Nuclear Energy in the Philippines

The first United Nations project of its kind, where the prospects of using nuclear
power in a developing country are being analyzed, is being carried out in the
Philippines. It is entitled, "Pre-Investment Study on Power, including Nuclear Power, in
Luzon"; it is a United Nations Special Fund project, for which the International Atomic
Energy Agency is acting as the executing body. Although directed specifically at the
situation of the Luzon grid, the approach and the methods evolved should be useful in
other countries also. The project was initiated in early 1964 and is expected to be
completed by the end of 1965.

In order to undertake a detailed study of the Luzon grid, the Government

approached the United Nations Special Fund for assistance. The essential object of this
study is to develop an optimum power programme. This will be accomplished by
examining the relative economics of different ways of meeting the future load growth of
the grid, taking into account first the extent of the contributions from the indigenous
energy resources and then the possibility of supplementing them by using nuclear
power. In this way, the study will help determine whether it is technically feasible and
economically desirable to use nuclear power to supply a part of the demand between
1965-75. The study has been divided into two phases. Phase A, which was virtually
concluded in February 1965, was aimed at the evaluation of local energy resources and
estimation of local demand. Phase B, which is now under way, deals with the analysis
of different expansion schemes in order to arrive at an optimum power plan. Such a
plan would be based on the maximum economic exploitation of the country's resources,
supplemented as necessary by imported fuel.

At this stage, it is not possible to predict whether the results of Phase B would
indicate that nuclear power is economic or not for the Luzon grid. A final report will be
submitted to the Government by the end of 1965. Whatever be the results of this study,
it is clear that the use of nuclear power in any country, and especially a developing
country, should be based upon thorough economic analysis of the alternatives
available. Nuclear power is but another form of power and the chief object is to have the
lowest cost power, whether the system is thermal, hydro or nuclear. The recent
advances in nuclear power technology which were discussed in detail at the Third
Geneva Conference have clearly indicated that nuclear power offers an attractive
alternative in many situations, especially in reasonably large sizes, for areas where the
fuel costs are about average. If the countries which import their fossil fuels have well-
developed electric power grids in so-called industrial enclaves, the consideration of
nuclear power as an alternative merits attention.

It’s been nearly 35 years since the Philippines mothballed the country’s only
nuclear power plant, declaring the 621-MW Bataan facility would not be commissioned
despite the country spending $2.3 billion on its construction. That decision is being
revisited as the nation looks for a way to increase its power generation capacity, in a
country where demand for electricity is soaring as part of an economic expansion. Fitch
Solutions Group in a September market report said, “Nuclear power will offer an
effective solution to meet the country’s rising power demands over the coming decade,
particularly as coal-fired power—which Philippines has largely turned to—comes under
increasing environmental opposition. Should nuclear be successfully introduced in the
power mix, coal-fired power will face the highest risk of being displaced.”

President Rodrigo Duterte in July 2020 announced an executive order to create

an interagency panel to look at creating a national policy for nuclear energy. Alfonso
Cusi, the Philippines’ energy secretary, has been a vocal advocate of nuclear power as
a way to increase the country’s supply of electricity. Cusi also has said the nation needs
a way to get Southeast Asia’s highest power costs under control. In a statement after
Duterte’s announcement, he said the president’s move is “a major step towards the
realization of a Philippine nuclear energy program,” adding that it would “help shield our
consumers from traditional power price volatilities.” Duterte’s committee is expected to
look at the feasibility of adding nuclear power from both and economic and
environmental standpoint, and the president has said safety will be his top consideration
in deciding whether to pursue a nuclear program. Cusi in September said the country’s
Department of Energy proposed budget for 2021 does not provide funds to build a new
nuclear plant, or upgrade the Bataan site, saying support from lawmakers and the public
must come first.

Previous discussions of starting up the Bataan plant gained little traction, owing
to safety concerns and the plant’s ties to former President Ferdinand Marcos and his
martial law regime. Marcos, who ruled as a dictator for more than 20 years, in 1976
ordered construction of the Bataan plant in response to the global energy crisis; he
maintained that nuclear energy was the country’s answer to the Middle East oil
embargo that had created economic challenges. The plant was never fueled, though,
due to safety concerns after the Three Mile Island accident in the U.S. in 1979, and the
Chernobyl disaster in 1986 in the then-Soviet Union.

The plant’s availability is expected to be a more serious part of any nuclear

discussion this time. Filipino officials also have been talking with Rosatom, Russia’s
state-owned nuclear enterprise, about a feasibility study looking at the deployment of
small-scale nuclear reactors across the country. Rosatom, along with Korea Hydro &
Nuclear Power Co., in 2017 submitted plans to bring Bataan online, with costs ranging
from $1 billion to more than $3 billion. Since 2009, the Bataan facility has been open for
paid tours, which the government said has helped defray maintenance costs.

The plant features a Westinghouse-built light water reactor. The country’s

Department of National Defense, along with the Philippine Nuclear Research Institute,
last year urged the government to revive Bataan. Mauro Marcelo, an engineer who
oversaw the maintenance and preservation of the Bataan plant before he retired earlier
this year, told Reuters that other companies interested in the Philippines’ nuclear
program include China’s top nuclear power plant builder, China Nuclear Engineering
and Construction, and Tractebel, a Belgium-based company that supports development
of energy projects worldwide. Marcelo said bringing Bataan online would be at least a
five-year project, but would be faster than building a new nuclear plant, which would
likely take a decade or longer.

A Rosatom spokesperson in August, in comments submitted to POWER, said

that the company in October 2019 signed a “Memorandum of Intent on cooperation in
the sphere of small modular reactors (SMRs) with the Department of Energy of the
Republic of the Philippines. This allows us to share vast knowledge and experience we
accumulated over the course of 75 years. [The] Department of Energy is following [a]
technologically unbiased approach to create the most efficient, affordable, safe, and
environmentally friendly energy mix for the country. We welcome the recent signing by
President R. Duterte of the Executive Order No. 116 directing a study for the adoption of
a national position on a nuclear energy program.”

Coal-fired power generation accounts for more than half of the Philippines’
electricity, with natural gas and renewables each accounting for just more than 20%.
Oil-fired boilers provide the rest. The Philippines’ rapidly growing economy, which
increased 6.8% in the first three months of this year prior to the worldwide spread of
COVID-19, led to projections that the country’s electricity consumption, which was 90.2
TWh in 2018, according to the International Energy Agency, would triple by 2040.

Carlo Arcilla, director of the Department of Science and Technology-Philippine

Nuclear Research Institute (DOST-PNRI), said recently that “the biggest issue in the
Philippines is that we have one of the most expensive power [costs] in the world.” Arcilla
has said nuclear, while requiring a great upfront investment, would be preferable due to
lower fuel costs. “Ask anyone who has relatives abroad, and they will tell you the stark
difference between their electricity rates and ours,” Arcilla said in a statement in mid-
August. “That’s how the Philippines lags behind other countries in terms of power cost.
Nuclear is simply the cleanest, cheapest and most efficient means of producing
electricity. Nuclear power will especially spare the poorest among the Filipinos who are
the ones actually allotting the lion’s share of their income just for electric bills.”
 Rosatom today accounts for two-thirds of the globally exported nuclear power
projects under construction, with 36 reactors in the pipeline in 12 countries. China also
is growing its nuclear power influence, with 12 projects under construction worldwide.
Both Russia and China have a keen interest in nuclear power in the Philippines and
across Southeast Asia.

The Rosatom spokesperson told POWER: “We believe that nuclear power, which
is reliable in terms of providing stable electricity, is one of the most promising, safe and
economically feasible solutions to supply clean energy to countries of Southeast Asia
and the whole world. Apart from being a key baseload power source, nuclear power
provides zero CO2 emissions and can play a great role in advancing our common efforts
to prevent climate change.”

Rosatom said that SMRs “could be one of the best decisions in terms of nuclear
power development in the region as a mobile solution that does not require large-scale
grid infrastructure. SMRs can provide a stable electricity supply to large industrial
facilities and remote communities and would also be efficient in hybrid systems when
used alongside renewable energy sources. Taking into consideration the geography of
the region, we would say that both onshore and offshore nuclear power plants with SMR
reactors could be a perfect solution. Floating nuclear power plant is an efficient energy
solution for coastal and island territories and can be adapted to different climatic
conditions, such as hot tropical climate, without compromising safety properties. Once
implemented, it can ensure the energy independence of the country.”

Presently, President Rodrigo Duterte has signed Executive Order (EO) 164 that
now includes the potential of nuclear power in the country’s energy mix. This EO was
signed by the Chief Executive last February 28, 2022. Under the new policy, it stated
that the country “shall ensure the peaceful use of nuclear technology anchored on
critical tenets of public safety, national security, energy self-sufficiency, and
environmental sustainability”. Duterte issued the policy following the recommendation of
the Nuclear Energy Program Inter-Agency Committee (NEP-IAC), which conducted a
pre-feasibility study and public consultation on the matter. Through EO 164, the Chief
Executive has recognized that nuclear power can be a reliable, cost-competitive, and
environment-friendly source of energy based on the experience of highly developed
countries.

“For the country to achieve its sustained growth targets, it must ensure that it has
a reliable, secure, sustainable, quality and affordable electricity supply, including
sufficient reserve to guarantee that there will be no disruptions in the power supply,” the
policy read. It added the use of nuclear energy will address the increasing demand for
clean energy, rising by 4.4 percent annually, or an additional capacity of 68 gigawatts by
2040. The EO still included the Bataan Nuclear Power Plant (BNPP) in the national
nuclear program, but other nuclear power installations will be pursued. The BNPP was
the only nuclear power plant in the region during the 1980s, as the Philippines was one
of the first Southeast Asian countries to embark on a nuclear energy program.

However, the project was mothballed because of corruption allegations and

safety concerns on the use of nuclear energy. A study conducted by Russia State
Atomic Energy Corporation (ROSATOM) in 2017 said the rehabilitation of BNPP will
require around USD3 billion to USD4 billion. The public is also becoming more open to
the potential of nuclear energy. “(A) Public Perception Survey on Nuclear Energy in
2019 indicated that almost 79 percent of Filipinos expressed approval or acceptability of
the possible use or rehabilitation of an existing nuclear power plant,” the EO said. The
same survey showed that 65 percent approved the construction of new nuclear power
plants and 78 percent are open to learning more about nuclear energy

Sources:
https://www.pna.gov.ph/articles/1168931 - Philippines News Agency
https://www.powermag.com/philippines-taking-new-look-at-nuclear-power/ - Philippines
Taking New Look at Nuclear Power
https://www.iaea.org/sites/default/files/07304703135_fr.pdf