CO2 Emissions for the LEGS-MCPD Scenario

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5.2 LEGS-ACPD Scenario
In this scenario, the Aggressive Clean Power Development Option is applied to the
Low Economic Growth Scenario.
Installed Capacity
In this option, renewable energy capacity is increased from 4,450 MW in 2003 to

11,520 MW in 2012. This 159% increase in renewable capacity is largely attributable
to the increase in wind capacity from zero in 2003 to 3,480 MW in 2012 and the
further increase in the utilization of geothermal and biomass resources. In this
option, wind power plants take 20.40% of the peak demand. Figure 5.6 shows the
installed capacities for the LEGS-ACPD option.
Reserve Margin
For Luzon and Visayas, the average reserve margins are 33% and 26%,
respectively. Mindanao’s average reserve margin, for 2008 to 2012, is 53%. The
average for the country is 34%.
Energy Mix
Figure 5.7 illustrates the energy mix resulting from the LEGS-ACPD option. The 30%
increase in renewable energy share from 37% to 48% over the planning period,
brings the clean energy generation from 33,794 GWh in 2003 to 84,270 GWh in
2012. Figure 5.8 shows the increase in clean energy share in the mix.
Fuel Consumption
Total fuel requirement for the LEGS-ACPD is 66,523,175 tonnes of coal, 1471.7 BCF
of natural gas and 57.2 million barrels of oil. Coal importation for this option reaches
58,074,731 tonnes, while importation of oil and natural gas stand at 57.2 million
barrels and 139.4 BCF, respectively. The mix of imported and indigenous fuel is
shown in Figure 5.9. Total cost of fuel that is needed to be imported for this scenario
is $ 2,860 million.
The increased utilization of renewable energy resources, in this option, brings the
CO2 emission level at 321.34 tonnes/GWh. The total CO2 emissions for the period is
248.4 million tonnes, which is 60.9 million tonnes less than the LEGS-PEP. The total
CO2 emissions for each year are shown in Figure 5.10. Total cost of abatement for
this option is $ 21,294,633,715.

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25,000
20,000
15,000
MW
10,000
5,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year

Figure 5.6: Installed Generating Capacity for the LEGS-ACPD Scenario
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Figure 5.7: Energy Mix for the LEGS-ACPD Scenario

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100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
for the LEGS-ACPD Scenario
90,000,000
80,000,000
70,000,000
60,000,000
(tonnes)
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
0
Figure 5.9: Fossil Fuel Consumption for the LEGS-ACPD Scenario

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40,000,000
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Figure 5.10: CO2 Emissions for the LEGS-ACPD Scenario
Generation Cost
For this LEGS-ACPD, computed cost values for the planning period are as follows:

O&M cost: $ 2,816,132,094
Fuel cost: $ 8,403,414,012
Total: $ 23,880,603,671
This scenario would cost $52 million more than the LEGS-PEP.
5.3 HEGS-MCPD Scenario
In this scenario, the Moderate Clean Power Development option is applied to the
High Economic Growth Scenario.
Installed Capacity
The installed capacity for this option is given in Figure 5.11. Natural gas capacities
are increased throughout the period and would account for the biggest share in
installed capacity by 2012. Renewable energy capacity accounts for 30% in 2003
and 39% in 2012.

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Reserve Margin
The effective reserve margin of 27% to 31% for the whole country of the HEGS-
MCPD option is close to the HEGS-PEP range of 25% to 30% for 2003 to 2012. This
difference is attributable to the inevitable higher reserve margin for Mindanao, which
falls within 35% to 48%.
Energy Mix
With its installed capacities dominating, renewable energy and natural gas
contribution to the energy mix increases from 61% to 74% for 2003 to 2012. Of this
mix, 2% is contributed by wind power plants. Figure 5.12 shows the corresponding
energy mix for the HEGS-MCPD option, while Figure 5.13 illustrates the clean
energy mix.
Fuel Consumption
whole planning period. Of these amounts, 70.7 million barrels of oil, 64,549,857
tonnes of coal and 342.8 BCF tonnes of natural gas would have to be imported.
Total cost of fuel imports is $ 3,322 million.
Figure 5.15 shows the CO2 emissions resulting from the HEGS-MCPD option. The
total CO2 emissions is at 283.8 million tonnes, which is 63.4 million tonnes lower
than the HEGS-PEP.
Total abatement cost for this option is $ 24,076,349,686.
Generation Cost
For this HEGS-MCPD, computed cost values for the planning period are as follows:

O&M cost: $ 2,807,665,124
Fuel cost: $ 9,580,347,302
Total: $ 24,778,781,456

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25,000
20,000
15,000
MW
10,000
5,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year

Figure 5.11: Installed Generating Capacity for the HEGS-MCPD Scenario
100%
80%
60%
40%
20%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Figure 5.12: Energy Mix for the HEGS-MCPD Scenario

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100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
for the HEGS-MCPD Scenario
80,000,000
70,000,000
60,000,000
50,000,000
(tonnes)
40,000,000
30,000,000
20,000,000
10,000,000
-
Figure 5.14: Fossil Fuel Consumption for the HEGS-MCPD Scenario

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40,000,000
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Figure 5.15: CO2 Emissions for the HEGS-MCPD Scenario
5.4 HEGS-ACPD Scenario
In this option, the Aggressive Clean Power Development option strategy is applied to
the High Economic Growth Scenario.
Installed Capacity
The more aggressive use of renewable energy resources for this option results to a
50% contribution of renewable energy to the total installed capacity in 2012. Figure
5.16 illustrates this.
Reserve Margin
With the inevitably high reserve margin of 45% to 51% for Mindanao, the country’s
effective reserve margin ranges from 28% to 32%.
Energy Mix
While oil-based and coal share in the energy mix decreased by 38%, clean energy
share increased by 24% over the planning period. Figure 5.17 and Figure 5.18
illustrate these changes in the energy mix.

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Fuel Consumption
whole planning period. All of the oil would have to be imported, along with
59,182,139 tonnes of coal and 276.7 BCF of natural gas. Figure 5.19 shows the
sharing of the imported and indigenous fossil fuels. Cost of fuel imports is $ 3,513
million.
Carbon dioxide generation for the HEGS-ACPD option is shown in Figure 5.20. Total
CO2 emissions is at 275.1 million tonnes, 72.1 million tonnes lower than that for the
HEGS-PEP.
The cost of abatement for SOx , NOx and particulates for this option is
23,288,583,560.
Generation Cost
For this HEGS-ACPD, computed cost values for the planning period are as follows:

O&M cost: $ 2,842,402,567
Fuel cost: $ 9,532,723,271
Total: $ 25,199,584,568

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25,000
20,000
15,000
MW
10,000
5,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year

Hydro Biomass Wind Peak Demand
Figure 5.16: Installed Generating Capacity for the HEGS-ACPD Scenario
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Year
Figure 5.17: Energy Mix for the HEGS-ACPD Scenario

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100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
for the HEGS-ACPD Scenario
80,000,000
70,000,000
60,000,000
50,000,000
(tonnes)
40,000,000
30,000,000
20,000,000
10,000,000
0
Figure 5.19: Fuel Consumption for the HEGS-ACPD Scenario

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40,000,000
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Figure 5.20: CO2 Emissions for the HEGS-ACPD Scenario

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6 Conclusions and Recommendations
The Philippine power sector from 1991 to 2001 has not performed very well in terms
of reliability and cost to end-users. While the PEP has tried to address these
problems, it fails to consider the implications of the activities in this sector to the
environment that could even be more important if only the externalities will be
considered in the economics of energy supply.
Historically, the installed capacity and hence the energy mix has been dominated by
non-renewable energy. In the medium term, the business-as-usual Philippine Energy
Plan 2003 – 2012 does not offer a different scenario. The contribution from
renewable energy is expected to decline in the next 10 years, which will worsen the
situation from the point of view of clean and sustainable development.
This study has assessed the technologies and resources in the Philippines that could
be tapped for clean power development. The country has nearly exhausted its
geothermal and large hydro resources. To avoid significant amounts of GHG
emissions in the future, the country has to resort to biomass, small hydro, wind and
natural gas technologies, as was done in this study. At the moment, the local natural
gas industry is anchored on the natural gas find in Malampaya. To support power
switching, new natural gas sites must be identified and developed. In addition,
natural gas importation may be pursued.
Another issue is the intermittent nature of wind power, which could adversely affect
the power system’s stability at high levels of penetration. To aid planning and
operation of the power system, study must be made to determine how much wind
power capacity the local power system grids could absorb.
Biomass power is also an attractive option for grid-connected generation. But it is still
associated with problems such as fuel collection, storage and therefore requires that
more research and development activities to address these issues.
This study also offers two alternative paths or strategies (moderate and aggressive)
through the alternative clean power development plans. These alternative plans are
comparable to the PEP in terms of costs. There are even opportunities that can
create additional dollar income from carbon trading and local employment. At the
current CO2 prices ($5 per tonne) in the market, the Moderate Clean Power
Development Plans are viable greenhouse gas mitigation option for the Philippines
offering so many opportunities both for the developers and the country. Switching to
cleaner energy, therefore, is attractive as the price of carbon is expected to increase
in the future.
Pursuing the Clean Power Development plans requires the development of a “clean
energy” market in the country through effective policy instruments and mechanisms
that will secure the investment climate while protecting public interest. In the
following paragraphs, we have outlined a set of measures that should be made to
attract more investments in renewable generation technologies in the future.

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6.1 Energy Planning
The first step in developing the market for clean energy is to introduce reforms in the
process of energy planning itself. Since power developers will only respond to the
government call, it is important that the Philippine Energy Plan reflect the call for
clean power development. This could be achieved through the following:
• Improve the power development planning models
- Include environmental externalities in planning models to reflect the true

cost to society of energy decisions;
- Consider the economics of smaller capacity, following load growth to deal
with the overcapacity issue (in contrast to large capacity power plants
currently used in energy planning);
- Include energy efficiency as a demand side option in energy planning
models;
- Use coal-fired fluidized combustion technology as benchmark fossil-based
plant instead of pulverized coal;
- Increase the number of candidate Renewable Energy-based Power Plants
in the selection process. To increase the number of candidate renewable
energy plants in planning, more rigorous and site-specific resource
assessment must be conducted.
• Institutionalize a participative planning process. A decentralized planning process
down to the level of the local government and participated by the stakeholders in
the locality should complement the top-down planning process at the national
level. Electrification planning can be done in the municipality/city levels. Resource
assessment and local supply and demand balance can be done at the provincial
level. This decentralized planning scheme will result in a more realistic demand
forecast and will address local issues on energy, as well as issues on under- and
overcapacity. While this planning process allows for a greater degree of public
participation, it will also entail capacity building for local government units in the
areas of planning and resource assessment. A schematic of the proposed
planning process is shown in Figure 6.1.

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National Energy Plan

Centralized System Planning and
Private Sector Proposals
National Level Integration of Provincial Plans
Provincial Energy Plan

Provincial Level Resource Assessment and
Local Supply and Demand Balance
City/Municipality City/Municipality Energy Plan

Level Electrification Planning
Figure 6.1: Recommended Bottom-Up Approach to Energy Planning
6.2 Transmission and Distribution Development
Transmission and distribution infrastructure should be developed to increase access

to renewable energy sites, most of which are site specific. Transmission facilities
should deliberately be expanded toward locations of promising renewable energy
sources.
The cost of such an expansion should be borne by the transmission or distribution

utility. This cost mechanism will ensure that all electricity consumers will share the
cost of such a development. The Energy Regulatory Commission (ERC) should
allow such an expansion even if it does not initially show recovery of investment.
6.3 Rules and Regulation
• The Wholesale Electricity Spot Market (WESM) Rules must provide that
intermittent and small-scale grid-connected renewable energy generation
systems (such as wind, run-of-river small hydro and biomass) should be given
priority in the dispatch of generating units. These plants must “feed-in” the Grid at
minimum prices that will guarantee the returns of power developers.
• The System Operator should be allowed to procure ancillary services needed by
the Grid to accommodate intermittent wind power and pass on the cost to all
users of the Grid.
• The Philippine Grid and Distribution Code (PGDC) must be clear on its
requirements and procedures on the connection, operation and control of non-
conventional, renewable energy-based power plants, particularly on the required
technical analysis and compensating equipment.

UPEEE Foundation
POWER SWITCH!
6.4 Incentive Programs
• The Department of Energy must ensure that renewable energy development

should always be included in the Philippine Investment Priorities of the Board of
Investment to ensure that the fiscal (e.g., tax exemptions, income tax holidays
and tax credits) and non-fiscal (e.g., simplification of custom procedures and
importation of consigned equipment) will be available for renewable energy
developers.
• An assistance program should be created for renewable energy development.
This may include subsidy for resource assessment and feasibility studies for
serious developers of renewable energy.
• Dedicated Financing Windows that allow longer repayment periods for renewable
energy-based development.

UPEEE Foundation
POWER SWITCH!
7 REFERENCES
Bain, Richard L., Biomass-Fired Power Generation, IEA Bioenergy Implementing

Agreement, October 1996.
Elliot, D., et al., Wind Energy Resource Atlas of the Philippines, National Renewable
Energy Laboratory (February 2001).
Estiva, J.N., and Guzman, M.G., Renewable Energy Prospects for Supplying
Electricity in the Deregulated Market in the Philippines.
Koomey, Jonathan and Krause, Florentin, “Introduction to Environmental Externality

Costs,” CRC Handbook on Energy Efficiency, Boca Raton, FL: CRC Press, Inc.,
1997.
Parsons, B., “Grid-Connected Wind Energy Technology: Progress and Prospects”,

paper presented at the North American Conference of the International Association
of Energy Economists, Albuquerque, New Mexico (October 1998).
Sundqvist, T. “Power Generation Choice in the Presence of Environmental

Externalities.” Doctorate Thesis. Luleá University of Technology, 2002.
Wan, Y., and B. Parsons, “Factors Relevant to Utility Integration of Intermittent

Renewable Technologies”, National Renewable Energy Laboratory (1993).
Choices for a Brighter Future (United States of America Department of Energy,

September 1999).
Environmental Manual (EM) for Power Development, OKÖ Institute, Germany (1999)
Natural Gas Plan, Philippines Department of Energy
Philippine Energy Plan 2002-2011, Philippines Department of Energy.
Philippine Energy Plan 2003-2012, Philippines Department of Energy.
Philippine Motor Market Characterization, Leverage International (Consultants) Inc.

(February 1998).
Philippine New Commercial Building Market Characterization, Leverage International

(Consultants) Inc. (March 1998)
Renewable Energy, Godfrey Boyle, ed., The Open University, Milton Keynes (1996).
Scenarios for a Clean Energy Future
Strengthening the Non-Conventional and Rural Energy Development Program in the

Philippines: A Policy Framework and Action Plan, joint UNDP/World Bank Energy
Sector Management Assistance Program (ESMAP), (August 2001).

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POWER SWITCH!
The EM Generic Database, Deutsche Gessellschaft für technische (Zusammenarbeit

GmbH, updated March 1999).
The Philippines’ Initial National Communication on Climate Change
www.eere.energy.gov/state_energy
Ledesma, Alexis. Bronzeoak Philippines, Makati, Philippines. Interview, 25 July

2003.

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Appendix A
Practical Wind and Hydro Resource
Potential in the Philippines
Appendix A POWER SWITCH!
Table A.1: Locations of Practical Wind Resources in Luzon
Estimated Estimated
Province Number of Sites Aggregate Capacity Aggregate Annual
(MWe) Generation (GWh)
Abra 26 183 567
Albay 26 183 576
Aurora 46 320 1,011
Bataan 26 169 530
Batangas 16 104 328
Benguet 20 137 421
Bulacan 2 41 126
Cagayan 8 80 246
Camarines Norte 18 117 372
Camarines Sur 36 234 742
Cavite 8 87 267
Ifugao 15 98 299
Ilocos Norte 31 265 832
Ilocos Sur 8 52 161
Isabela 90 620 1,922
Kalinga 21 158 484
Laguna 5 40 125
Mountain Province 5 33 100
Nueva Ecija 20 151 478
Nueva Vizcaya 43 315 971
Pampanga 7 46 143
Pangasinan 17 125 382
Quezon 11 86 263
Quirino 21 165 509
Rizal 15 98 307
Sorsogon 24 163 509
Tarlac 4 40 123
Zambales 117 796 2,486
LUZON TOTAL 686 4906 15,280
University of the Philippines Solar Laboratory page 1 of 4

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Table A.2: Locations of Practical Wind Resources in Visayas
Estimated Capacity Estimated Annual

Province Number of Sites
Aklan 24 163 517
Antique 41 309 965
Biliran 20 144 466
Bohol 6 39 120
Capiz 1 7 20
Cebu 30 202 620
Eastern Samar 2 14 43
Iloilo 12 85 266
Leyte 52 357 1,113
Negros Occidental 26 169 519
Negros Oriental 48 347 1,065
Samar 10 75 229
Southern Leyte 33 259 795
VISAYAS TOTAL 305 2,170 6,738
Table A.3: Locations of Practical Wind Resources in Mindanao

Province No. of Sites
Agusan del Norte 19 133 408
Agusan del Sur 6 42 129
Camiguin 4 28 86
Surigao del Norte 14 105 322
Surigao del Sur 4 28 86
MINDANAO TOTAL 47 336 1,031

UPEEE Foundation
Table A.4. Locations of Practical Small Hydro Potential Resources in Luzon
Province Number of Sites Estimated Capacity Estimated Annual

(MWe) Generation (GWhr)
Abra 20 196 1,030
Aurora 1 10 53
Benguet 9 79 415
Ifugao 3 32 168
Ilocos No rte 3 22 116
Ilocos Sur 4 40 210
Isabela 8 72 378
Kalinga 30 318 1,671
La Union 6 35 184
Mountain Province 3 34 179
Nueva Vizcaya 15 181 110
Pangasinan 4 26 951
Quezon 3 28 147
Quirino 19 179 941
Tarlac 1 6 32
LUZON TOTAL 129 1,258 6,585
Table A.5. Locations of Practical Small Hydro Potential Resources in Visayas
Province Number of Sites Estimated Capacity Estimated Annual

Aklan 1 5 26
Eastern Samar 5 33 173
Negros Occidental 2 13 68
Negros Oriental 1 7 37
VISAYAS TOTAL 9 58 304

UPEEE Foundation
Table A.6. Locations of Practical Small Hydro Potential Resources in Mindanao

Province Number of Sites (MWe) Generation (GWh)
Agusan del Norte 3 18 95
Bukidnon 21 322 1,692
Davao 7 7 7
Davao Oriental 18 18 18
Lanao del Norte 7 53 279
Lanao del Sur 4 26 137
Maguindanao 6 58 305
Misamis Oriental 10 69 363
North Cotabato 18 230 1,209
Sultan Kudarat 1 7 37
Surigao del Sur 2 11 58
Zamboanga del Norte 1 7 37
MINDANAO TOTAL 98 826 4,237

UPEEE Foundation
Appendix B
Historical Performance of the
Philippine Power Sector 1991-2001
Appendix B POWER SWITCH!
Table B.1: Installed Generating Capacity, 1991-2001

(MW)
Fuel Type
Year
Oil-based Coal Natural Gas Geothermal Hydro Biomass Wind Total
1991 3,341 405 0 888 2,155 0 0 6,789
1992 3,399 405 0 888 2,257 0 0 6,949
1993 4,296 441 0 963 2,259 0 0 7,959
1994 5,335 550 0 1,073 2,254 0 0 9,212
1995 5,425 850 0 1,154 2,301 0 0 9,730
1996 5,844 1,600 0 1,417 2,301 0 0 11,162
1997 5,973 1,600 3 1,819 2,301 0 0 11,696
1998 5,568 2,200 3 1,856 2,301 0 0 11,928
1999 4,839 3,493 3 1,931 2,301 0 0 12,567
2000 4,987 3,963 3 1,931 2,301 0 0 13,185
2001 3,927 3,963 1,063 1,931 2,518 0 0 13,402
Source: DOE
Table B.2: Power Generation by Source (1991-2001)

(GWh)
Fuel Type
Year
1991 12,804 1,942 0 5,758 5,145 0 0 25,649
1992 13,939 1,791 0 5,700 4,440 0 0 25,870
1993 13,867 2,015 0 5,667 5,030 0 0 26,579
1994 16,929 1,348 0 6,320 5,862 0 0 30,459
1995 19,078 2,109 0 6,135 6,232 0 0 33,554
1996 18,288 4,855 0 6,534 7,030 0 0 36,707
1997 19,116 7,363 12 7,237 6,069 0 0 39,797
1998 18,190 9,388 20 8,914 5,066 0 0 41,578
1999 11,799 11,183 16 10,594 7,840 0 0 41,432
2000 9,185 16,663 17 11,626 7,799 0 0 45,290
2001 9,867 18,789 848 10,442 7,104 0 0 47,050
Source: DOE
Table B.3: Energy Consumption by Sector, 1991-2001

(GWh)
Year
Year
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Residential 6,249 6,053 6,368 7,282 8,223 9,150 10,477 11,936 11,875 12,894 13,547
Commercial 4,847 4,910 4,725 5,865 6,353 7,072 8,013 8,725 8,901 9,512 10,098
Industrial 9,339 8,859 9,395 10,684 10,950 11,851 12,531 12,543 12,444 13,191 14,452
Others 952 823 721 762 1,067 1,167 1,267 934 921 957 1,042
Utilities Own
1,086 1,154 1,132 1,132 1,226 1,340 1,471 1,590 1,536 2,390 2,196
Use
Power
3,176 4,071 4,238 4,734 5,735 6,128 6,037 5,849 5,754 6,345 5,713
Losses
Total 25,649 25,870 26,579 30,459 33,554 36,708 39,797 41,578 41,432 45,290 47,049
Source: DOE

UPEEE Foundation
Appendix B POWER SWITCH!
Table B.4: Peak Demand, 1991-2001

(MW)
Year 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Luzon 3,045 3,250 3,473 3,561 3,920 4,306 4,773 5,028 5,226 5,649 5,835
Visayas 410 473 523 551 591 682 727 770 789 812 893
Mindanao 626 573 691 696 780 828 852 868 893 939 954
Philippines 4,081 4,296 4,687 4,808 5,291 5,816 6,352 6,666 6,908 7,400 7,682
Source: DOE
Table B.5: Generation by Grid, 1991-2001

(GWh)
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Luzon 19,511 19,967 19,902 23,290 25,206 27,688 30,084 31,755 31,745 34,679 36,184
Visayas 2,376 2,566 2,813 3,036 3,652 3,991 4,347 4,481 4,441 5,147 5,163
Mindanao 3,763 3,337 3,864 4,133 4,695 5,029 5,365 5,343 5,245 5,464 5,703
Philippines 25,649 25,870 26,579 30,459 33,554 36,708 39,797 41,578 41,432 45,290 47,049
Source: DOE
Table B.6: Carbon Dioxide Emissions by Source, tonne CO2

Fuel Type
Year
1991 9,236,541 1,082,279 0 261,413 0 0 0 10,580,233
1992 10,094,675 998,127 0 258,780 0 0 0 11,351,582
1993 10,185,915 1,122,962 0 257,282 0 0 0 11,566,159
1994 12,509,360 751,242 0 286,928 0 0 0 13,547,530
1995 14,131,794 1,175,348 0 278,529 0 0 0 15,585,671
1996 13,519,362 2,705,698 0 296,644 0 0 0 16,521,704
1997 14,119,644 4,103,175 1,789 328,556 0 0 0 18,553,164
1998 13,491,679 5,231,854 3,076 404,674 0 0 0 19,131,283
1999 8,712,872 6,232,261 2,345 480,970 0 0 0 15,428,448
2000 6,870,702 9,286,311 2,563 527,820 0 0 0 16,687,396
2001 7,338,665 10,471,222 127,808 474,067 0 0 0 18,411,762
Table B.6: Environmental Emissions, tonne

Year
CO 2 SOX NOX CO CH4 NMVOC N 2O Particulates
1991 10,580,233 115,725 58,726 16,124 587 975 415 10,989
1992 11,351,582 117,990 67,069 17,090 643 1,038 436 12,639
1993 11,566,159 99,004 84,238 16,083 685 973 421 16,311
1994 13,547,530 101,964 106,586 18,486 835 1,133 469 20,733
1995 15,585,671 114,552 126,633 20,903 963 1,273 541 24,747
1996 16,521,704 135,204 130,492 21,781 974 1,291 610 25,616
1997 18,553,164 160,414 144,932 24,109 1,062 1,403 711 28,555
1998 19,131,283 162,882 154,678 23,836 1,076 1,359 742 30,708
1999 15,428,448 149,848 117,896 18,521 792 1,004 644 23,580
2000 16,687,396 164,831 136,309 18,116 805 906 734 27,727
2001 18,411,762 189,729 146,807 20,796 904 1,075 842 29,611

UPEEE Foundation
Appendix C
Economic Scenarios and DOE Plans
for the Power Sector 2003-2012
Appendix C POWER SWITCH:
Table C.1a: DOE Plan for Power Generation for the Low Economic Growth
Scenario
(GWh)
Year
Type
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-Based 2720 3247 3127 2777 4318 5117 5673 4577 3710 4015
Fuel Oil 2377 2747 2740 2701 4166 4998 5499 4365 3580 3859
Diesel 343 500 388 75 151 119 174 212 130 157
Coal 18629 18087 19953 24659 26446 27561 29218 28828 27420 27606
Local 2820 1101 1289 2216 2586 2862 3200 3108 2789 2842
Imported 15809 16986 18664 22443 23860 24698 26018 25720 24630 24764
Natural Gas 13349 16017 17141 18210 19415 20074 20260 20192 19965 20068
Hydro 6324 6893 7928 7943 7968 8001 8042 8069 8029 8038
Geothermal 14121 14975 15054 15092 15098 15099 15095 15104 15103 15103
Wind 0 153 153 153 153 153 153 153 153 152
Others 0 0 825 746 1551 4433 7920 15713 24910 31448
Baseload 0 0 0 0 1104 2960 4028 10338 19206 25371
Midrange 0 0 825 746 446 1473 3852 4881 5339 5545
Peaking 0 0 0 0 0 0 39 495 365 531
TOTAL 55142 59372 64182 69580 74948 80437 86360 92636 99290 106430
Table C.1b: System Peak Demand Forecasts for the Low Economic Growth
Scenario
(MW)
NATIONAL
YEAR LUZON VISAYAS MINDANAO
Non-Coincident Peak
2003 6,752 1,007 1,074 8,833

2004 7,275 1,084 1,159 9,519
2005 7,855 1,168 1,254 10,277
2006 8,503 1,276 1,360 11,139
2007 9,161 1,377 1,459 11,997
2008 9,830 1,477 1,563 12,869
2009 10,548 1,592 1,673 13,813
2010 11,319 1,707 1,789 14,814
2011 12,149 1,829 1,912 15,889
2012 13,034 1,958 2,041 17,033
Annual Ave. G.R.

(2003 - 2007) 7.93% 8.13% 7.95% 7.95%
(2008 - 2012) 7.31% 7.30% 6.91% 7.26%
(2003 - 2012) 7.58% 7.67% 7.39% 7.57%

UPEEE Foundation
Table C.1c: Electricity Sales Forecasts for the Low Economic Growth Scenario
(GWh)
YEAR LUZON VISAYAS MINDANAO TOTAL
2003 39,604 5,320 6,258 51,182

2004 42,675 5,726 6,754 55,154
2005 46,072 6,170 7,306 59,548
2006 49,875 6,740 7,924 64,539
2007 53,735 7,274 8,497 69,506
2008 57,660 7,801 9,103 74,564
2009 61,870 8,411 9,743 80,024
2010 66,391 9,016 10,420 85,827
2011 71,260 9,661 11,135 92,057
2012 76,452 10,342 11,892 98,686
Annual Ave. G.R.

(2003 - 2007) 7.93% 8.13% 7.95% 7.95%
(2008 - 2012) 7.31% 7.30% 6.91% 7.26%
(2003 - 2012) 7.58% 7.67% 7.39% 7.57%

UPEEE Foundation
Table C.1d: DOE Plan for Installed Capacity for the Low Economic Growth
Scenario
(MW)
Fuel Type Year

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-based 2443 2443 2443 2443 2443 2443 2233 1583 1583 1583
Coal 3758 3758 3758 3758 3758 3758 3758 3758 3758 3758
Local 450 450 450 450 450 450 450 450 450 450
Imported 3,308 3,308 3,308 3,308 3,308 3,308 3,308 3,308 3,308 3,308
Natural Gas 2763 2763 2763 2763 2763 2763 2763 2763 2763 2763
Hydro 1510 1860 2205 2205 2205 2205 2205 2205 2205 2205
Luzon
Geothermal 907 907 907 907 907 907 907 907 907 907
NRE
Wind - 65 65 65 65 65 65 65 65 65
Others
Baseload - - - - - - 600 1500
- 2100
Intermediate - - - - 900- 1200 300
1500 1500
Peaking - - - - - - 300 750 750 900
LUZON TOTAL 11,381 11,796 12,141 12,141 12,141 12,441 13,131 13,831 15,031 15,781
Oil-based 468 431 281 281 281 281 281 281 182 182
Coal 205 205 205 205 205 205 205 205 205 205
Local 150 150 150 150 150 150 150 150 150 150
Imported 55 55 55 55 55 55 55 55 55 55
Natural Gas - - - - - - - - - -
Hydro 12 12 12 12 12 12 12 12 12 12
Visayas
Geothermal 919 959 959 959 959 959 959 959 959 959
NRE
Wind - - - - - - - - - -
Others
Baseload - - - - 100 200 300 400 500 600
Intermediate - - 200 250 250 250 350 350 350 350
Peaking - - - - - - - - - -
VISAYAS TOTAL 1,604 1,607 1,657 1,707 1,807 1,907 2,107 2,207 2,208 2,308
Oil-based 546 616 616 616 616 616 616 616 616 616
Coal - - - 200 200 200 200 200 200 200
Local - - - - - - - - - -
Imported - - - 200 200 200 200 200 200 200
Natural Gas - - - - - - - - - -
Hydro 997 997 997 997 997 997 997 997 997 997
Mindanao
Geothermal 104 104 104 104 104 104 104 104 104 104
NRE
Wind - - - - - - - - - -
Others
Baseload - - - - 50 200 250 350 500 600
Intermediate - - 100 100 100 100 100 100 100 100
Peaking - - - - - - - - - -
MINDANAO TOTAL 1,647 1,717 1,817 2,017 2,067 2,217 2,267 2,367 2,517 2,617

UPEEE Foundation
Fuel Type Year

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-based 3,457 3,490 3,340 3,340 3,340 3,340 3,130 2,480 2,381 2,381
Coal 3,963 3,963 3,963 4,163 4,163 4,163 4,163 4,163 4,163 4,163
Local 600 600 600 600 600 600 600 600 600 600
Imported 3,363 3,363 3,363 3,563 3,563 3,563 3,563 3,563 3,563 3,563
Natural Gas 2,763 2,763 2,763 2,763 2,763 2,763 2,763 2,763 2,763 2,763
Philippines
Hydro 2,519 2,869 3,214 3,214 3,214 3,214 3,214 3,214 3,214 3,214
Geothermal 1,930 1,970 1,970 1,970 1,970 1,970 1,970 1,970 1,970 1,970
NRE
Wind - 65 65 65 65 65 65 65 65 65
Others
Baseload - - - - 150 400 550 1,350 2,500 3,300
Intermediate - - 300 350 350 650 1,350 1,650 1,950 1,950
Peaking - - - - - - 300 750 750 900
PHILIPPINES TOTAL 14,632 15,120 15,615 15,865 16,015 16,565 17,505 18,405 19,756 20,706
Source: Philippine Energy Plan 2003

UPEEE Foundation
Table C.1e: DOE Plan for Power Plant Line-Up for the Low Economic Growth
Scenario
LUZON VISAYAS MINDANAO PHILIPPINES
YEAR
MW installed MW installed MW installed
PLANT ADDITION PLANT ADDITION PLANT ADDITION cumulative total
capacity MW capacity MW capacity MW
Uprating of Leyte-
Bohol
Kalayaan 3&4 Interconnection
from 35 MW to 100
350 345 MW 40 385
2004 PNOC_EDC Wind 40 Mambucal Geo 40

Transfer of a
Diesel Plant to
Mindanao (70
MW) -70
Northwind 25
Uprating of Leyte-
Cebu
San Roque Hydro Interconnection
from 200 MW to Diesel Plant from
2005 345 690 400 MW 240 Luzon 70 170 1,100
Panay Midrange 150 Midrange Plant 100
Negros Midrange 50
2006 690 Panay Midrange 50 290 Mindanao Coal 200 370 1,350
2007 690 Panay Baseload 100 390 Baseload Plant 50 420 1,500
Midrange 300 990 Cebu Baseload 50 490 Baseload Plant 150 570 2,050
2008
Negros Baseload 50
Midrange 600 1,890 Cebu Baseload 50 690 Baseload Plant 50 620 3,200
2009 Peaking 300 Panay Baseload 50
Bohol Midrange 100
Baseload Plant 600 3,240 Cebu Baseload 100 790 Baseload Plant 100 720 4,750
2010 Midrange 300
Peaking 450
2011
Midrange 300 Negros Baseload 50
2012
Peaking Panay Baseload
150 50

UPEEE Foundation
Table C.1f: Total CO2 Emissions by Fuel Type for the DOE Plan for the Low
Economic Growth Scenario
(tonne)
Year Geothermal Coal Natural gas Oil-based TOTAL
2003 641,093 10,114,896 5,897,849 2,125,011 18,778,850
2004 679,865 9,820,609 7,076,624 2,536,797 20,113,894
2005 683,452 10,833,782 7,573,229 3,158,821 22,249,284
2006 685,177 13,388,975 8,045,534 2,816,776 24,936,462
2007 685,449 14,958,687 8,577,927 3,760,465 27,982,528
2008 685,495 16,571,837 8,869,086 5,275,644 31,402,061
2009 685,313 18,051,416 8,951,264 7,803,792 35,491,785
2010 685,722 21,265,770 8,921,220 8,188,273 39,060,985
2011 685,676 25,316,289 8,820,927 7,809,100 42,631,993
2012 685,676 28,764,660 8,866,435 8,352,840 46,669,611
Total for period 6,802,918 169,086,922 81,600,095 51,827,519 309,317,453
Table C.1g: Total SOx Emissions by Fuel Type for the DOE Plan for the Low
(tonne)

2003 - 137,855 104 21,330 159,289
2004 - 133,844 125 25,460 159,429
2005 - 147,652 134 34,201 181,988
2006 - 182,477 143 30,532 213,151
2007 - 203,870 152 39,091 243,113
2008 - 225,855 157 57,410 283,422
2009 - 246,020 159 89,762 335,941
2010 - 289,828 158 94,177 384,163
2011 - 345,032 156 92,491 437,680
2012 - 392,030 157 97,635 489,821
Total for period - 2,304,464 1,445 582,088 2,887,997
Table C.1h: Total NOx Emissions by Fuel Type for the DOE Plan for the Low
(tonne)
2003 - 78,242 21,939 12,531 112,712
2004 - 75,965 26,324 14,962 117,251
2005 - 83,803 28,171 16,963 128,937
2006 - 103,568 29,928 15,103 148,599
2007 - 115,710 31,908 21,279 168,897
2008 - 128,188 32,991 28,138 189,317
2009 - 139,633 33,297 38,410 211,340
2010 - 164,497 33,185 40,521 238,203
2011 - 195,829 32,812 36,808 265,450
2012 - 222,503 32,981 40,303 295,788
Total for period - 1,307,939 303,536 265,019 1,876,493

UPEEE Foundation
Table C.1i: Total CO Emissions by Fuel Type for the DOE Plan for the Low
(tonne)

2003 - 9,873 8,776 2,714 21,362
2004 - 9,586 10,529 3,240 23,355
2005 - 10,575 11,268 4,397 26,241
2006 - 13,069 11,971 3,925 28,966
2007 - 14,602 12,763 4,999 32,363
2008 - 16,176 13,196 7,385 36,758
2009 - 17,620 13,319 11,656 42,595
2010 - 20,758 13,274 12,554 46,586
2011 - 24,712 13,125 12,285 50,121
2012 - 28,078 13,193 13,053 54,323
Total for period - 165,049 121,414 76,207 362,671
Table C.1j: Total CH4 Emissions by Fuel Type for the DOE Plan for the Low
(tonne)
2003 - 103 145 33 282
2004 - 100 174 40 314
2005 - 111 186 49 346
2006 - 137 198 44 379
2007 - 153 211 59 423
2008 - 170 218 82 470
2009 - 185 220 121 526
2010 - 218 219 129 566
2011 - 259 217 122 598
2012 - 294 218 131 644
Total for period - 1,730 2,008 810 4,548
Table C.1k: Total NMVOC Emissions by Fuel Type for the DOE Plan for the Low
(tonne)
2003 - 373 1,045 163 1,581
2004 - 362 1,254 195 1,810
2005 - 399 1,341 267 2,008
2006 - 493 1,425 238 2,157
2007 - 551 1,519 302 2,373
2008 - 610 1,571 449 2,630
2009 - 665 1,586 713 2,963
2010 - 783 1,580 770 3,134
2011 - 933 1,562 755 3,250
2012 - 1,060 1,571 802 3,432
Total for period - 6,228 14,454 4,655 25,337

UPEEE Foundation
Table C.1l: Total N 2O Emissions by Fuel Type for the DOE Plan for the Low
(tonne)
2003 - 559 313 79 952
2004 - 543 376 95 1,013
2005 - 599 402 121 1,122
2006 - 740 428 108 1,275
2007 - 827 456 142 1,424
2008 - 916 471 202 1,589
2009 - 997 476 305 1,778
2010 - 1,175 474 320 1,969
2011 - 1,399 469 308 2,176
2012 - 1,589 471 328 2,389
Total for period - 9,342 4,336 2,008 15,686
Table C.1m: Total Particulate Emissions by Fuel Type for the DOE Plan for the
Low Economic Growth Scenario
(tonne)
2003 - 16,394 836 2,698 19,927
2004 - 15,917 1,003 3,221 20,140
2005 - 17,559 1,073 3,528 22,160
2006 - 21,700 1,140 3,139 25,979
2007 - 24,244 1,216 4,514 29,973
2008 - 26,858 1,257 5,836 33,952
2009 - 29,256 1,268 7,684 38,209
2010 - 34,466 1,264 7,923 43,653
2011 - 41,031 1,250 7,072 49,353
2012 - 46,620 1,256 7,771 55,647
Total for period - 274,044 11,563 53,387 338,995
Table C.1n: Environmental Emissions per Unit Generation

(tonne/kWh)
Year
CO2 SOX NOX CO CH4 NMVOC N2O Particulates
2003 340.55 2.89 2.04 0.39 0.01 0.03 0.02 0.36
2004 338.78 2.69 1.97 0.39 0.01 0.03 0.02 0.34
2005 346.66 2.84 2.01 0.41 0.01 0.03 0.02 0.35
2006 358.39 3.06 2.14 0.42 0.01 0.03 0.02 0.37
2007 373.36 3.24 2.25 0.43 0.01 0.03 0.02 0.40
2008 390.39 3.52 2.35 0.46 0.01 0.03 0.02 0.42
2009 410.97 3.89 2.45 0.49 0.01 0.03 0.02 0.44
2010 421.66 4.15 2.57 0.50 0.01 0.03 0.02 0.47
2011 429.37 4.41 2.67 0.50 0.01 0.03 0.02 0.50
2012 438.50 4.60 2.78 0.51 0.01 0.03 0.02 0.52

UPEEE Foundation
Table C.2a: DOE Plan for Power Generation for the High Economic Growth
Scenario
(GWh)
Year
Type
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-Based 2865 3614 3484 3899 6367 6225 5758 3494 3009 4246
Fuel Oil 2465 3018 2956 3725 6021 6074 5555 3339 2944 4088
Diesel 400 596 528 175 345 151 203 155 64 157
Coal 18893 18850 21243 26016 27836 29335 30518 29734 28946 30604
Local 3082 1363 2323 2507 2923 3158 3372 3242 3042 3338
Imported 15811 17487 18920 23509 24912 26177 27146 26492 25904 27267
Natural Gas 13349 16084 17439 18578 19791 20221 20260 20192 19965 20122
Hydro 6324 6893 7932 7952 8020 8027 8073 8069 8043 8093
Geothermal 14126 15000 15076 15101 15104 15104 15101 15104 15105 15106
Wind 0 153 153 153 153 153 153 153 153 152
Others 0 0 937 952 1883 6743 13254 24128 34095 40147
Baseload 0 0 0 0 1142 3435 5158 13769 22932 24783
Midrange 0 0 937 952 741 3308 8062 10345 11154 15028
Peaking 0 0 0 0 0 0 33 14 10 336
TOTAL 55556 60595 66263 72650 79153 85807 93115 100874 109316 118470
Table C.2b: System Peak Demand Forecasts for the High Economic Growth
Scenario
(MW)
NATIONAL
YEAR LUZON VISAYAS MINDANAO
Non-Coincident Peak
2003 6,788 1,014 1,081 8,883

2004 7,357 1,099 1,176 9,633
2005 7,994 1,194 1,281 10,469
2006 8,711 1,313 1,400 11,424
2007 9,438 1,428 1,512 12,378
2008 10,186 1,543 1,630 13,359
2009 10,992 1,675 1,757 14,423
2010 11,862 1,809 1,891 15,562
2011 12,804 1,953 2,034 16,790
2012 13,815 2,106 2,186 18,106
Annual Ave. G.R.

(2003 - 2007) 8.59% 8.94% 8.73% 8.65%
(2008 - 2012) 7.92% 8.09% 7.60% 7.90%
(2003 - 2012) 8.22% 8.46% 8.13% 8.23%

UPEEE Foundation
Table C.2c: Electricity Sales Forecasts for the High Economic Growth Scenario
(GWh)
YEAR
2003 39,814 5,355 6,300 51,469

2004 43,156 5,807 6,851 55,814
2005 46,888 6,305 7,465 60,658
2006 51,094 6,938 8,155 66,187
2007 55,363 7,542 8,805 71,711
2008 59,746 8,149 9,497 77,392
2009 64,474 8,848 10,233 83,555
2010 69,578 9,555 11,015 90,148
2011 75,104 10,314 11,847 97,266
2012 81,033 11,124 12,732 104,888
Annual Ave. G.R.

(2003 - 2007) 8.59% 8.94% 8.73% 8.64%
(2008 - 2012) 7.92% 8.09% 7.60% 7.90%
(2003 - 2012) 8.22% 8.46% 8.13% 8.23%

UPEEE Foundation
Table C.2d: DOE Plan for Installed Capacity for the High Economic Growth
Scenario
(MW)
Fuel Type Year

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-based 2,443 2,443 2,443 2,443 2,443 2,443 2,233 1,583 1,583 1,583
Coal 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758
Local 450 450 450 450 450 450 450 450 450 450
Imported 3,308 3,308 3,308 3,308 3,308 3,308 3,308 3,308 3,308 3,308
Natural Gas 2,763 2,763 2,763 2,763 2,763 2,763 2,763 2,763 2,763 2,763
Hydro 1,510 1,860 2,205 2,205 2,205 2,205 2,205 2,205 2,205 2,205
Geothermal 907 907 907 907 907 907 907 907 907 907
Luzon
NRE
Wind - 65 65 65 65 65 65 65 65 65
Others
Baseload - - - - - - - 900 1,800 1,800
Intermediate - - - - - 300 1,500 2,700 3,300 3,300
Peaking - - - - - - - - - 750
LUZON TOTAL 11,381 11,796 12,141 12,141 12,141 12,441 13,431 14,881 16,381 17,131
Oil-based 468 431 281 281 281 281 281 281 182 182
Coal 205 205 205 205 205 205 205 205 205 205
Local 150 150 150 150 150 150 150 150 150 150
Imported 55 55 55 55 55 55 55 55 55 55
Natural Gas - - - - - - - - - -
Hydro 12 12 12 12 12 12 12 12 12 12
Visayas
Geothermal 919 959 959 959 959 959 959 959 959 959
NRE
Wind - - - - - - - - - -
Others
Baseload - - - - 100 200 400 550 650 750
Intermediate - - 200 250 300 350 500 550 650 650
Peaking - - - - - - - - - -
VISAYAS TOTAL 1,604 1,607 1,657 1,707 1,857 2,007 2,357 2,557 2,658 2,758
Oil-based 546 616 616 616 616 616 616 616 616 616
Coal - - - 200 200 200 200 200 200 200
Local - - - - - - - - - -
Imported - - - 200 200 200 200 200 200 200
Natural Gas - - - - - - - - - -
Hydro 997 997 997 997 997 997 997 997 997 997
Mindanao
Geothermal 104 104 104 104 104 104 104 104 104 104
NRE
Wind - - - - - - - - - -
Others
Baseload - - - - 50 250 300 400 550 650
Intermediate - - 100 100 100 150 150 250 300 300
Peaking - - - - - - - - - -
MINDANAO TOTAL 1,647 1,717 1,817 2,017 2,067 2,317 2,367 2,567 2,767 2,867

UPEEE Foundation
Fuel Type Year

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-based 3,457 3,490 3,340 3,340 3,340 3,340 3,130 2,480 2,381 2,381
Coal 3,963 3,963 3,963 4,163 4,163 4,163 4,163 4,163 4,163 4,163
Local 600 600 600 600 600 600 600 600 600 600
Imported 3,363 3,363 3,363 3,563 3,563 3,563 3,563 3,563 3,563 3,563
Natural Gas 2,763 2,763 2,763 2,763 2,763 2,763 2,763 2,763 2,763 2,763
Hydro 2,519 2,869 3,214 3,214 3,214 3,214 3,214 3,214 3,214 3,214
Philippines
Geothermal 1,930 1,970 1,970 1,970 1,970 1,970 1,970 1,970 1,970 1,970
NRE
Wind - 65 65 65 65 65 65 65 65 65
Others
Baseload - - - - 150 450 700 1,850 3,000 3,200
Intermediate - - 300 350 400 800 2,150 3,500 4,250 4,250

Peaking - - - - - - 0 0 0 750

UPEEE Foundation
Table C.2e: DOE Plan for Power Plant Line-Up for the High Economic Growth
Scenario
LUZON VISAYAS MINDANAO PHILIPPINES
YEAR
MW installed MW installed MW installed
PLANT ADDITION PLANT ADDITION PLANT ADDITION cumulative total
capacity MW capacity MW capacity MW
Kalayaan 3&4 350 345 Uprating of Leyte- 40 0 385

Bohol
Interconnection
from 35 MW to 100
MW
PNOC_EDC Wind 40 from 35 MW to 100
2004 MW
Transfer of -70 Mambucal Geo 40
Hopewell GT to
Mindanao (70
MW)
Northwind 25
San Roque Hydro 345 690 Uprating of Leyte- 240 Hopewell GT from 70 170 1,100
Cebu Luzon
Interconnection
from 200 MW to
2005 400 MW
Panay Midrange 150 Midrange Plant 100
Negros Midrange 50
2006 690 Panay Midrange 50 290 Mindanao Coal 200 370 1,350
690 Panay Baseload 100 440 Baseload Plant 50 420 1,550

2007
Panay Midrange 50
Midrange 300 990 Cebu Baseload 50 590 Baseload Plant 200 670 2,250
2008 Cebu Midrange 50 Midrange Plant 50
Negros Baseload 50
Midrange 1,200 2,190 Cebu Baseload 100 940 Baseload Plant 50 720 3,850
Panay Baseload 50
2009 Negros Baseload 50
Cebu Midrange 50
Bohol Midrange 100
Baseload Plant 900 4,290 Cebu Baseload 150 1,140 Baseload Plant 100 870 6,300
2010 Midrange 1,200 Bohol Midrange 50 Midrange Plant 50
Baseload Plant 900 5,790 Cebu Baseload 50 1,340 Baseload Plant 150 1,070 8,200
2011 Midrange 600 Negros Baseload 50 Midrange Plant 50
Cebu Midrange 100
Peaking 750 6,540 Cebu Baseload 50 1,440 Baseload Plant 100 1,170 9,150
2012
Panay Baseload 50

UPEEE Foundation
Table C.2f: Total CO2 Emissions by Fuel Type for the DOE Plan for the High
(tonne)
2003 641,320 10,258,239 5,897,849 2,253,435 19,050,843
2004 681,000 10,234,891 7,106,226 2,840,055 20,862,172
2005 684,450 11,534,207 7,704,891 2,863,793 22,787,341
2006 685,585 14,125,779 8,208,124 3,877,529 26,897,017
2007 685,722 15,734,042 8,744,051 5,664,859 30,828,673
2008 685,722 17,792,965 8,934,033 7,785,862 35,198,582
2009 685,585 19,370,822 8,951,264 11,565,124 40,572,796
2010 685,722 23,620,609 8,921,220 11,743,322 44,970,873
2011 685,767 28,167,941 8,820,927 12,060,537 49,735,173
2012 685,812 30,073,206 8,890,293 16,645,518 56,294,829
Total for period 6,806,686 180,912,701 82,178,879 77,300,035 347,198,300
Table C.2g: Total SOx Emissions by Fuel Type for the DOE Plan for the High
(tonne)
2003 - 139,808 104 27,299 167,211
2004 - 139,490 126 33,639 173,254
2005 - 157,198 136 34,473 191,808
2006 - 192,518 145 51,202 243,866
2007 - 214,437 155 74,094 288,686
2008 - 242,498 158 104,396 347,052
2009 - 264,002 159 154,784 418,945
2010 - 321,922 158 157,630 479,710
2011 - 383,897 156 162,688 546,741
2012 - 409,864 157 221,296 631,317
Total for period - 2,465,636 1,456 1,021,499 3,488,590
Table C.2h: Total NOx Emissions by Fuel Type for the DOE Plan for the High
(tonne)
2003 - 79,351 21,939 9,774 111,064
2004 - 79,170 26,434 12,895 118,498
2005 - 89,221 28,661 12,824 130,706
2006 - 109,267 30,533 13,877 153,677
2007 - 121,708 32,526 20,653 174,887
2008 - 137,634 33,233 27,043 197,909
2009 - 149,839 33,297 41,180 224,316
2010 - 182,713 33,185 42,014 257,912
2011 - 217,888 32,812 42,683 293,383
2012 - 232,625 33,070 61,250 326,945
Total for period - 1,399,415 305,689 284,194 1,989,297

UPEEE Foundation
Table C.2i: Total CO Emissions by Fuel Type for the DOE Plan for the High
(tonne)
2003 - 10,013 8,776 2,962 21,751
2004 - 9,991 10,573 3,719 24,283
2005 - 11,259 11,464 4,122 26,845
2006 - 13,788 12,213 5,529 31,530
2007 - 15,358 13,010 7,831 36,199
2008 - 17,368 13,293 11,691 42,352
2009 - 18,908 13,319 18,574 50,801
2010 - 23,057 13,274 19,701 56,032
2011 - 27,495 13,125 20,452 61,072
2012 - 29,355 13,228 28,027 70,610
Total for period - 176,593 122,275 122,608 421,476
Table C.2j: Total CH4 Emissions by Fuel Type for the DOE Plan for the High
(tonne)
2003 - 105 145 33 283
2004 - 105 175 42 321
2005 - 118 190 43 351
2006 - 145 202 55 402
2007 - 161 215 80 456
2008 - 182 220 112 514
2009 - 198 220 171 589
2010 - 242 219 176 638
2011 - 288 217 182 687
2012 - 308 219 252 778
Total for period - 1,851 2,022 1,145 5,018
Table C.2k: Total NMVOC Emissions by Fuel Type for the DOE Plan for the
High Economic Growth Scenario
(tonne)
2003 - 378 1,045 177 1,599
2004 - 377 1,259 222 1,858
2005 - 425 1,365 250 2,039
2006 - 520 1,454 332 2,306
2007 - 580 1,549 468 2,596
2008 - 655 1,583 707 2,945
2009 - 714 1,586 1,136 3,435
2010 - 870 1,580 1,212 3,662
2011 - 1,038 1,562 1,260 3,860
2012 - 1,108 1,575 1,726 4,409
Total for period - 6,664 14,557 7,489 28,710

UPEEE Foundation
Table C.2l: Total N 2O Emissions by Fuel Type for the DOE Plan for the High
(tonne)
2003 - 567 313 90 970
2004 - 566 378 112 1,055
2005 - 637 409 114 1,160
2006 - 780 436 159 1,376
2007 - 869 465 232 1,566
2008 - 983 475 322 1,779
2009 - 1,070 476 478 2,024
2010 - 1,305 474 486 2,265
2011 - 1,556 469 500 2,525
2012 - 1,662 472 686 2,820
Total for period - 9,996 4,367 3,176 17,539
Table C.2m: Total Particulate Emissions by Fuel Type for the DOE Plan for the
High Economic Growth Scenario
(tonne)
2003 - 16,626 836 2,215 19,677
2004 - 16,588 1,007 2,898 20,493
2005 - 18,694 1,092 2,688 22,474
2006 - 22,894 1,163 3,074 27,131
2007 - 25,501 1,239 4,691 31,430
2008 - 28,838 1,266 5,709 35,813
2009 - 31,395 1,268 7,991 40,655
2010 - 38,283 1,264 7,688 47,235
2011 - 45,653 1,250 7,697 54,599
2012 - 48,741 1,260 11,131 61,132
Total for period - 293,211 11,645 55,783 360,639
Table C.1n: Environmental Emissions per Unit Generation

(tonne/kWh)
Year
CO2 SOX NOX CO CH4 NMVOC N2O Particulates
2003 370.14 3.25 2.16 0.42 0.01 0.03 0.02 0.38
2004 373.78 3.10 2.12 0.44 0.01 0.03 0.02 0.37
2005 375.67 3.16 2.15 0.44 0.01 0.03 0.02 0.37
2006 406.38 3.68 2.32 0.48 0.01 0.03 0.02 0.41
2007 429.91 4.03 2.44 0.50 0.01 0.04 0.02 0.44
2008 454.81 4.48 2.56 0.55 0.01 0.04 0.02 0.46
2009 485.58 5.01 2.68 0.61 0.01 0.04 0.02 0.49
2010 498.86 5.32 2.86 0.62 0.01 0.04 0.03 0.52
2011 511.34 5.62 3.02 0.63 0.01 0.04 0.03 0.56
2012 536.71 6.02 3.12 0.67 0.01 0.04 0.03 0.58

UPEEE Foundation
Appendix D
Clean Power Development Options
2003-2012
Appendix D POWER SWITCH!
APPENDIX D.1
LOW ECONOMIC GROWTH
SCENARIO-
MODERATE CLEAN POWER
DEVELOPMENT OPTION
(LEGS-MCPD)

UPEEE Foundation
Table D.1a: Installed Capacity

(MW)
Year
Fuel Type
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-based 2,491 2,491 2,491 2,491 2,491 1,871 1,661 1,011 1,011 1,011
Coal 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758
Natural Gas 2,763 2,763 2,763 2,763 2,763 3,583 4,383 5,283 5,583 5,983
Luzon
Geothermal 907 907 907 907 907 947 977 1,227 1,267 1,287
Hydro 1,510 1,860 2,205 2,205 2,205 2,404 2,404 2,422 2,797 3,211
Biomass - - - - - - - - - -
Wind - 25 25 65 65 130 235 400 525 650
LUZON TOTAL 11,429 11,804 12,149 12,189 12,189 12,694 13,419 14,101 14,941 15,901
Oil-based 545 509 559 559 609 609 609 629 605 655
Coal 205 205 205 205 205 205 205 205 205 205
Natural Gas - - - - - - - - - -
Visayas
Geothermal 916 956 956 956 956 986 1,066 1,116 1,216 1,266
Hydro 12 12 12 12 12 12 12 37 63 73
Biomass - - - 50 80 80 80 100 100 100
Wind - - - - - 20 40 60 80 100
VISAYAS TOTAL 1,678 1,682 1,732 1,782 1,862 1,912 2,012 2,146 2,269 2,398
Oil-based 547 547 647 647 647 647 647 647 647 647
Coal - - - 200 250 250 250 250 250 250
Natural Gas - - - - - - - - - -
Mindanao
Geothermal 108 108 108 108 108 128 148 188 228 228
Hydro 997 997 997 997 997 1,255 1,415 1,467 1,558 1,658
Biomass - - - - - 12 12 12 12 12
Wind - - - - - 20 40 60 80 100
MINDANAO TOTAL 1,652 1,652 1,752 1,952 2,002 2,312 2,512 2,624 2,775 2,895
Oil-based 3,583 3,547 3,697 3,697 3,747 3,127 2,917 2,287 2,263 2,313
Coal 3,963 3,963 3,963 4,163 4,213 4,213 4,213 4,213 4,213 4,213
Philippines
Natural Gas 2,763 2,763 2,763 2,763 2,763 3,583 4,383 5,283 5,583 5,983
Geothermal 1,931 1,971 1,971 1,971 1,971 2,061 2,191 2,531 2,711 2,781
Hydro 2,519 2,869 3,214 3,214 3,214 3,671 3,831 3,925 4,418 4,942
Biomass - - - 50 80 92 92 112 112 112
Wind - 25 25 65 65 170 315 520 685 850

UPEEE Foundation
Table D.1b: Annual Capacity Additions

(MW)
Fuel Type
Year
Oil-based Coal Natural Gas Geothermal Hydro Biomass Wind Total Addition
Current Installed 3,583 3,963 2,763 1,931 2,519 0 0
2003 0 0 0 0 0 0 0 0
2004 0 0 0 40 350 0 25 415
2005 300 0 0 0 345 0 0 645
2006 0 200 0 0 0 50 40 290
2007 50 50 0 0 0 30 0 130
2008 0 0 820 90 457 12 105 1,484
2009 0 0 800 130 160 0 145 1,235
2010 20 0 900 340 94 20 205 1,579
2011 75 0 300 180 493 0 165 1,213
2012 50 0 400 70 524 0 165 1,209
Table D.1c: Power Generation

(GWh)
Year Fuel Type

2003 2,720 18,629 13,349 14,121 6,324 0 0 55,143
2004 3,247 18,087 16,017 14,975 6,893 0 153 59,372
2005 3,952 19,953 17,141 15,054 7,928 0 153 64,181
2006 3,523 24,659 18,210 15,092 7,943 0 153 69,580
2007 4,764 27,550 19,415 15,098 7,968 0 153 74,948
2008 6,590 30,521 20,074 15,099 8,001 0 153 80,438
2009 1,596 27,906 24,943 14,085 16,343 645 843 86,360
2010 1,706 27,857 27,374 16,710 16,813 785 1,391 92,636
2011 1,652 27,589 30,060 18,100 19,271 785 1,831 99,289
2012 1,915 27,835 33,097 18,641 21,884 785 2,272 106,430
Table D.1d: Carbon Dioxide Emissions by Fuel Type

(tonne)
Fuel Type
Year
2003 2,125,011 10,114,896 5,897,849 641,093 - - - 18,778,850
2004 2,536,797 9,820,609 7,076,624 679,865 - - - 20,113,894
2005 3,158,821 10,833,782 7,573,229 683,452 - - - 22,249,284
2006 2,816,776 13,388,975 8,045,534 685,177 - - - 24,936,462
2007 3,760,465 14,958,687 8,577,927 685,449 - - - 27,982,528
2008 5,275,644 16,571,837 8,869,086 685,495 - - - 31,402,061
2009 1,089,937 15,151,783 11,020,477 639,456 - - - 27,901,654
2010 1,174,313 15,125,576 12,094,216 758,653 - - - 29,152,757
2011 1,133,148 14,979,784 13,281,263 821,757 - - - 30,215,951
2012 1,333,908 15,113,383 14,623,101 846,297 - - - 31,916,689

UPEEE Foundation
Table D.1e: Environmental Emissions

(tonne)
Year
CO2 SOX NOX CO CH 4 NMVOC N 2O Particulates
2003 18,778,850 159,289 112,712 21,362 282 1,581 952 19,927
2004 20,113,894 159,429 117,251 23,355 314 1,810 1,013 20,140
2005 22,249,284 181,988 128,937 26,241 346 2,008 1,122 22,160
2006 24,936,462 213,151 148,599 28,966 379 2,157 1,275 25,979
2007 27,982,528 243,113 168,897 32,363 423 2,373 1,424 29,973
2008 31,402,061 283,422 189,317 36,758 470 2,630 1,589 33,952
2009 27,901,654 217,840 164,380 32,442 443 2,584 775,147 27,536
2010 29,152,757 217,726 169,137 34,110 470 2,779 943,397 27,839
2011 30,215,951 215,650 171,954 35,687 497 2,981 943,451 27,677
2012 31,916,689 218,029 180,275 38,044 536 3,238 943,535 28,542
Table D.1f: Environmental Emission per Unit Generation

(tonne/GWh)
Year Environmental Emissions

CO2 SO X NOX CO CH 4 NMVOC N2O Particulates
2003 340.55 2.89 2.04 0.39 0.01 0.03 0.02 0.36
2004 338.78 2.69 1.97 0.39 0.01 0.03 0.02 0.34
2005 346.66 2.84 2.01 0.41 0.01 0.03 0.02 0.35
2006 358.39 3.06 2.14 0.42 0.01 0.03 0.02 0.37
2007 373.36 3.24 2.25 0.43 0.01 0.03 0.02 0.40
2008 390.39 3.52 2.35 0.46 0.01 0.03 0.02 0.42
2009 323.09 2.52 1.90 0.38 0.01 0.03 8.98 0.32
2010 314.70 2.35 1.83 0.37 0.01 0.03 10.18 0.30
2011 304.32 2.17 1.73 0.36 0.01 0.03 9.50 0.28
2012 299.88 2.05 1.69 0.36 0.01 0.03 8.87 0.27
Table D.1g: Generation Cost
Generation Cost
Year
US$/kWh PhP/kWh
2003 0.06 3.04
2004 0.06 3.10
2005 0.06 3.12
2006 0.06 3.05
2007 0.06 3.05
2008 0.06 3.20
2009 0.06 3.06
2010 0.06 3.10
2011 0.06 3.19
2012 0.06 3.31

UPEEE Foundation
APPENDIX D.2
LOW ECONOMIC GROWTH
SCENARIO-
AGGRESSIVE CLEAN POWER
DEVELOPMENT OPTION
(LEGS-ACPD)

UPEEE Foundation

(MW)
Fuel Type
Year
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-based 2,491 2,491 2,491 2,491 2,491 1,871 1,661 1,011 1,011 1,011
Coal 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758
Natural Gas 2,763 2,763 2,763 2,763 2,763 3,063 3,778 4,548 4,968 5,468
Luzon
Geothermal 907 907 907 907 907 947 977 1,227 1,267 1,287
Hydro 1,510 1,860 2,205 2,205 2,205 2,404 2,404 2,422 2,797 3,211
Biomass - - - - - 10 25 25 25 25
Wind - 25 25 65 65 665 1,265 1,865 2,465 3,065
LUZON TOTAL 11,429 11,804 12,149 12,189 12,189 12,718 13,868 14,856 16,291 17,825
Oil-based 545 509 559 559 609 609 609 609 510 510
Coal 205 205 205 205 205 205 205 205 205 205
Natural Gas - - - - - - - - - -
Visayas
Geothermal 916 956 956 956 956 996 1,096 1,146 1,346 1,476
Hydro 12 12 12 12 12 12 12 37 63 63
Biomass - - - 50 80 80 80 80 80 80
Wind - - - - - 20 40 60 80 80
VISAYAS TOTAL 1,678 1,682 1,732 1,782 1,862 1,922 2,042 2,136 2,283 2,413
Oil-based 547 547 647 647 647 647 647 647 647 647
Coal - - - 200 250 250 250 250 250 250
Natural Gas - - - - - - - - - -
Mindanao
Geothermal 108 108 108 108 108 128 148 188 228 228
Hydro 997 997 997 997 997 1,255 1,415 1,467 1,558 1,658
Biomass - - - - - 12 12 12 12 12
Wind - - - - - 33 106 179 262 335
MINDANAO TOTAL 1,652 1,652 1,752 1,952 2,002 2,325 2,578 2,743 2,957 3,130
Oil-based 3,583 3,547 3,697 3,697 3,747 3,127 2,917 2,267 2,168 2,168
Coal 3,963 3,963 3,963 4,163 4,213 4,213 4,213 4,213 4,213 4,213
Philippines
Natural Gas 2,763 2,763 2,763 2,763 2,763 3,063 3,778 4,548 4,968 5,468
Geothermal 1,931 1,971 1,971 1,971 1,971 2,071 2,221 2,561 2,841 2,991
Hydro 2,519 2,869 3,214 3,214 3,214 3,671 3,831 3,925 4,418 4,932
Biomass - - - 50 80 102 117 117 117 117
Wind - 25 25 65 65 718 1,411 2,104 2,807 3,480

UPEEE Foundation

(MW)
Fuel Type
Year
Oil-based* Coal Natural Gas Geothermal Hydro Biomass Wind Total Addition
Currently Installed 3,583 3,963 2,763 1,931 2,519 0 0
2003 0 0 0 0 0 0 0 0
2004 0 0 0 40 350 0 25 415
2005 300 0 0 0 345 0 0 645
2006 0 200 0 0 0 50 40 290
2007 50 50 0 0 0 30 0 130
2008 548 0 300 100 457 22 653 2,079
2009 548 0 715 150 160 15 693 2,281
2010 488 0 770 340 94 0 693 2,385
2011 538 0 420 280 492 0 703 2,433
2012 528 0 500 150 514 0 673 2,365
*includes capacities of diesel engines used as ancillary to wind power plants

(GWh)
Fuel Type
Year
2003 2,720 18,629 13,349 14,121 6,324 0 0 55,143
2004 3,247 18,087 16,017 14,975 6,893 0 153 59,372
2005 3,952 19,953 17,141 15,054 7,928 0 153 64,181
2006 3,523 24,659 18,210 15,092 7,943 0 153 69,580
2007 4,764 27,550 19,415 15,098 7,968 0 153 74,948
2008 4,385 26,375 18,341 13,158 15,545 715 1,919 80,437
2009 3,654 24,746 22,708 14,317 16,345 820 3,770 86,360
2010 1,704 23,534 27,198 16,942 16,815 820 5,622 92,636
2011 1,651 21,655 29,885 19,104 19,270 436 7,287 99,289
2012 1,915 20,245 32,922 20,263 21,741 259 9,085 106,430

(tonne)
Fuel Type
Year
2003 2,125,011 10,114,896 5,897,849 641,093 - - - 18,778,850
2004 2,536,797 9,820,609 7,076,624 679,865 - - - 20,113,894
2005 3,158,821 10,833,782 7,573,229 683,452 - - - 22,249,284
2006 2,816,776 13,388,975 8,045,534 685,177 - - - 24,936,462
2007 3,760,465 14,958,687 8,577,927 685,449 - - - 27,982,528
2008 3,157,136 14,320,647 8,103,361 597,386 - - - 26,178,529
2009 2,557,709 13,436,477 10,032,732 649,973 - - - 26,676,891
2010 1,172,790 12,778,369 12,016,809 769,170 - - - 26,737,138
2011 1,132,387 11,758,117 13,203,856 867,332 - - - 26,961,692
2012 1,333,908 10,992,082 14,545,694 919,919 - - - 27,791,602

UPEEE Foundation

(tonne)
Year
2003 18,778,850 159,289 112,712 21,362 282 1,581 952 19,927
2004 20,113,894 159,429 117,251 23,355 314 1,810 1,013 20,140
2005 22,249,284 181,988 128,937 26,241 346 2,008 1,122 22,160
2006 24,936,462 213,151 148,599 28,966 379 2,157 1,275 25,979
2007 27,982,528 243,113 168,897 32,363 423 2,373 1,424 29,973
2008 26,178,529 232,065 155,223 29,376 389 2,154 859,125 28,010
2009 26,676,891 214,539 151,546 30,475 418 2,407 985,301 26,086
2010 26,737,138 185,731 150,675 31,702 444 2,679 985,311 24,020
2011 26,961,692 171,739 146,737 32,426 462 2,849 525,150 22,442
2012 27,791,602 161,859 148,107 33,906 492 3,073 312,583 21,852

(tonne/GWh)

2003 340.55 2.89 2.04 0.39 0.01 0.03 0.02 0.36
2004 338.78 2.69 1.97 0.39 0.01 0.03 0.02 0.34
2005 346.66 2.84 2.01 0.41 0.01 0.03 0.02 0.35
2006 358.39 3.06 2.14 0.42 0.01 0.03 0.02 0.37
2007 373.36 3.24 2.25 0.43 0.01 0.03 0.02 0.40
2008 325.45 2.89 1.93 0.37 0.00 0.03 10.68 0.35
2009 308.90 2.48 1.75 0.35 0.00 0.03 11.41 0.30
2010 288.63 2.00 1.63 0.34 0.00 0.03 10.64 0.26
2011 271.54 1.73 1.48 0.33 0.00 0.03 5.29 0.23
2012 261.13 1.52 1.39 0.32 0.00 0.03 2.94 0.21
Generation Cost
Year
US$/kWh PhP/kWh
2003 0.06 3.04
2004 0.06 3.10
2005 0.06 3.12
2006 0.06 3.05
2007 0.06 3.05
2008 0.05 3.01
2009 0.06 3.15
2010 0.06 3.23
2011 0.06 3.38
2012 0.06 3.54

UPEEE Foundation
APPENDIX D.3
HIGH ECONOMIC GROWTH
SCENARIO-
MODERATE CLEAN POWER
DEVELOPMENT OPTION
(HEGS-MCPD)

UPEEE Foundation

(MW)
Fuel Type
Year
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-based 2,491 2,491 2,491 2,491 2,491 1,871 1,661 1,011 1,011 1,011
Coal 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758
Natural Gas 2,763 2,763 2,763 2,763 2,763 3,583 4,733 6,433 7,183 7,383
Luzon
Geothermal 907 907 907 907 907 947 977 1,227 1,267 1,287
Hydro 1,510 1,860 2,205 2,205 2,205 2,404 2,404 2,422 2,797 3,211
Biomass - - - - - - - - - -
Wind - 25 25 65 65 130 275 440 565 690
LUZON TOTAL 11,429 11,804 12,149 12,189 12,189 12,694 13,809 15,291 16,581 17,341
Oil-based 545 509 559 609 609 609 609 629 605 655
Coal 205 205 205 205 205 205 205 205 205 205
Natural Gas - - - - - - - - - -
Visayas
Geothermal 916 956 956 956 956 996 1,176 1,276 1,476 1,526
Hydro 12 12 12 12 12 12 12 37 63 73
Biomass - - - 50 80 80 80 100 100 100
Wind - - - - - 20 40 65 85 105
VISAYAS TOTAL 1,678 1,682 1,732 1,832 1,862 1,922 2,122 2,311 2,534 2,663
Oil-based 547 547 717 717 717 717 717 717 717 717
Coal - - - 200 200 200 200 200 200 200
Natural Gas - - - - - - - - - -
Mindanao
Geothermal 108 108 108 108 108 128 148 188 228 228
Hydro 997 997 997 997 997 1,367 1,467 1,658 1,658 1,687
Biomass - - - - - - - - - -
Wind - - - - - - 49 69 89 109
MINDANAO TOTAL 1,652 1,652 1,822 2,022 2,022 2,412 2,581 2,832 2,892 2,941
Oil-based 3,583 3,547 3,767 3,817 3,817 3,197 2,987 2,357 2,333 2,383
Coal 3,963 3,963 3,963 4,163 4,163 4,163 4,163 4,163 4,163 4,163
Philippines
Natural Gas 2,763 2,763 2,763 2,763 2,763 3,583 4,733 6,433 7,183 7,383
Geothermal 1,931 1,971 1,971 1,971 1,971 2,071 2,301 2,691 2,971 3,041
Hydro 2,519 2,869 3,214 3,214 3,214 3,783 3,883 4,116 4,518 4,971
Biomass - - - 50 80 80 80 100 100 100
Wind - 25 25 65 65 150 364 574 739 904

UPEEE Foundation

(MW)
Year Fuel Type

Oil-based Coal Natural Gas Geothermal Hydro Biomass Wind Total Addition
Currently Installed 3,583 3,963 2,763 1,931 2,519 0 0 14,759
2003 0 0 0 0 0 0 0 0
2004 0 0 0 40 350 0 25 415
2005 370 0 0 0 345 0 0 715
2006 50 200 0 0 0 50 40 340
2007 0 0 0 0 0 30 0 30
2008 0 0 820 100 569 0 85 1,574
2009 0 0 1,150 230 100 0 214 1,694
2010 20 0 1,700 390 233 20 210 2,573
2011 75 0 750 280 402 0 165 1,672
2012 50 0 200 70 453 0 165 938

(GWh)
Fuel Type
Year
2003 2,864 18,893 13,349 14,126 6,324 0 0 55,556
2004 3,615 18,850 16,084 15,000 6,893 0 153 60,595
2005 4,420 21,243 17,439 15,076 7,932 0 153 66,263
2006 4,850 26,016 18,578 15,101 7,952 0 153 72,650
2007 7,107 28,978 19,791 15,104 8,020 0 153 79,153
2008 4,463 27,973 23,146 13,158 16,103 561 402 85,807
2009 2,646 27,479 29,919 14,934 16,602 561 974 93,115
2010 2,252 27,209 33,465 17,946 17,766 701 1,535 100,874
2011 2,879 26,964 37,503 20,108 19,769 343 1,749 109,315
2012 3,747 26,964 42,065 20,649 22,028 701 2,317 118,471

(tonne)
Fuel Type
Year
2003 2,252,722 10,258,239 5,897,849 641,320 - - - 19,050,130
2004 2,840,768 10,234,891 7,106,226 681,000 - - - 20,862,885
2005 3,484,190 11,534,207 7,704,891 684,450 - - - 23,407,739
2006 3,897,496 14,125,779 8,208,124 685,585 - - - 26,916,984
2007 5,664,859 15,734,042 8,744,051 685,722 - - - 30,828,673
2008 3,128,877 15,188,496 10,226,404 597,386 - - - 29,141,163
2009 1,855,858 14,920,208 13,218,671 678,019 - - - 30,672,756
2010 1,555,110 14,773,321 14,785,600 814,745 - - - 31,928,777
2011 2,033,367 14,640,458 16,569,537 912,907 - - - 34,156,269
2012 2,695,991 14,640,458 18,585,272 937,448 - - - 36,859,169

UPEEE Foundation

(tonne)
Year
CO2 S OX NOX CO CH 4 NMVOC N 2O Particulates
2003 19,050,130 167,202 111,062 21,750 283 1,599 970 19,676
2004 20,862,885 173,264 118,500 24,284 321 1,858 1,055 20,494
2005 23,407,739 200,294 132,447 27,343 358 2,065 1,186 23,096
2006 26,916,984 244,139 153,733 31,546 402 2,307 1,377 27,151
2007 30,828,673 288,686 174,887 36,199 456 2,596 1,566 31,430
2008 29,141,163 239,636 173,734 33,304 453 2,559 674,268 43,677
2009 30,672,756 217,873 179,755 36,428 509 3,024 674,359 42,506
2010 31,928,777 215,099 181,266 38,272 540 3,274 842,617 45,166
2011 34,156,269 214,591 191,684 41,344 592 3,620 413,372 37,711
2012 36,859,169 216,389 207,421 45,101 655 4,024 842,845 48,099

(tonne/GWh)

2003 370.13 3.25 2.16 0.42 0.01 0.03 0.02 0.38
2004 373.79 3.10 2.12 0.44 0.01 0.03 0.02 0.37
2005 385.90 3.30 2.18 0.45 0.01 0.03 0.02 0.38
2006 406.68 3.69 2.32 0.48 0.01 0.03 0.02 0.41
2007 429.91 4.03 2.44 0.50 0.01 0.04 0.02 0.44
2008 376.54 3.10 2.24 0.43 0.01 0.03 8.71 0.56
2009 367.10 2.61 2.15 0.44 0.01 0.04 8.07 0.51
2010 354.18 2.39 2.01 0.42 0.01 0.04 9.35 0.50
2011 351.17 2.21 1.97 0.43 0.01 0.04 4.25 0.39
2012 351.41 2.06 1.98 0.43 0.01 0.04 8.04 0.46
Generation Cost
Year
US$/kWh PhP/kWh
2003 0.0549 3.0175
2004 0.0554 3.0495
2005 0.0555 3.0536
2006 0.0544 2.9923
2007 0.0542 2.9785
2008 0.0541 2.9744
2009 0.0561 3.0868
2010 0.0578 3.1790
2011 0.0603 3.3138
2012 0.0622 3.4193

UPEEE Foundation
APPENDIX D.4
HIGH ECONOMIC GROWTH
SCENARIO-
AGGRESSIVE CLEAN POWER
DEVELOPMENT OPTION
(HEGS-ACPD)

UPEEE Foundation

(MW)
Year
Fuel Type
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Oil-based 2,491 2,491 2,491 2,491 2,491 1,871 1,661 1,011 1,011 1,011
Coal 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758 3,758
Natural Gas 2,763 2,763 2,763 2,763 2,763 3,063 3,783 4,983 5,333 5,333
Luzon
Geothermal 907 907 907 907 907 947 977 1,227 1,267 1,287
Hydro 1,510 1,860 2,205 2,205 2,205 2,404 2,404 2,422 2,797 3,211
Biomass - - - - - 15 15 25 25 25
Wind - 25 25 65 65 665 1,265 1,865 2,465 3,065
LUZON TOTAL 11,429 11,804 12,149 12,189 12,189 12,723 13,863 15,291 16,656 17,690
Oil-based 545 509 559 609 609 609 609 609 510 510
Coal 205 205 205 205 205 205 205 205 205 205
Natural Gas - - - - - - - - - -
Visayas
Geothermal 916 956 956 956 956 996 1,096 1,146 1,346 1,476
Hydro 12 12 12 12 12 22 22 47 73 73
Biomass - - - 50 80 80 80 100 100 100
Wind - - - - - 30 110 230 314 314
VISAYAS TOTAL 1,678 1,682 1,732 1,832 1,862 1,942 2,122 2,336 2,548 2,678
Oil-based 547 547 717 717 717 717 717 717 717 717
Coal - - - 200 200 200 200 200 200 200
Natural Gas - - - - - - - - - -
Mindanao
Geothermal 108 108 108 108 108 128 148 188 228 228
Hydro 997 997 997 997 997 1,339 1,540 1,687 1,687 1,687
Biomass - - - - - - - - - 12
Wind - - - - - 76 152 186 262 336
MINDANAO TOTAL 1,652 1,652 1,822 2,022 2,022 2,460 2,757 2,978 3,094 3,180
Oil-based 3,583 3,547 3,767 3,817 3,817 3,197 2,987 2,337 2,238 2,238
Coal 3,963 3,963 3,963 4,163 4,163 4,163 4,163 4,163 4,163 4,163
Philippines
Natural Gas 2,763 2,763 2,763 2,763 2,763 3,063 3,783 4,983 5,333 5,333
Geothermal 1,931 1,971 1,971 1,971 1,971 2,071 2,221 2,561 2,841 2,991
Hydro 2,519 2,869 3,214 3,214 3,214 3,765 3,966 4,155 4,557 4,971
Biomass - - - 50 80 95 95 125 125 137
Wind - 25 25 65 65 771 1,527 2,281 3,041 3,715

UPEEE Foundation

(MW)
Fuel Type
Year
Oil-based* Coal Natural Gas Geothermal Hydro Biomass Wind Total Addition
Currently Installed 3,583 3,963 2,763 1,931 2,519 0 0
2003 0 0 0 0 0 0 0 0
2004 0 0 0 40 350 0 25 415
2005 370 0 0 0 345 0 0 715
2006 50 200 0 0 0 50 40 340
2007 0 0 0 0 0 30 0 30
2008 621 0 300 100 551 15 706 2,292
2009 582 0 720 150 201 0 756 2,409
2010 549 0 1,200 340 189 30 754 3,062
2011 595 0 350 280 402 0 760 2,387
2012 529 0 0 150 414 12 674 1,779
*includes capacities of diesel engines used as ancillary to wind power plants

(GWh)
Fuel Type
Year
2003 2,864 18,893 13,349 14,126 6,324 0 0 55,556
2004 3,615 18,850 16,084 15,000 6,893 0 153 60,595
2005 4,420 21,243 17,439 15,076 7,932 0 153 66,263
2006 4,850 26,016 18,578 15,101 7,952 0 153 72,650
2007 7,107 28,978 19,791 15,104 8,020 0 153 79,153
2008 6,549 26,315 21,045 13,158 16,014 666 2,060 85,807
2009 6,186 24,760 26,091 14,317 17,016 666 4,080 93,115
2010 2,471 23,239 33,290 16,942 17,960 876 6,095 100,874
2011 3,109 21,426 36,953 19,104 19,963 876 7,883 109,315
2012 8,600 20,012 36,953 20,263 22,030 960 9,653 118,471

(tonne)
Fuel Type
Year
2003 2,252,722 10,258,239 5,897,849 641,320 - - - 19,050,130
2004 2,840,768 10,234,891 7,106,226 681,000 - - - 20,862,885
2005 3,484,190 11,534,207 7,704,891 684,450 - - - 23,407,739
2006 3,897,496 14,125,779 8,208,124 685,585 - - - 26,916,984
2007 5,664,859 15,734,042 8,744,051 685,722 - - - 30,828,673
2008 4,630,538 14,288,115 9,298,103 597,386 - - - 28,814,142
2009 4,335,382 13,443,735 11,527,419 649,973 - - - 29,956,508
2010 1,650,538 12,618,216 14,708,193 769,170 - - - 29,746,118
2011 2,209,193 11,633,479 16,326,639 867,332 - - - 31,036,644
2012 6,398,867 10,865,993 16,326,639 919,919 - - - 34,511,418

UPEEE Foundation

(tonne)
Year
2003 19,050,130 167,202 111,062 21,750 283 1,599 970 19,676
2004 20,862,885 173,264 118,500 24,284 321 1,858 1,055 20,494
2005 23,407,739 200,294 132,447 27,343 358 2,065 1,186 23,096
2006 26,916,984 244,139 153,733 31,546 402 2,307 1,377 27,151
2007 30,828,673 288,686 174,887 36,199 456 2,596 1,566 31,430
2008 28,814,142 246,720 168,625 32,258 439 2,425 800,374 46,263
2009 29,956,508 234,679 166,882 34,465 479 2,771 800,438 44,485
2010 29,746,118 188,212 164,106 36,294 517 3,196 1,052,740 45,738
2011 31,036,644 174,073 170,515 38,248 559 3,479 1,052,785 45,997
2012 34,511,418 174,754 212,654 42,291 634 3,750 1,153,777 56,355

(tonne/GWh)

2003 370.13 3.25 2.16 0.42 0.01 0.03 0.02 0.38
2004 373.79 3.10 2.12 0.44 0.01 0.03 0.02 0.37
2005 385.90 3.30 2.18 0.45 0.01 0.03 0.02 0.38
2006 406.68 3.69 2.32 0.48 0.01 0.03 0.02 0.41
2007 429.91 4.03 2.44 0.50 0.01 0.04 0.02 0.44
2008 372.31 3.19 2.18 0.42 0.01 0.03 10.34 0.60
2009 358.52 2.81 2.00 0.41 0.01 0.03 9.58 0.53
2010 329.97 2.09 1.82 0.40 0.01 0.04 11.68 0.51
2011 319.09 1.79 1.75 0.39 0.01 0.04 10.82 0.47
2012 329.03 1.67 2.03 0.40 0.01 0.04 11.00 0.54
Generation Cost
Year
US$/kWh PhP/kWh
2003 0.0549 3.0175
2004 0.0554 3.0495
2005 0.0555 3.0536
2006 0.0544 2.9923
2007 0.0542 2.9785
2008 0.0550 3.0228
2009 0.0575 3.1607
2010 0.0593 3.2638
2011 0.0622 3.4234
2012 0.0670 3.6854

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WWF Power Switch Scenario Philippines

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POWER SWITCH!

Sc e n ar io s an d Stra teg ie s for Clean Powe r Deve lo pmen t in th e

University of the Philippines Solar Laboratory

Prepared by: With inputs from:

This report was produced by the University of the Philippines Solar

No part of this publication may be reproduced in any form or means

Kabang Kalikasan ng Pilipinas

University of the Philippines Solar Laboratory (UPSL)

1 EXECUTIVE SUMMARY .................................................................................... 1

2 ENERGY TECHNOLOGIES AND RESOURCES FOR

3 HISTORICAL PERFORMANCE OF THE

University of the Philippines Solar Laboratory page i

4 SCENARIOS UNDER THE PHILIPPINE ENERGY PLAN

5 CLEAN POWER DEVELOPMENT OPTIONS..............................................63

6 CONCLUSIONS AND RECOMMENDATIONS ............................................81

University of the Philippines Solar Laboratory page ii

Figure 2.1 Practical Wind Resources in the Philippines .....................................23

University of the Philippines Solar Laboratory page iii

Figure 4.11 Share of Renewable and Non-Renewable Energy in

University of the Philippines Solar Laboratory page iv

Table 1.1 Cost Comparison of Power Plants......................................................... 2

University of the Philippines Solar Laboratory page v

University of the Philippines Solar Laboratory page vi

Appendix A Wind and Hydro Potential in the Philippines

University of the Philippines Solar Laboratory page vii

AWPP Aggressive Wind Power Penetration

University of the Philippines Solar Laboratory page viii

SO2 sulfur dioxide

University of the Philippines Solar Laboratory page ix

This study focuses on reliability, cost and environmental performance (particularly

1.2 Technology and Resource Assessment for Clean Power Development

Clean Energy Technologies

a) Wind Energy Conversion Systems;

Improved coal technologies, such as the circulating fluidized bed combustion

University of the Philippines Solar Laboratory page 1

Cost Comparison of Power Generation Technologies

The economics of power generation technologies depends on several factors,

Table 1.1: Cost Comparison of Power Plants

Geothermal 88 0.0193 1.0602

It can be concluded that if environmental externalities will be considered, clean

Clean Indigenous Energy Resources

Energy resource assessment was conducted based on secondary data to quantify

1.3 Historical Performance of the Philippine Power Sector

University of the Philippines Solar Laboratory page 4

Energy Demand and Installed Capacity

The Philippines electricity consumption posted a moderate growth rate of 8.3%

Historical Reliability Performance

Historical Cost Performance

University of the Philippines Solar Laboratory page 5

Historical Environmental Performance

University of the Philippines Solar Laboratory page 6

1.4 Scenarios under the Philippine Energy Plan 2003 - 2012

PDP for the Low Economic Growth Scenario

University of the Philippines Solar Laboratory page 7

PDP for the High Economic Growth Scenario

a) Installed capacity: 14,632 MW in 2003 to 22,756 MW in 2012

1.5 Clean Power Development Options for the Philippines

• Moderate Clean Power Development (CCPD) Plan

In this plan, capacity addition and utilization of renewable energy (geothermal,

University of the Philippines Solar Laboratory page 8

• Aggressive Clean Power Development (ACDP) Plan

Moderate Clean Power Development (MCPD) Plan