Building a high voltage grid network in the Philippines-

The Philippines economy is growing rapidly: it is projected to expand annually by 7 per cent between 2012 and 2030. To meet the needs of the economy, power demand will likely increase at an average compound annual growth rate of 4.9 per cent by 2030, nearly 50 per cent higher than the previous decade’s (2002–11) growth rate of 3.3 per cent. This growth in power demand has placed significant strain on the country’s power grid, which will be further aggravated when the new generation capacity of 11.4 GW, under the Philippine Energy Plan (PEP) 2012–2030, comes online.

Current scenario

At present, the country’s grid is owned and operated by the National Grid Corporation of the Philippines (NGCP) – a consortium that consists of the Monte Oro Grid Resources Corporation, the Calaca High Power Corporation, and the State Grid Corporation of China. It was awarded the 25-year concession contract to maintain and operate the transmission assets of the National Transmission Corporation (TransCo) in January 2009 under the Electric Power Industry Reform Act.

As of July 2012, the transmission assets managed by NGCP comprised 19,822 circuit km of high voltage lines and 20,871 MVA of substation capacity. This network transmits the country’s installed capacity of 16,162 MW, of which 14,477 MW was dependable capacity, to the demand centres. The country’s high voltage network comprises primarily of the Luzon grid, the Visayas grid, and the Mindanao grid. While the Luzon and Visayas grids are interlinked through seven high voltage interconnections, the Mindanao grid continues to operate in isolation.

Since most of the country’s dependable capacity, 10,824 MW, is located in Luzon, a major part of the grid network is also situated in this region. Apart from its Luzon grid that extends for 9,482 circuit km, NGCP also owns 4,979 circuit km and 5,361 circuit km of high voltage lines in the Visayas and Mindanao grids, respectively.

 

The Luzon grid

In order to transfer power from bulk generation sources located in the northern and southern parts of the Luzon island to the load centre in the Metro Manila area that accounts for 70 per cent of the island’s total demand, a 500 kV transmission backbone comprising the Northern Transmission Corridor and Southern Transmission Corridor has been laid. However, managing transmission congestion resulting from the inability to expand capacity due to right-of-way issues and space limitations in existing substations is a big challenge, mainly at load centres such as the highly urbanised Metro Manila. In addition, reinforcements are needed to provide a strong connection point for the upcoming wind farms in northern Luzon and increase the reliability of power supply to meet the increasing demand.

The Visayas grid

The five subgrids of Visayas – Panay, Negros, Cebu, Bohol, and Leyte-Samar – are interlinked via submarine cables. Most of Visayas’ installed generation capacity is located in Leyte and Cebu. Power from Leyte helps to meet the needs of Samar and Bohol. Currently, power is supplied only through two single-circuit, 138 kV lines. To ensure continuity of power supply in outage situations, N-1 projects need to be implemented. Also, the majority of the proposed generation is expected to be located away (in Panay) from the major load centres. While some of this planned generation will be used for meeting Panay’s power demand, the majority will be exported elsewhere such as Negros. This would require a significant increase in the amount of transfer capacity.

The Mindanao grid

The Mindanao transmission system is composed of six districts – the North Western Mindanao Area, the Lanao Area, the North Central Mindanao Area, the North Eastern Mindanao Area, the South Eastern Mindanao Area, and the South Western Mindanao Area. The power flow in the Mindanao grid is generally from north to south, with load centres located in the south-eastern (Davao provinces) and southwestern (SOCCSKSARGEN) regions. Due to its high reliance on hydropower, the Mindanao grid is highly susceptible to power outages, especially during the long dry seasons. In order to address the severe demand–supply imbalance, transmission projects will need to be implemented and new power plants will have to be constructed at an accelerated pace.

Another new development that will exert a significant impact on the future evolution of the grid is the increasing share of renewable energy. By 2030, the government plans to triple the existing renewable energy capacity of 5,438 MW. However, the country will still need adequate transmission facilities to tap the huge renewable energy power generation potential in the region.

 

Grid expansion plan

NGCP is currently finalising its 2012 Transmission Development Plan (TDP) that has highlighted the need to implement key projects over the next 10 years in order to ensure grid stability and reliability. The company plans to invest PHP 12 billion in 2013 alone to expand the country’s high voltage network. The majority of the projects planned for the decade are aimed at augmenting and strengthening the country’s transmission capacity to support the unified grid. At the same time, NGCP also plans to implement projects to create adequate transmission infrastructure to utilise renewable energy power in the future. Finally, projects in Mindanao will take priority, as their swift completion will help to bolster the stability, efficiency, and reliability of power transmission in the entire Mindanao grid.

NGCP has already received the Electricity Regulatory Commission’s  (ERC) approval for the implementation of 51 transmission projects across the country during the third regulatory period (2011–15). Of the approved projects, 24 projects will be implemented in Luzon, 15 in Visayas, and 11 in Mindanao, while one will link the Mindanao and Visayas grids. Most of the approved projects are aimed at addressing the issues of increasing load growth, congestion, and the lack of reliability. However, construction work has started for just seven approved projects.

A key project that was recently approved by the ERC is the Leyte–Mindanao Interconnection (Phase I) project to link Mindanao’s isolated grid with the power grid of Visayas and complete the integration of the three regional grids to form a unified Philippine National Grid. Though the Leyte–Mindanao interconnection was first conceptualised as early as the 1980s, the complete project plan and design was only completed by the erstwhile National Power Corporation (NPC) in 1997. At this time, the Asian Development Bank (ADB) had also proposed to fund the interconnection project. However, the initial findings of the feasibility study (conducted by the Japan International Cooperation Agency) recommended postponing the project to 2011.

NGCP, like TransCo, has been pursuing the accelerated implementation of the Leyte–Mindanao link as the interconnection would ensure reliability of power supply in both main island grids as well as enable the sharing of power reserves between them. Following the grant of the provisional authority for the project in August 2011, NGCP initiated the feasibility study on the project. The final configuration of the interconnection project will be based on the results of the feasibility study (Phase I) which is expected to be completed soon.

The private concessionaire has also identified several projects that the country will need in the longer term to ensure the reliable functioning of the grid. NGCP has submitted a provisional authority request to the ERC for the accelerated implementation of some of these projects as described below.

  • Cebu–Negros–Panay 230 kV backbone: The project aims to complete the 230 kV backbone network in Visayas, which only extends up to Cebu at present. The project will provide a direct transmission link from Panay, where bulk power plants are planned, to the load centre in Cebu. As this project will require significant capital expenditure, the company plans to implement it in stages. In Stage I, NGCP will install a second submarine cable between Negros and Panay, along with an overhead line between the Enrique B. Magalona cable terminal station in Negros and the Bacolod substation. The implementation of the later stages will depend on the pace of development of generation projects in Panay and Toledo city.
  • Metro Manila 500 kV backbone: The project involves establishing a 500 kV loop system in the Metro Manila region to strengthen the transmission facilities in the National Capital Region. NGCP plans to set up new substations such as Pasay and Navotas and construct the new 500 kV Hermosa–San Jose line, as well as develop the Taguig extra high voltage (EHV) substation and connect it to Dasmarinas and Antipolo via 500 kV lines.
  • Northern Luzon 230 kV loop: The aim of the project is to provide adequate transmission facilities to tap the huge wind power generation potential in the region and improve the overall reliability of the transmission network. NGCP plans to create a 230 kV loop by linking the north-western and north-eastern 230 kV backbones in Luzon. The 230 kV San Esteban–Laoag transmission line that has already been approved by the ERC constitutes the first stage of the northern Luzon loop. The other segments that will form part of the loop are the Laoag–Bangui line, the Tuguegarao–Magapit line (both are being considered for accelerated implementation), and the Bangui–Pamplona–Magapit 230 kV portion. These segments will be implemented at a later stage.

 

A game plan for a bright future

NGCP has charted an extensive grid development plan to meet the future electricity demand of the country and ensure the reliability of its grid networks. Apart from the challenge of obtaining financing, the successful implementation of the grid projects will also depend on the timely completion of the generation projects served by these lines.