Review of The Oil and Coal Power Plant I

By Maria Crispina B.
Buensuceso
Advised by Engr. Carmelita J. Villanueva
A REVIEW OF THE POWER PLANT (COAL-FIRED AND
FUEL OIL-FIRED) INDUSTRY IN THE PHILIPPINES
An Undergraduate Research Paper

Presented to the Faculty and Staff of the
DEPARTMENT OF CHEMICAL ENGINEERING
College of Engineering
University of the Philippines, Diliman
Quezon City, Philippines, 1101
Submitted in Partial Fulfillment

Of the Requirements for the Course
CHEMICAL ENGINEERING 140:
Chemical Process Industries
Under the supervision of Engr. Carmelita J. Villanueva
MARIA CRISPINA B. BUENSUCESO1

1
Bachelor of Science in Chemical Engineering
ENGR. CARMELITA J. VILLANUEVA

ChE 140 Adviser
Department of Chemical Engineering
April 2018
All rights reserved.

No part of this manuscript may be reproduced in any form, by photographic stat,
microfilm, xerography, and any other means; and/or incorporated into any information
retrieval system, electronic or mechanical, without citing or informing the author.
Acknowledgements
First and foremost, to Ma’am Melit Villanueva – thank you. Thank you for helping me
throughout the arduous journey that is CPI. I was lost and confused and had no idea where to
start. But your unwavering guidance and support, your pieces of advice, and all of your
constructive input have brought this paper to life, and to where it is now. Never yet have I
worked quite as hard in a college requirement as I have with this; I am proud of what I have
done, and hopefully I have made you proud too.
To my family – for understanding me for all the times that I skipped out on dinners, outings,
and all things in between, just to finish my paper. Thank you for being some of the best
supporters and shock absorbers I could ever have. But not like you have a choice. Haha, just
kidding.
To the engineers and representatives of TeaM Sual – you will probably never see this
paper, but I am incredibly grateful that you have allowed us to visit the plant. It was the most
exhilarating experience I have ever had as an undergraduate ChE student, and seeing you
guys out there in the field makes me excited for the future that is to come.
To my friends – for being my anchors. Knowing that we were all in this together made me
push through and overcome all the struggles and obstacles.
To my Sual teammates, Gabby, Janina, and Altair – although our time together was very
brief, I enjoyed our day trip together. Thank you for waking up at 2 am (or not sleeping) for our
call time. Thank you for answering all of my questions whenever I missed something in my
notes from our plant visit. Special shout-out as well to my ever-reliable Driver Mario for driving
us to Sual (and back) and never complaining, despite having to drive for a good 10 hours.
Lastly, to the Kapitana de Industriya and original Girl Boss - my beloved Lola Ma’am. Thank
you for showing me the true meaning of grit, determination, and passion. Sometimes I still
can’t quite believe that you’re gone, but I know that you’re in a better place. The legacy you
left us with will never be forgotten. This is for you.
Maria Crispina B. Buensuceso

Author
2
Table of Contents
Acknowledgements ............................................................................................................... 2
List of Tables ........................................................................................................................ 6
Table of Figures .................................................................................................................... 7
Scope and Limitations........................................................................................................... 9
Abstract .............................................................................................................................. 10
Industrial Profile and Product Overview .............................................................................. 12
Electricity..................................................................................................................... 12
Power Generation Development.................................................................................. 12
The Coal-Fired Power Plant Industry............................................................................... 13
A Brief History of Electricity in the Philippines ................................................................. 14
The Philippine Electricity Sector ...................................................................................... 15
Power Generation ........................................................................................................... 17
Plant Source Classification .......................................................................................... 18
Power Transmission........................................................................................................ 25
Grid Classification ....................................................................................................... 25
Company Profile ............................................................................................................. 27
Sual Power Station ...................................................................................................... 27
Manufacturing Process................................................................................................ 28
Market and Economics Profile............................................................................................. 29
An Introduction on the Raw Material: Coal ...................................................................... 29
Market Profile .................................................................................................................. 30
Market Dynamics ............................................................................................................ 33
Market Share and Competition .................................................................................... 33
Power Distribution ....................................................................................................... 36
Regional Data ............................................................................................................. 37
Global Data ................................................................................................................. 38
Economic Outlook and Forecasting ............................................................................. 40
Laws and Policies ....................................................................................................... 42
Raw Materials ..................................................................................................................... 45
Coal ................................................................................................................................ 45
General Description..................................................................................................... 45
Coal Ranks ................................................................................................................. 45
Coal Preparation ......................................................................................................... 46
Coal Storage ............................................................................................................... 46
Fuel Oils.......................................................................................................................... 46
Types of Fuel .............................................................................................................. 46
Economics ...................................................................................................................... 47
3
Manufacturing Process ....................................................................................................... 48
Sual Power Station Process Overview ............................................................................ 48
Feed Water Pre-Treatment ............................................................................................. 49
Coal Preparation ............................................................................................................. 50
Steam Generation ........................................................................................................... 50
Steam Condensing ...................................................................................................... 52
By-Products and Further Processing ............................................................................... 52
Wastewater Discharge and Treatment ............................................................................ 55
Process Controls................................................................................................................. 56
Centralog ........................................................................................................................ 56
Controbloc ...................................................................................................................... 56
Controcad ....................................................................................................................... 56
Continuous Emissions Monitoring System ...................................................................... 57
Equipment Design and Safety ............................................................................................. 58
Equipment Specifications ................................................................................................ 58
Coal Mill ...................................................................................................................... 58
Boiler........................................................................................................................... 58
Condenser .................................................................................................................. 58
Turbine ........................................................................................................................ 58
Generator .................................................................................................................... 58
Chimney ...................................................................................................................... 58
Safety Engineering and Maintenance .............................................................................. 58
Energy Requirements ..................................................................................................... 59
Supply Chain ...................................................................................................................... 61
1000-MW Energy Conversion Agreement ....................................................................... 62
Excess Capacity ............................................................................................................. 62
Wholesale Energy Spot Market ....................................................................................... 62
Electricity Pricing ............................................................................................................. 62
Health, Safety, and Environment......................................................................................... 65
Process Safety ................................................................................................................ 65
Waste Management and Pollution Prevention ................................................................. 69
Material Use ................................................................................................................ 71
Water Use ................................................................................................................... 71
Emissions.................................................................................................................... 71
Effluents ...................................................................................................................... 71
Wastes ........................................................................................................................ 72
Incidents...................................................................................................................... 72
Occupational Safety ........................................................................................................ 72
Use of PPE ................................................................................................................. 73
4
Ergonomics ................................................................................................................. 73
Ventilation ................................................................................................................... 74
Medical Examinations ................................................................................................. 74
Certifications and Awards................................................................................................ 74
Research and Development................................................................................................ 76
Process Development ..................................................................................................... 76
Co-Firing ..................................................................................................................... 76
Clean Coal Technology ............................................................................................... 76
Carbon Dioxide Capture and Storage .......................................................................... 78
Shifting to Renewable Energy ..................................................................................... 78
Conclusion .......................................................................................................................... 81
Glossary ............................................................................................................................. 82
References ......................................................................................................................... 84
Appendix A ......................................................................................................................... 86
Appendix B ......................................................................................................................... 88
Appendix C ......................................................................................................................... 90
Appendix D ......................................................................................................................... 92
Appendix E ......................................................................................................................... 93
Appendix F.......................................................................................................................... 95
Appendix G ......................................................................................................................... 96
Appendix H ......................................................................................................................... 98
5
List of Tables
Table 1. Economic Impacts of Neurath Facility in Germany ................................................ 40

Table 2. Raw Materials Used (April 2014-May 2015) .......................................................... 47
Table 3. Cost Analysis of Raw Materials ............................................................................. 47
Table 4. Total Water Withdrawal (April 2014 to March 2015) .............................................. 49
Table 5. Emissions of Sual Power Station ........................................................................... 57
Table 6. Energy Intensity (April 2014 to March 2015) .......................................................... 60
Table 7. Summary of Risks, Hazards, and Standards in Coal-Fired Power Plants .............. 66
Table 8. Summary of Waste Management and Pollution Prevention Strategies .................. 70
Table 9. Wastewater Discharges ........................................................................................ 72
Table 10. DOE Renewable Energy Roadmap (2017-2040) ................................................. 80
6
Table of Figures
Figure 1. Power Generation from Coal ................................................................................ 14

Figure 2. Philippine Electricity Segmentation ...................................................................... 16
Figure 3. Philippine Power Consumption vs. Generation from 2012 to 2016 ....................... 16
Figure 4. Philippine Dependable Capacity vs. Peak Demand from 2012 to 2016 ................ 17
Figure 5. Power Generation (Renewables vs. Non-Renewables) in the Philippines from 2012
to 2016................................................................................................................................ 18
Figure 6. Power Generation per Source in the Philippines from 2012 to 2016..................... 19
Figure 7. Power Generation in Luzon per Source from 2012 to 2016 .................................. 20
Figure 8. Luzon Grid Dependable Capacity vs. Peak Demand from 2012 to 2016 .............. 21
Figure 9. Power Generation in Visayas per Source from 2012 to 2016 ............................... 22
Figure 10. Visayas Grid Dependable Capacity vs. Peak Demand from 2012 to 2016 ......... 23
Figure 11. Power Generation in Mindanao per Source from 2012 to 2016 .......................... 24
Figure 12. Mindanao Grid Dependable Capacity vs. Peak Demand from 2012 to 2016 ...... 25
Figure 13. Power Consumption vs. Generation per grid in MWh from 2012 to 2016 ........... 26
Figure 14. Sual Power Station (Cardinoza, 2014) ............................................................... 28
Figure 15. Total Coal Consumed by Power Generation Sector from 2012 to 2016.............. 29
Figure 16. Total Coal Imports per Country in 2016 .............................................................. 30
Figure 17. Total Generation Mix (based on 82687 MWh) in the Philippines as of 2016 ....... 31
Figure 18. Total Generation Mix (based on 66498 MWh) in Luzon as of 2016 .................... 32
Figure 19.Total Generation Mix (based on 12955 MWh) in Visayas as of 2016 .................. 32
Figure 20. Total Generation Mix (based on 11345 MWh) in Mindanao as of 2016 .............. 33
Figure 21. Dependable Coal Capacity Mix (based on 7125 MW) in the Philippines as of
December 2017 .................................................................................................................. 34
Figure 22. Coal Power Plant Dependable Capacity Mix (based on 5304 MW) in Luzon as of
December 2017 .................................................................................................................. 34
Figure 23. Coal Power Plant Dependable Capacity Mix (based on 904.4 MW) in Visayas as of
December 2017 .................................................................................................................. 35
Figure 24. Coal Power Plant Dependable Capacity Mix (based on 965) in Mindanao as
December 2017 .................................................................................................................. 36
Figure 25. Total Philippine Power Consumption per Sector from 2012 to 2016 ................... 37
Figure 26. Total Coal-Sourced Power Generation in ASEAN by Country ............................ 38
Figure 27. Coal-Fired Power Generation by Country (2016)................................................ 39
Figure 28. Neurath Power Station ....................................................................................... 40
Figure 29. Grid Demand Forecast from 2018 to 2022 ......................................................... 40
7
Figure 30. Total Coal Dependable Generating Capacity in the Philippines from 2012 to 2016
........................................................................................................................................... 41
Figure 31. Projected Electricity Demand per Source ........................................................... 42
Figure 32. Types of Coal ..................................................................................................... 45
Figure 33. Process Flow Diagram of Sual Power Station .................................................... 48
Figure 35. Sample Coal Bunkers ........................................................................................ 50
Figure 36. Cross Section of a Pulverized Coal Boiler .......................................................... 50
Figure 37. Sual Power Station Boiler (Unit 1) ...................................................................... 51
Figure 38. Schematic of a Steam Turbine ........................................................................... 52
Figure 39. Electrostatic Precipitator (Sample) ..................................................................... 53
Figure 40. Schematic of a Flue Gas Desulfurization Tower ................................................. 54
Figure 41. Sual Power Station's 226-m Chimney ................................................................ 54
Figure 42. Sual Power Station Control Room Simulator ...................................................... 56
Figure 43. Electricity Distribution Overview ......................................................................... 61
Figure 44. General Supply Chain of Sual Power Station ..................................................... 61
Figure 45. Sample MERALCO Bill ...................................................................................... 62
Figure 45. Training Session in Sual Power Staton .............................................................. 73
Figure 46. Certifications of Sual Power Station ................................................................... 75
Figure 47. Subcritical Unit (Drum-type Boiler) ..................................................................... 77
Figure 48. Supercritical and Ultra-Supercritical Unit (Once Through-type Boiler) ................ 77
8
Scope and Limitations
The study aims to give an overview of the chemical process of electricity generation
from thermal coal and from fuel oil. However, as the paper progresses, it will focus more on
coal-fired power generation. The Philippine electricity sector will also be analyzed, but its
discussion will only be limited to either the power industry as a whole, or how it correlates with
the coal-sourced electricity.
This paper is segmented into three phases: the industrial and market profile, the
“manufacturing” process, and the industrial health, safety, and environment guidelines. For
Phase 1, all grid-connected, embedded, and off-grid generators will be used. Furthermore,
dependable capacity will be used as the basis of comparison for power demand. For Phases
2 and 3, these will be focused on the operations and protocols of the Sual Power Station
operated by TeaM Energy in Sual, Pangasinan.
The main sources of the data, especially Phase 1, is from the Department of Energy,
the World Bank, and the Philippine Statistics Authority. Due to lack of published data, most
discussions encompass only up to the year 2016.
Currency Conversion: 1 USD = 52.08 PHP
9
Abstract
The objective of this study is to review the coal-fired and fuel oil-fired power plant
industry in the Philippines in three phases, which encompass local and global economics, the
manufacturing process, and health, safety, and environmental (HSE) analysis. This paper was
done following an in-depth plant visit to the coal-fired Sual Power Station, in addition to
collating and analyzing relevant information from multiple sources, such as the Department of
Energy, the Philippine Statistics Authority, the Wolrd Bank, and handbooks on coal-fired
generation.
From Phase I, which analyzed the economics of the power sector in the Philippines
and correlated it with global trends, it is concluded that fuel oil’s role as an electricity source
is steadily declining, and it is predicted that in the near future, reliance on fuel oil will be
minimal. On the other hand, coal is emerging to be the top fuel of choice in the Philippines, as
it is cheap and reliable.
Phase II discusses the electricity generation process of the Sual Power Station in
Pangasinan, and the process can be summarized as a continuous stream of energy change:
potential energy from coal transforms into mechanical energy, which is then transformed into
electrical energy via a generator. This produced energy is then thrown into the grid and is
distributed to consumers through a connection of transmission lines.
Lastly, the HSE analysis showed that the Sual Power Station is extremely diligent and
compliant when it comes to pollution prevention and control, risk management, and
occupational safety and worker development. This can be supported with their numerous
accolades from various government departments.
From the three-phase review, it can be concluded that the Philippines will continue to
rely on coal as an energy source, especially while renewable energy technology is still being
developed in the Philippines. Until then, the reliance on coal can and should be done
responsibly by adapting clean coal technologies and pollution control measures.
10
A Review of the Power Plant Industry in the Philippines
PHASE I – Industrial Profile and Market & Economics
11
Industrial Profile and Product Overview
A Brief Overview on Power Plants and Electricity
Electricity
For the past century, electricity has been one of the most valuable, versatile, and most
easily controlled forms of energy. It fuels our day-to-day activities and simplifies complicated
tasks as it supports machinery and appliances. However, the discovery of the simplest form
of electricity actually dates to 600 B.C., wherein Thales of Miletus pondered upon amber being
charged by rubbing. This novel concept is what we now call static electricity.
In the 1800s, Benjamin Franklin reintroduced the concept of electricity with his famous
kite experiment. When lighting struck the kite, the electricity travelled down into the attached
Leyden Jar, an old-fashioned capacitor. Alessandro Volta later proved that electricity could
travel over wires when he invented the first electrical battery. By 1879, electricity was already
being distributed to residential homes through direct current (DC). It was not until 1888 when
Nikola Tesla invented the first rotating field alternate current (AC) alternator to rival the DC
system introduced by Thomas Edison. The DC sources raised many issues with its use, such
as deaths of small children, house fires, and the necessity to have multiple substations. The
introduction of AC sources remedied these problems, and it revolutionized the way electricity
is distributed across large distances (Grigsby, 2007a).
Since then, the electricity industry has been making vast strides, whether it be in
generation or distribution. According to the World Bank, there are about 62,500 power
generating units in the world, and 85.315% of the world’s population has access to electricity.
Power Generation Development

Power generation is the process of generating electrical power from other sources of
primary energy (Mansoor-Ul-Hassan, 2014). The fundamental principle of electricity
generation was discovered by British scientist, Michael Faraday: electricity is generated by
the movement of a wire loop between the poles of a magnet.
The first recorded power station appears to have been in the Bavarian town of Ettal in
1878, which used a steam engine to drive 24 dynamos (a generator that produced direct
current), with the electricity used to provide lighting for a grotto in some gardens. Meanwhile,
the first public power station utility was built in 1881 in Surrey, United Kingdom, which made
use of water-wheels. Thus, it can be concluded that hydropower and steam power, which was
fueled by coal, were the first drivers of electricity generation (Breeze, 2005).
By the 20th century, the spark-ignition engine and diesel engine had been developed,
which could also generate electricity. Developments as well on the use of wind power had
been made. Nonetheless, steam turbine power stations burning coal, and sometimes oil or
gas, together with hydropower stations provided the bulk of power generation capacity until
the beginning of the 1960s.
In the 1950s, nuclear power was born, and was especially popular in western Europe,
Germany, Scandanavia, Great Britain, and France. Other developments, such as the gas
turbine were made in the 1980s, and this was used in series with steam turbines in a
configuration known as the combined cycle plant. This configuration had become the main
source of new base-load capacity in many countries where natural gas is readily available.
Furthermore, the 21st century brought an onslaught of new electricity sources, with an
emphasis on renewables. In addition to hydropower, wind and solar energy, and biomass, fuel
cells are approaching commercial viability.
12
Currently, the net electricity generation in the world is mainly from the following
sources: coal, liquid fuels, natural gas, nuclear energy, hydropower, wind, geothermal, solar,
and other renewable sources (like biomass). With that, this paper will attempt to dissect coal
and fuel oil as sources for electricity.
Fuel Oil for Electricity Generation

Oil, otherwise known as petroleum or crude oil, is a fossil fuel and liquid hydrocarbon
that is primarily used for the production of transportation fuels and petroleum-based products.
It was also the primary fuel source of older steam generating plants, such as in the mid-1970s
when oil was abundant and relatively cheap. In fact, based on the World Bank, almost a
quarter of the global electricity was then generated from oil in the early 1970s. However, in
the most recent records (2014), the share of fuel oils was only 4.069%.
The significance and actual role of oil as a utility fuel, especially as an electricity source
rapidly changed over the past decades due to various factors. One reason that accounts for
the relative decline of oil as fuel for electricity generation is technology change. When oil prices
collapsed in 1986, oil could not regain its lost market shares in the power sector; instead,
natural gas became the fastest growing fuel for electricity generation (Mourshed, 2013).
Another reason is government policy in many countries prompted by the oil market politics of
and the oil price hikes during the 1907s and early 1980s by the Organization of the Petroleum
Exporting Countries (OPEC). Furthermore, supply shortages during world events like the Arab
Oil Embargo, the Iranian Revolution, and the Iran-Iraq war also discouraged fuel oil-fired
electricity generating capacity additions all over the globe (Toth & Rogner, 2006).
Although its share is rapidly declining, oil – primarily diesel and heavy fuel oil –still
remains a fuel for power generation in some parts of the country, particularly in areas that lack
access to a grid or to infrastructure to supply coal or natural gas to. For example, there is a
large number of diesel-grid-connected power plants in particularly in the Visayas region
because it is composed of so many islands, as compared to Luzon and Mindanao.
Another function of oil in electricity generation is that when other fuel options are limited
or uneconomical, oil can fill the gap, since it can be stored in large tanks for extended periods.
For instance, plants that would normally burn coal may opt to burn petroleum during times of
high coal demand (i.e. oil is the cheaper alternative). Oil can also assist in meeting peak-load
demand. Furthermore, oil has never really provided a large share for public supply; most of
the power generation is for auto-production/embedded systems.
For the remainder of this paper, the emphasis shall be the usage of coal as an
electricity source since the use of fuel oil is rapidly declining in the power plant industry and
for public utility.
The Coal-Fired Power Plant Industry

The World Coal Association defines coal as a combustible, sedimentary organic rock
that is composed of mainly carbon, hydrogen, and oxygen. It is formed from vegetation and
prehistoric remains that have been consolidated between rock stratigraphy and is modified by
the effects of pressure and heat over millions of years to form coal seams. It is a fossil fuel
that is more abundant that oil or natural gas; there is around 150-200 years’ worth of coal
remaining for worldwide consumption.
Coal is used in various industries like steel and cement production, but it’s most largely
used in the power sector - around a third of all the energy consumed worldwide, and coal-fired
power plants, also known as power stations, provide more than 41% 9690 TWh of the global
electricity supply as of 2015 (International Energy Agency, 2010). There are concerns about
it causing air pollution and greenhouse gas, thus causing a downward trajectory in its use in
stronger economies like China and the United States. However, it will still most likely remain
13
as a key component of the fuel mix for power generation to meet the ever-growing demand
for electricity, especially in developing countries.
Steam or thermal coal is the type of material used in power stations, and it is used to
produce electricity in one uniform process. The working concept is that chemical energy is
ultimately converted into electrical energy through a series of unit operations and processes.
The following figure is obtained from the World Coal Association.
Figure 1. Power Generation from Coal

Source: World Coal Association
A Brief History of Electricity in the Philippines

Electricity in the Philippines dates to 1890 as it was first provided to the greater Manila
area by Sociedad Mercantil. This company was later known and established as La Electricista
in 1892 in association with the Compania de Tabacos de Filipinas (TABACLERA), and they
provided electric lighting for city streets, parks, and other public places that were initially
illuminated by oil lamps. La Electricista was permitted to have private arrangements with
customers to have their homes and establishments illuminated by incandescent lamps as well.
By the turn of the new century, La Electricista had well over 3000 customers, in addition to its
street-lighting business (Patalinghug, 2003).
In 1903, the Philippine government began accepting bids to operate Manila’s electric
tramway, as well as provide electricity to the city. The only bidder was a Detroit-based
businessman, Charles M. Swift, who founded a new company, The Manila Electric Railroad
and Light Company, or MERALCO. This company bought La Electricista the following year,
and by 1906, the company boasted a yearly power output capacity of roughly 8 million kWh.
By 1925, MERALCO was able to expand its services to other parts of Luzon by acquiring the
franchises and power plants of small provincial electric companies, enabling it to expand
beyond its Manila city-center base.
In 1936, the National Power Corporation (NPC) was created to develop the Philippine’s
the country’s construction, operation, and maintenance of facilities to produce electricity. In
1960, the Philippine Congress then established the Electrification Administration (EA) to
implement the government’s objective of providing electricity to the entire country. Through
this, franchises were granted to private companies to encourage them to set up distribution
14
systems in rural areas. Some of them generated their own power, but most of them made bulk
purchases of power generated by NPC. The EA also supported the development of some
217 small companies (each with less than 500 kilowatts of capacity), but many of them did not
survive because of technical, financial, and managerial difficulties (Sharma, Madamba, &
Chan, 2004).
In 1969, the National Electrification Administration (NEA) was created by Congress to

replace EA as the implementing agency of the country’s total electrification policy. Under
NEA, electric cooperatives were designated as the country’s primary electricity distribution
system. And by 1971, there were about 479 electric utility generating plants with a total
capacity of 2,314,868 kilowatts. At the same time, 22.5% of the population already had access
to electricity. Later, in 1973, NEA was converted into a public corporation by Public Decree
No. 269, which allowed NEA to have sole authority in the regulation of electric cooperatives.
In 1997, the Philippine Government began a program to restructure the power sector
and to make the nation’s electricity more reliable, accessible, affordable, and sustainable
(ADB, 2016) and it was embodied through the Electric Power Industry Reform Act (EPIRA) of
2001. The program involved splitting the industry into generation, transmission, and
distribution; introducing competition in power supply and generation; introducing a wholesale
electricity spot market (WESM); privatizing generation and operation of transmission by
concessionaires; introducing open access distribution networks; and setting up an
independent agency for regulation purposes (Senate and House of Representatives of the
Philippines, 2001). Prior to EPIRA’s enactment, NPC was responsible for developing and
managing the generation and transmission in the national power supply system - it was the
main producer of electricity and the single buyer of independent power producers. However,
with the EPIRA’s total overhaul of the power industry, the control of the generation and
transmission sectors were passed on from the weakened and in-debt NPC.
According to the World Bank, as of 2016, 89.6% of the Philippines has access to
electricity. Meanwhile, the Duterte administration aims to meet a 100% electrification target by
the year 2020. In addition, they are also targeting a “one-grid Philippines”, with the Mindanao
grid interlocking with the Visayas and Luzon grids by 2022.
The Philippine Electricity Sector

The major product produced by the industry is electric power and its complementary
services consist of transmission services, distribution services, and suppliers’ services that
involve selling, brokering, marketing or aggregating electricity to the end-users (ADB, 2016).
Entry and operation conditions of electric utilities in the Philippines are overall,
governed by the Public Service Law administered by the Energy Regulatory Commission
(ERC). The ERC also has the capacity to implement technical, customer service and financial
standards for The National Transmission Corporation (TRANSCO), generating and
distributing companies to ensure the reliability and affordability of the electricity provided, and
to ensure entities’ financial stabilities. Furthermore, R.A. 9136 (Electric Power Industry Reform
Act of 2001 or EPIRA) mandates that the ERC shall regulate the retail rates charged by
distribution utilities and the transmission charges of TRANSCO.
Upon implementation, EPIRA moved for the restructure of the electrical utilities
industry in the Philippines, and it was divided into four general sectors, namely: generation,
transmission, distribution, and supply, as shown in Figure 2.
15
Distribution
Generation Transmission
Supply
Figure 2. Philippine Electricity Segmentation
From the raw energy source, the generation units convert these into useable electricity
for consumption, while the transmission sector operates and maintains the high voltage
transmission facilities, including the grid interconnections. The distribution sector is
responsible for the network of power lines, underground cables, and substations that transmit
electricity within its jurisdiction (franchise area). Lastly, the supply sector, according to R.A.
9136, is a business affected with public interest. They basically supply electricity to the market
for a fee. The prices to be charged by these suppliers are contestable and subject to regulation
by the ERC.
According to The Energy Report: Philippines by the KPMG Global Energy Institute
(Somani et al., 2014), the Philippines is now considered as one of the fastest-growing nations
in the entire world. Likewise, the country’s consistent gross domestic product growth of 7%
has been reflected in the necessity for an increase in investments in power and its
infrastructure. The increasing trend of the total power generation and consumption in the
Philippines from 2012 to 2016 is shown in Figure 3.
Philippine Total Power Consumption vs. Generation

Source: Department of Energy
100,000,000
90,000,000
80,000,000
70,000,000
Power in MWh
60,000,000
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
0
2012 2013 2014 2015 2016
Consumption 72,922,010 75,265,842 77,260,998 82,413,213 90,797,892
Generation 72,922,011 75,265,841 77,260,997 82,413,212 90,797,892
Figure 3. Philippine Power Consumption vs. Generation from 2012 to 2016
Source: Department of Energy; Refer to Appendix B1, B2.
It is interesting to note that the consumption is equal to the generation every year. This
is because Philippine power plants import materials for operations, as power lines connecting
to other countries for interconnected transmission would be impractical due to the geography
and terrain.
16
The increasing consumption in electricity (from 72922010 MWh in 2012 to 9079792
MWh in 2016) can be attributed to the worsening effects of El Niño, as more establishments
and residential areas had greater requirements for cooling systems. Another source as well
of the increasing consumption is growing economy, and the development of more private and
public infrastructure.
While consumption can represent the amount of electricity that is consumed over a
certain time (i.e. MWh), electricity can also be represented in terms of demand, which is the
rate at which electricity is consumed (i.e. MW). Some utilities calculate electric rates based on
time-of-use consumption, and others would base electricity charges on the peak demand,
because they must be able to deliver electricity to meet that demand.
Philippine Dependable Capacity vs. Peak Demand

25000
20000
15000
Power in MW
10000
5000
0
2012 2013 2014 2015 2016
Dependable Capacity 15075 15380 15633 16441 19098
Peak Demand 10005 11305 11822 12213 13272
Figure 4. Philippine Dependable Capacity vs. Peak Demand from 2012 to 2016
Source: Department of Energy; Refer to Appendix B4, B5.
Figure 4 shows that the dependable capacity – meaning, the power that can actually
be supplied and is used - is greater than that of the annual peak demand of power across the
nation. 2016 saw an 8.7% increase in peak demand, which is significantly greater than the
increases throughout the previous years. Regardless of the Philippine’s increase exposure to
global risks and natural calamities such as Typhoon Pablo (2012) and Yolanda (2013), and
the Bohol Earthquake (2013), electricity consumption still continued to grow. Couple that with
the El Niño Phenomenon (2015-2016) which resulted in a greater electricity demand due to
increased cooling requirements, and it is almost inevitable that the demand will grow. The
growth as well in the country’s economy, driven by the development of the industrial and
agricultural sectors, may also be primary drivers in the increase in power demand.
Power Generation
The generation sector is composed of generation companies, co-generation
companies, and independent power producers. They convert primary energy sources, such
as coal and oil, as well as renewable sources like solar and wind power, into electricity.
17
Plant Source Classification
Energy sources in the Philippines can be classified into two: renewable energy sources
and non-renewable energy sources. According to the National Power Corporation, renewable
sources are those that do not have an upper limit on the total quantity to be used. Such
resources are renewable on a regular basis and the renewable rate is rapid enough to consider
availability over an indefinite period. Non-renewable energy sources, on the other hand, do
not renew themselves at a sufficient rate for sustainable economic extraction in meaningful
human timeframes. These resources will deplete and not be replenished in our lifetimes.
Power Generation (Renewable vs Non-Renewable)

in the Philippines
80,000,000
70,000,000
60,000,000
Power in MWh
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
-
2012 2013 2014 2015 2016
Renewables 10,509,468 9,883,641 10,672,382 12,298,000 13,868,000
Non-Renewables 52,160,409 55,362,893 57,451,343 61,450,122 68,818,650
Figure 5. Power Generation (Renewables vs. Non-Renewables) in the Philippines from 2012 to 2016
Source: Department of Energy; Refer to Appendix B3
Non-renewable energy sources are the primary drivers of electricity generation in the
Philippines, as shown in Figure 5. This may be because it is generally easier to produce
electricity from these sources and are more cost-efficient. Renewable energy, on the other
hand, may depend on specialized equipment, which tend to be more expensive that its
alternative. Furthermore, some renewable resources rely heavily on weather and can gravely
be affected by natural phenomena (droughts, torrential rains, etc.). Gradually, however, the
use of renewable energy is growing through the years. This increasing trend of renewable
energy use may be attributed to the fairly new government initiatives and programs, such as
the Feed-in-Tariff (FIT) incentives and a review of the country’s fuel mix policy in favor of
renewable energy (Olchondra, 2016). FIT is the per-kilowatt-hour rate guaranteed to
renewable energy developers to ensure the viability of their products.
Renewable and non-renewable energy sources can be funneled down into more
specific classifications. For renewables, there is hydropower, geothermal, wind, biomass, and
solar energy. As for non-renewable energy sources, the most common are coal, oils, natural
gas, and nuclear energy. For the following figures, the sources are as follows: for non-
renewables: coal, oil-based, and natural gas; for renewables: geothermal, wind, solar,
biomass.
18
Power Generation per Source in the Philippines
50,000,000
45,000,000
40,000,000
35,000,000
Power in MWh
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
2012 2013 2014 2015 2016
Coal 28,264,867 32,081,007 33,053,518 36,685,685 43,303,242
Oil-Based 4,254,015 4,490,600 5,707,748 5,886,437 5,661,408
Natural Gas 19,641,527 18,791,286 18,690,077 18,878,000 19,854,000
Geothermal 10,249,990 9,604,598 10,308,113 11,044,000 11,070,000
Wind/Solar 76,659 67,069 168,570 887,000 2,072,000
Biomass 182,819 211,973 195,699 367,000 726,000
Figure 6. Power Generation per Source in the Philippines from 2012 to 2016
Figure 6 shows that consistently, the most-used and primary energy source is coal, its
use peaking at 2016. This is primarily due to its cheap cost and because of the investments
in coal-fired generating capacity as companies and the government build a slew of new power
plants to support the country’s growing electricity demand (Saulon, 2017). Meanwhile, the use
of oil, geothermal power, and natural gas remained fairly constant throughout the five-year
period. In the year 2016, the use of wind/solar energy, as well as biomass doubled from the
previous year as more investments were made in the renewable energy sector.
19
Total Power Generation in Luzon per Source
35,000,000
30,000,000
25,000,000
Power in MWh
20,000,000
15,000,000
10,000,000
5,000,000
0
2012 2013 2014 2015 2016
Coal 21,878,000 25756000 27346000 29680000 33143000
Oil-based 1800000 1601000 2342000 1845000 2562000
Natural Gas 8993000 18783000 18686000 18878000 19854000
Geothermal 3588000 3399000 3817000 4096000 4227000
Hydropower 5292000 5156000 4357000 4769000 5011000
Biomass 37000 60000 65000 187000 439000
Solar/Wind 75000 66000 152000 658000 1262000
Figure 7. Power Generation in Luzon per Source from 2012 to 2016
Source: Department of Energy; Refer to Appendix C1
Aligned with the nation’s primary source of fuel for electricity, Luzon also greatly relies
on coal for power generation, with natural gas as its secondary source of fuel. The increase
in coal-sourced energy is attributed to the operation of new, large coal plants in the region.
Meanwhile, the great amount of natural gas used by the Luzon grid can be attributed to the
Ilijan Power Plant, which has the largest generation capacity of a power plant of its kind in the
Philippines. It is fueled with natural gas from the Malampaya gas field of Palawan. However,
the Malampaya facility only has six years left before it runs out of natural gas, so it should be
the government’s priority to find other sources of fuel within the country’s jurisdiction to sustain
the region. Furthermore, the growth rate of the renewable energy sectors remained relatively
stagnant up until 2013 when new wind farms were added to the existing 33 MW Bangui Wind
Farm. The additions include the 18.9 MW Bangui Phase 3 Wind Farm, the 150 MW EDC
Burgos Wind, the 81 MW NLREC Caparispisan, and the 54 MW Pilila Wind in Rizal (Cusi,
2016b).
20
Luzon Grid Dependable Capacity vs. Peak Demand
16000
14000
12000
10000
Power in MW
8000
6000
4000
2000
0
2012 2013 2014 2015 2016
Peak Demand 7178 8305 8717 8928 9726
Figure 8. Luzon Grid Dependable Capacity vs. Peak Demand from 2012 to 2016
Based on Figure 8, the dependable energy capacity every year is sufficiently greater
than the peak demand in the Luzon grid. This means that power generators can reliably
provide the theoretical maximum amount electricity required in the region. The increase in
dependable capacity as of the year 2016 (compared to 2015) is 11.7% and can be attributed
to the developments made in the region, as mentioned above. Also, due to its already matured
and highly industrialized economy, the demand (and capacity) of Luzon is the highest for the
whole country.
21
Total Power Generation in Visayas per Source
7,000,000
6,000,000
5,000,000
Power in MWh
4,000,000
3,000,000
2,000,000
1,000,000
0
2012 2013 2014 2015 2016
Coal 4,701,000 4690000 4449000 4968000 5270000
Oil-based 734000 796000 766000 672000 637000
Natural Gas 0 8000 4000 0 0
Geothermal 5930000 5463000 5627000 6105000 5974000
Hydropower 46000 37000 35000 38000 64000
Biomass 71000 106000 117000 159000 276000
Solar/Wind 0 0 15000 228000 734000
Figure 9. Power Generation in Visayas per Source from 2012 to 2016
Based on Figure 9, geothermal is the leading energy source in the Visayas region. The
capacity is even expected to increase as Department of Energy even plans to increase the
country’s renewable energy-based capacity by 200% in the next 15 years under the National
Renewable Energy Program (NREP). There is a significant drop, however, in the power
generation in 2013. This is because Typhoon Yolanda had affected the Energy Development
Corporation’s geothermal plant in Leyte, a major power generator in the region. On the other
hand, oil-based generation was stable until 2015 because a number of baseload capacities
were introduced to the area at that time.
22
Visayas Grid Dependable Capacity vs. Peak Demand
3000
2500
Power in MW
2000
1500
1000
500
0
2012 2013 2014 2015 2016
Peak Demand 1481 1572 1636 1768 1893
Figure 10. Visayas Grid Dependable Capacity vs. Peak Demand from 2012 to 2016
Similar to the case of the Luzon grid, the dependable capacity every year is greater
than the peak demand of the Visayas region. The timeframe of 2015 to 2016 saw a relatively
higher capacity growth at 25.7%, compared to the relatively stable ones from previous years.
The growth is due to a string of new power plants, which provided a leeway for the increase
in electricity capacity and demand in the region. Furthermore, there was an increase in
commercial and industrial activities and developments over the period.
23
Total Power Generation in Mindanao per Source
6,000,000
5,000,000
Power in MWh
4,000,000
3,000,000
2,000,000
1,000,000
0
2012 2013 2014 2015 2016
Coal 1,686,000 1635000 1258000 2038000 4890000
Oil-based 1720000 2094000 2599000 3369000 2462000
Natural Gas 0 0 0 0 0
Geothermal 731000 743000 864000 842000 869000
Hydropower 4913000 4827000 4745000 3858000 3036000
Biomass 75000 47000 14000 21000 11000
Solar/Wind 1000 1000 1000 2000 77000
Figure 11. Power Generation in Mindanao per Source from 2012 to 2016
As for Mindanao, the majority of its electricity was sourced from hydropower. This is
no surprise because Mindanao has very extensive river systems, with two (Agusan and
Pulangi) being the largest in the country. However, the coal-fired industry generating 4890000
MWh, overtook this industry in 2016. This major decline in hydropower generation was caused
by the dry weather brought by El Niño. To sustain Mindanao’s electric requirements, its large
coal-fired power plants took over during the latter part of 2016. There was also a leap in 2016
in solar/wind power, and this is because there were two solar power plants commissioned in
the tail-end of 2015. These are the 6.2 MW Centralla Solar and 12.5 MW Kirahon Solar.
The coal-fired generation industry also declined in 2014 because of the Mindanao
Wide Blackout that occurred in February 2014. This damaged the units of the STEAG
Mindanao Coal Fired Power Plant and caused the plant to undergo maintenance for at least
two months. It, however, increased one more in 2015 due to the commercial operation of
Therma South Coal Unit 1.
24
Mindanao Grid Dependable Capacity vs. Peak Demand
3000
2500
Power in MW
2000
1500
1000
500
0
2012 2013 2014 2015 2016
Peak Demand 1346 1428 1469 1517 1653
Figure 12. Mindanao Grid Dependable Capacity vs. Peak Demand from 2012 to 2016
Notably, according to the DOE, Mindanao has a high growth in terms of capacity at
31% from 2015-2016, which is significantly higher than that of Luzon and Visayas, at 11.7%
and 25.7%, respectively. This is due to the commercial entry of more high-capacity coal-fired
power plants. The increase capacity as well in the Mindanao grid can owed to the influx of
embedded diesel power plants in the five-year period. There are also run-off river type
hydropower plants embedded to the distribution utilities. These are important especially during
peak hours as they fill in for the deficiency in supply.
Another interesting note is that Mindanao’s peak demand occurs during the rainy
season (November to December), where the hydroelectric power plants are operating at full
capacity due to the abundant water supply. This is in contrast to Luzon; whose peak demand
occurs during April to May.
Power Transmission
Electric transmission systems are used as interconnections of the electric energy
produced by power plants or generating stations with the loads (or the end-consumer)
(Grigsby, 2007b). The transmission sector transports electricity through high-voltage wires.
The National Grid Corporation of the Philippines (NGCP) is the sole transmission service
provider and manages the operations, maintenance, and development of the country’s power
grid. The transmission system consists of 500 kV, 350 kV High Voltage Direct Current (HDVC),
230 kV, 138 kV, 115 kV, and 69 kV high voltage lines and cables.
Grid Classification
The Philippine transmission system is composed of the Luzon Grid, the Visayas Grid,
and the Mindanao Grid. Currently, while the Luzon and Visayas grids have long been
connected via NGCP’s Naga-Ormoc HDVC line, the two are not yet connected to the country’s
third major grid in Mindanao. However, with the NGCP’s pledge to unify the power grids by
2022, a proposed Visayas-Mindanao connection may ensure that electricity can be distributed
and shared among all the island groups, preventing power shortages when power plants shut
down in one area.
25
The Luzon grid has the largest generation and consumption among the three since
almost 75% of the total generating facilities are from this grid.
Philippine Power Consumption vs. Generation per Grid

80,000,000
70,000,000
60,000,000
Power in MWh
50,000,000
40,000,000
30,000,000
20,000,000
10,000,000
0
2012 2013 2014 2015 2016
Luzon Consumption 53,723,136 55,735,785 57,488,739 61,099,345 67,220,596
Luzon Generation 52,312,426 54,819,517 56,766,481 60,112,863 66,497,549
Visayas Consumption 10,072,003 10,183,326 10,291,667 11,184,002 12,231,839
Visayas Generation 11,482,714 11,099,593 11,013,924 12,170,483 12,954,886
Mindanao Consumption 9,126,871 9,346,731 9,480,592 10,129,866 11,345,457
Mindanao Generation 9,126,871 9,346,731 9,480,592 10,129,866 11,345,457
Figure 13. Power Consumption vs. Generation per grid in MWh from 2012 to 2016
Source: Department of Energy; Refer to Appendix B2, C1,C2,C3
Figure 13 also shows a steady increase of generation and consumption from years
2012 to 2015, but then there is a massive jump in the generation and consumption in the
Luzon grid, as compared to the Visayas and Mindanao grids in the year 2016. This is most
likely due to the increase in infrastructure, development and urbanization of provincial regions,
and overall economic growth in that year, which is most concentrated in Luzon.
26
Company Profile
TeaM Energy, a partnership between Tokyo Electric Power Company and Marubeni
Corporation, is one of the largest power generators in the Philippines, with over 2,000
megawatts of installed generating capacity. It operates two coal facilities in the country: the
735 MW Pagbilao Power Station in Quezon, and the 1,200 MW Sual Power Station in
Pangasinan. Both plants are ISO 14001-certified and continue to comply with the
environmental standards set by the Department of Environment and Natural Resources
(DENR), and the World Bank.
Sual Power Station
Station Capacity: 1218 Megawatts (MW)

Unit Capacity: 2 generators x 609 MW
Operation Mode: Base load
Plant Complex Area: 142 hectares
Ash Disposal Area: 140 hectares
Main Fuel: Bituminous Coal
The Sual Power Station in Pangasinan is the nation’s largest coal-fired power plant in
the Philippines as it has a maximum generating capacity of 1,218 MW. It was built in 1996,
and operations began in October 1999 through a 1,000 MW Energy Conversion Agreement
(ECA) with the National Power Corporation under a 25-year Build-Operate-Transfer (BOT)
contract. San Miguel Energy Corporation (SMEC) is its Independent Power Producer
Administrator (IPPA) and it administers and manages the output from ECA. SMEC also
supplies Sual Power Station’s main fuel – bituminous coal. The station can use up to 10,752
tons of coal per day at full capacity. Currently, it is the largest coal-fired power plant in the
Philippines, and it provides nearly 20% of the power requirement of Luzon.
27
Figure 14. Sual Power Station (Cardinoza, 2014)
Manufacturing Process
Bituminous coal, imported from Indonesia, care of San Miguel Energy Corporation is
unloaded on the jetty, and is transferred to the coal yard, and then to coal bunkers through a
series of conveyer belts. Then then pass through coal mills in order to reduce their size, and
then it is fired in the plant’s furnace via thermal firing, and undergoes combustion. Bottom ash
are collected in silos, and these are brought to the nearby ash disposal area. The flue gas
then passes through an electrostatic precipitator, which acts as a vacuum cleaner by trapping
and removing fine fly ash in the flue gas up to 99.5% efficiency. The trapped fly ash (gypsum
waste) is then collected and is used as raw materials for the manufacture of cement by third-
party companies. Meanwhile, the flue gas exits and passes through the flue gas
desulfurization (FGD) plant, wherein the sulfur oxides fare absorbed using limestone reagent,
before it is released through a 226-meter high chimney. This process reduces the occurrence
of acid rain, and the chimney ensures effective dispersion of exiting flue gas at atmospheric
conditions.
The resulting heat from the combustion is used to heat the water flowing through the
furnace to produce steam. This steam at a very high pressure is used to power a turbine,
which causes large magnets to turn within copper coils (the generator). The moving magnets
cause electrons in the wires to move, creating an electrical current and producing electricity.
The generator produces a voltage of around 22 kV, and this is raised by the transformer to
230 kV so that it can be transported efficiently through the transmission networks to smaller
distribution networks. There is also a step-down transformer for station use.
The water used for the boiler and condenser is sourced from seawater. Pumps bring
the seawater up to the condenser as cooling water, which is then discharged back into the
ocean. Seawater is also subjected to reverse osmosis and demineralization to produce make-
up water for the condenser, and later, for the boiler. This water is passed through a series of
heaters and deaerators before it is fed into the boiler.
The power station also has its own waste water treatment plant, as to essentially treat
all its wastewater before it is re-used or discharged to the sedimentation basins, and eventually
to the sea to prevent water pollution.
These processes will be discussed further in Phase 2 of this paper.
28
Market and Economics Profile
An Introduction on the Raw Material: Coal
Coal is a major part of the country’s energy mix, both in power and non-power use.
Currently, the Philippines has a total of 15 coal basins with total resource potential of 2.4 billion
metric tons (BMT) and in-site reserves of about 407.80 million metric tons (MMT) (Cusi,
2016a). As of 2016, the Power Energy Program Report of the Philippines reports that more
than 70% of the country’s coal supply is directed towards energy generation, while the rest is
for construction material for public and private infrastructure.
Coal Consumption for Power Generation

Source: Department of Energy and Philippine Statistics Authority
30.00
25.00
20.00
Coal in MMT
15.00
10.00
5.00
-
2012 2013 2014 2015 2016
Power Generation 11.94 14.79 15.59 17.55 19.39
Total Coal 15.317 18.952 20.163 22.006 24.794
Figure 15. Total Coal Consumed by Power Generation Sector from 2012 to 2016
Source: Department of Energy, Philippine Statistics Authority; Refer to Appendix G1, G2
It can be seen that the total consumption of coal has increased from 15.32 MMT to
24.79 MMT (61.82% increase) within the five-year period. This is due to the power generation
sector, which accounts for 78.2% of the total consumption as of 2016. Moreover, the demand
for coal in the power generation sector steadily increased between 2012 with 11.94 MMT to
19.39 MMT in 2016 generally because of the installation of seven new coal power plants in
2016 with a dependable capacity totaling 1282 MW.
29
Total 2016 Coal Imports by Country (20.03 MMT)
0% 1% 7%
2%
0% 0%
Australia
China
Indonesia
Korea
Russia
South Africa
Vietnam
90%
Figure 16. Total Coal Imports per Country in 2016

Source: Department of Energy; Refer to Appendix G3
Meanwhile, 90% of the imported coal is sourced from Indonesia, as it is the world’s top
seller of thermal coal used in electricity generation, and it is geographically closer to the
Philippines than other importing countries.
Market Profile
The following figure shows the total power generation in the Philippines as of 2016.
Coal is the obvious main source of electricity, as it accounts for more than half of the total
power generated. This is the case because it is the cheapest and most efficient source of
energy, in terms of technology.
30
Total Power Generation in
the Philippines (82687 MWh)
1%
24%
Coal
Oil-Based
Geothermal
3% 52% Wind/Solar
Natural Gas
Biomass
13%
7%
Figure 17. Total Generation Mix (based on 82687 MWh) in the Philippines as of 2016
To expound as to why coal is advantageous over other sources of electricity is because

of its availability, efficiency, and scale of electricity production. It is unrealistic to say that the
entire country’s electricity can be sourced purely from renewables – that doesn’t just happen
overnight, and it will be very expensive. Unlike other sources, coal has the operating efficiency
to generate power quickly enough for the nation’s demand, and it is also not affected by
weather or mother nature. As Energy Secretary Alfonso Cusi puts it, “as a developing country,
we cannot afford not to have coal.”
With the current pricing regime, which does not include externalities, such as health
and environmental costs, the lower cost power supply option will always be favored. Coal-fired
plants are secure investments, providing continuous revenue streams. These projects are also
more easily constructed and operated compared to the more technology-reliant renewable
energy. Renewables are also considered as high-risk investments because resources would
fluctuate. In the Philippines, also, it is thought that there is not much experience in its
development and operation, so foreign contractors are usually contacted. This makes
renewable energy project costs much more expensive here than in Europe and the United
States (Maniego, 2016).
31
Total Power Generation Mix in Luzon (66498 MWh)
1% 2%
7%
6%
Coal
Oil-based
Natural Gas
50% Geothermal
Hydropower
30% Biomass
Solar/Wind
4%
Figure 18. Total Generation Mix (based on 66498 MWh) in Luzon as of 2016
In Luzon, coal again dominates as it provides 50% of the power generation, as shown
in Figure 18. In Luzon alone, there 12 operating coal-fired power plants. There are even more
coal-fired power plants being planned to be built, such as a $2 billion state-of-the-art, 1000
MW South Korean venture in Sual, Pangasinan.
Total Power Generation Mix in Visayas

(12955 MWh)
2% 6%
0%
Coal
Oil-based
41%
Natural Gas
Geothermal
Hydropower
46% Biomass
Solar/Wind
0%5%
Figure 19.Total Generation Mix (based on 12955 MWh) in Visayas as of 2016

32
Meanwhile, in Visayas, geothermal energy has 46% of the market, while coal slightly
trails behind it at 41%. The geothermal industry most likely emerges as the top energy source
because the islands of Visayas is rich in wet steam-producing fields, even having some of the
largest in the world.
Total Generation Mix in Mindanao (11345 MWh)

0% 1%
27%
Coal
Oil-based
43% Natural Gas
Geothermal
Hydropower
7% Biomass
Solar/Wind
0%
22%
Figure 20. Total Generation Mix (based on 11345 MWh) in Mindanao as of 2016
Lastly, Figure 20 shows the total generation mix of Mindanao in 2016. It shows that
coal provided 43% of the total generation, while hydropower, which is usually the primary
source of energy in Mindanao, accounted for only 27%. This is because in 2016, erratic
weather patterns affected the water reserves used for hydropower; hence, there was a shift
to and a newfound dependence on coal-sourced energy.
Market Dynamics
Market Share and Competition
Figure 21 shows that a majority of coal-generated electricity are from facilities in Luzon,
accounting for a massive 74% in the country’s dependable capacity. Visayas and Mindanao
have roughly an equal share on the dependable capacity of the Philippines, with around 13%
each.
33
Dependable Capacity Mix of Coal in the Philippines
(7674 MW)
13%
13%
Luzon
Visayas
Mindanao
74%
Figure 21. Dependable Coal Capacity Mix (based on 7125 MW) in the Philippines as of December 2017
Luzon has the highest capacity, simply because it has the most coal power plants
(twelve), whereas Visayas and Mindanao both have four coal power plants each as of 2017.
The following figures display the dependable capacity mix of coal power plants
connected to their respective grids. All figures will represent available data from June 2017,
care of the Department of Energy.
Coal Power Plant Dependable Capacity Mix in Luzon

(5304 MW)
1% 1%
0%
11% Anda Power Corp.
24% APEC
SEM Calaca Power Corp.
11% GN Power
Masinloc-Power Partners
TLI
5% QPPL
12% SCPC
6% SLPGC
SLTEC
6%
SMEC
9% 14%
Figure 22. Coal Power Plant Dependable Capacity Mix (based on 5304 MW) in Luzon as of December 2017
Source: Department of Energy; Refer to Appendix E1
34
Leading the coal-fired industry in Luzon is SMEC with the Sual Power Station, as it
boasts supplying 24% of the coal-sourced energy for the Luzon grid. It is also to be noted that
Sual Power Station is also the largest electricity generator in the entire country. The Pagbilao
plant in Quezon of TLI provides about 11% of the grid’s capacity from coal.
With twelve coal power stations (each with its own IPPA), the Luzon market for coal-
sourced electricity is the most “competitive” in the whole scheme of things.
Coal Power Plant Dependable Capacity Mix in Visayas

(904.4 MW)
27%
35%
GBPC - Cebu
KepCo-Salcon
PCPC
GBPC - Panay
23%
15%
Figure 23. Coal Power Plant Dependable Capacity Mix (based on 904.4 MW) in Visayas as of December 2017
Compared to the capacity mix in Luzon, the Visayas grid is not as competitive as the
Luzon grid. Visayas only has four major on-grid coal power plants with four different IPPAs,
which is actually the minimum according to EPIRA in order to allow competition GPBC – Panay
has the largest share, with PEDC Coal providing 35% of the capacity mix.
35
Coal Power Plant Dependable Capacity Mix in Mindanao
(965 MW)
27%
37%
FDC Utilities
PSALM
SCPC
TSI
14%
22%
Figure 24. Coal Power Plant Dependable Capacity Mix (based on 965) in Mindanao as December 2017
Lastly, the market in Mindanao similar to Visayas with regards to competition as there
are four IPPAs with relatively well-dispersed shares, with FDC Utilities having the largest share
with its 360 MW station in Misamis Oriental. Also, it can be observed that SPCP also has a
share in the Mindanao market, as it does in Luzon. It appears to be the only IPPA with grasps
in more than one region. Meanwhile, it is also observed that Mindanao is the only region with
a PSALM-managed power station.
Power Distribution
Once the power generated is transmitted through the transmission lines, the
distribution utilities transform high-voltage electricity to lower voltage wires with the end goal
of supplying individual customers. It is handled by private distribution utilities (PUDs), electric
cooperatives (ECs), and local government units, among others, as regulated by the Energy
Regulation Commission (ERC).
MERALCO is the country’s largest distribution utility serving over 6 million customers
in a franchise area covering 9,685 km2 across Metro Manila, Bulacan, Cavite, Rizal, Laguna,
Quezon, Batangas, and Pampanga.
Sector Classification
The sectors wherein power is being distributed to or used by are classified into the
following: residential, commercial, industrial, transportation, utilities (own use), power losses,
and others.
The residential sector includes all houses and housing facilities, including subdivisions
and villages. The commercial sector is composed of facilities and equipment that provide
services, such as government facilities, shopping malls, and schools. The industrial sector is
composed of small to large scale industries that are involved in manufacturing and
construction. The transportation sector includes, of course, modes of transportation (railway,
road, water, air), while the utilities (own use) sector deals with power used up by power-
generating units for their own equipment, facilities, and processes. The power losses
36
classification is can be attributed to system losses from inefficient transmission lines, towers,
transformers, and other equipment.
Total Philippine Power Consumption per Sector

30,000,000
25,000,000
Power in MWh
20,000,000
15,000,000
10,000,000
5,000,000
-
2012 2013 2014 2015 2016
Residential 19,694,896 20,613,717 20,968,872 22,747,000 25,631,000
Commercial 17,777,222 18,303,747 18,760,787 20,085,000 21,770,000
Industrial 20,070,972 20,676,799 21,428,667 22,514,000 24,119,000
Transport 116,726 112,241 111,024 98,000 102,000
Others 1,550,801 1,859,108 2,075,435 2,364,000 2,532,000
Utilities (Own Use) 5,351,152 5,959,405 6,645,831 7,124,000 8,357,000
Power Losses 8,360,241 7,740,825 7,270,381 7,481,000 8,286,000
Figure 25. Total Philippine Power Consumption per Sector from 2012 to 2016
Increasing growth trends of electricity sales and consumption were observed from
2012 to 2016, with the residential sector overtaking the industrial sector’s consumption. The
increasing access of electricity of the population, in addition to the rising real income per capita
over the years allowed households to buy basic commodities, including electricity (Cusi,
2016b), led to an increase in consumption for the residential sector.
The increasing growth in consumption in the industrial sector is due to the strong
performance of both the domestic and export manufacturing of electronics, automotive parts,
metals, pharmaceutical goods, paper, plastic, textile, and food products, as well as the
increase in public and private construction.
Meanwhile, despite the “others” sector having the smallest market share, it still had a
steady growth elevated by the increase in government spending for the provision of goods
and services to stimulate the country’s growth. The improvement of agricultural and fishery
technologies also contributed to the growth of this sector. The growth rate, on the other hand,
of power consumption by the utilities (own use) sector can be attributed to the massive entry
of private power generation plants over the years.
Regional Data
Coal is the most abundant fossil fuel in Southeast Asia, with reserves concentrated in
Indonesia and Vietnam. In general, however, Indonesia’s coal is more suited for power
37
generation. Due to its abundance, as well as its relatively cheaper cost, it emerges as the fuel
of choice in the region.
Country Ranking in ASEAN:

Coal-Fired Power Generation
Source: World Bank
Others 1.7016
Philippines 33.0844
Vietnam 34.5205
Thailand 37.4976
Malaysia 55.9025
Indonesia 120.2436
0 20 40 60 80 100 120 140

Power in TWh
Figure 26. Total Coal-Sourced Power Generation in ASEAN by Country

Source: World Bank; Refer to Appendix F2
The “others” portion consists of Singapore, Myanmar, Laos, and Brunei. These
countries do not use a significant amount of coal-sourced electricity.
The International Energy Agency also expects the coal demand to jump sharply, from
a 16% share of the primary energy mix in 2011 to 28% in 2035, which is consistent with the
trend in the recent decades of China and India, which are some of the greatest coal consumers
in the world. This may be counterintuitive, compared to the shift away from coal in most
regions, but this trend is consistent with what has happened during periods of rapid economic
and energy demand growth in other major developing countries in Asia, like China and India.
Global Data
According to the World Energy Resources report of 2016 by the World Energy Council,
the global coal production in 2014 was approximately 5.7 BMT, 77% of which was used for
power generation. It currently fuels 40% of the world’s electricity, and it is forecasted to
continue to supply a strategic share over the next three decades.
38
Country Ranking: Coal-Fired Power Generation
Source: World Bank
Philippines 33
Turkey 74
Afghanistan 77
Ukraine 80
United Kingdom 97
Indonesia 110
Taiwan 120
Poland 130
Australia 152
Russia 156
South Korea 211
South Africa 237
Germany 263
Japan 299
India 868
USA 1711
China 4090
0 500 1000 1500 2000 2500 3000 3500 4000 4500
Power in TWh
Figure 27. Coal-Fired Power Generation by Country (2016)

Source: World Bank; Refer to Appendix F2
China has the largest coal-fired power generation in the entire world with 4090 TWh,
even if the demand of coal fell by 2.9% to 3.9 BMT. The main driver of its large power
generation is the development in the industrial sector, which accounts for the bulk of electricity
consumption in China, in contrast to the United States and to the European Union, whose bulk
of electricity consumption comes from residential and commercial sectors. The United States
lags at a far second with 1711 TWh of power generated from coal, but this demand also is
less than prior years mainly due to the increasing competition from natural gas, political
opposition, and more environmental regulations.
The Philippines ranks 24th in the world in terms of coal-fired power generation;
however, in Figure 27, it is only listed with the top 16. Generally, the top users of coal-fired
generation are highly-developed and developing countries, as according to the World Energy
Council, electrification would simply not be possible without coal-fueled power plants. Its role
in the electricity system is important, even ending the so-called “electricity poverty” for billions
and contributing to economic development.
The Kraftwerk Neurath Facility in Germany shall be used to illustrate the contributing
element of power stations. The development of this power station added more than 7.2 billion
USD to the local economy, as shown in Table 1.
39
Table 1. Economic Impacts of Neurath Facility in Germany
Source: World Energy Council
Operation and
Construction (million
Maintenance (million USD
USD, 2006-2012)
per year)
Direct Economic Impact 3469 70
Indirect Economic Impact 2773 34
Induced Economic Impact 1000 12
Total Impact 7242 116
Figure 28. Neurath Power Station

Source: RWE Generation
Economic Outlook and Forecasting

In general, the Department of Energy predicts that the peak demand of the Philippines
is to increase to 49285 MW by 2040 – nearly four times more than the peak demand of 2016
(Cusi, 2016b). This would imply an average 6% annual growth rate until 2040, and on a per
grid basis, there would be a 5%, 7%, and 8%, annual average growth rate for Luzon, Visayas,
and Mindanao, respectively. Figure 29 shows the grid peak demand forecast for the next five
years.
Grid Peak Demand Forecast

Source: Power Development Plan 2016-2040
20000
18000
16000
Power in MW
14000
12000
10000
8000
6000
4000
2000
0
2018 2019 2020 2021 2022
Luzon 10368 10895 11451 12000 12579
Visayas 2143 2298 2465 2633 2812
Mindanao 2064 2229 2407 2588 2782
Philippines 14575 15422 16323 17221 18173
Figure 29. Grid Demand Forecast from 2018 to 2022
Source: Department of Energy; Refer to Appendix F1
40
Total Coal Dependable Generating Capacity
8000
7000
6000
Power in MW
5000
4000
3000
2000
1000
0
2012 2013 2014 2015 2016
Total 5206 5206 5378 5613 6979
Figure 30. Total Coal Dependable Generating Capacity in the Philippines from 2012 to 2016
Source: Department of Energy; Refer to Appendix E1, E2, E3
Figure 30 shows that the capacity of coal-fired power plants in the country increases
every year. The rise from 2012 to 2015 was relatively steady at 3-4%, and it jumped to a 25%
growth in 2016. Thus, with a predicted increase in electricity demand, so will the trend of coal
dependence, as BMI predicts it to remain as the country’s primary energy source for the next
ten years. The group even predicts that coal’s dominance will extend to Visayas and
Mindanao, whose electricity mixes have so far been dominated by renewable energy sources,
such as geothermal and hydropower, respectively.
The US consultancy firm, IHS Markit, also predicts that coal will rise to 56% of the
power mix by 2020, as there are 23 new coal-fired power plants lined up for commercial
operation within the next five years, and another 10423 MW of coal projects in 2025 through
private and foreign investments. Some of the developing coal-fired power generating facilities
include a 600 MW plant in Subic, the expansion of the Bataan power plant from 600 to 900
MW, two new 300 MW plants in Davao City, and a 400 MW expansion of existing facilities in
Quezon province.
It must be noted, however, that currently, Philippine coal reserves meet just a fraction
of requirements and thus imports 70% of coal from neighboring countries like Indonesia. And
as of 2016, government spending on coal amounts to more than $1 billion, and perhaps now,
with the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) Law,
spending on imports will continuously increase. Nevertheless, it is also predicted that the
estimated domestic coal production is to grow by an annual average of 4% by 2020. With this,
the Philippines will reduce its dependence on imported energy sources and make use of locally
available reserves. Thus, coal prices are expected to stabilize, and this type of power source
will remain cost-competitive, but other alternative energy sources are to be exploited as well,
especially renewables. Reynaldo Casas, President of the Confederation of Solar Power
Developers in the Philippines, even emphasizes that increasingly, “renewable energy is
drastically becoming cheaper and… the rapid pace of developing renewable energy
technology is ushering a possible era of clean, sustainable energy for all.”
41
The DOE suggests a fuel-mix policy that that at least 30% of the power generation
capacity is from renewable energy. Another 30% each for coal and for natural gas, while the
balance is oil-fired. However, this is still in review, and industry stakeholders like MERALCO
and Aboitiz Power Corporation continuously ask the government for clearer policies on the
country’s power generation requirements. Investors in the Philippines would want to be table
to develop a clear policy that identifies the power demand, supply deficit, and even the type
of fuel source needed.
Projected Electricity Demand Per Source

Source: ExxonMobil
Net Electricity in TWh
Figure 31. Projected Electricity Demand per Source

Source: ExxonMobil 2017 Outlook for Energy; Refer to Appendix F3
ExxonMobil, a leading gas and oil corporation, reports the projection as shown in
Figure 31 (ExxonMobil, 2017). The world will begin to shift to less carbon-intensive energy for
electrical generation, but it will still primarily be dominated by coal, followed by natural gas,
renewables, and nuclear energy, while oil will continue to steadily decline.
Ultimately, following the predicted trends, coal will prevail as the economical electricity
source of choice up to the near future despite environmental qualms while the renewable
energy sector is being developed in the country. It is predicted also that oil’s share in electricity
generation will remain low, with a bulk of that portion coming from production supplied by
“auto-producers” – generators whose primary activity is not public electricity supply. This is
partly because of the ability to use oil in smaller generation plants without the costly material-
handling systems of coal.
Laws and Policies

EPIRA
The Electric Power Industry Reform Act (EPIRA) was enacted with the intention of
ensuring affordable and reliable electricity to the country. This involved reforming,
restructuring, and deregularizing the power industry, and the privatization of most state-owned
power generators and transmission assets. The reforms were meant to introduce more
42
competition and choices for consumers, while at the same time, leveling the playing field to
encourage greater private sector participation.
Through EPIRA, the monopoly of the government-owned National Power Corporation

(NPC) was dismantled through privatization, and the power industry became segmented into
four competitive sectors: generation, transmission, distribution, and supply. Meanwhile, the
Energy Regulatory Commission was formed to protect consumers as a regulator. The
Department of Energy serves as the policy-makers and promoters of energy supply
development, and it provides a competitive market through the wholesale energy spot market
(WESM).
Renewable Energy Law

The Renewable Energy (RE) Law, approved last December 16, 2008 aims to promote
the development, utilization, and commercialization of renewable energy resources. This
provides the framework of legal and institutional conditions for the private sector to implement
RE technologies into the market, as well as policies to create markets. It also aims to ensure
a fair rate of return for investors in the RE sector (Department of Energy, n.d.).
The RE Law promotes a feed-in-tariff (FIT) scheme, which sets a fixed price for
electricity sourced from renewable energy for 12 years, and this is envisioned to be linked to
and be a function of the WESM. The law also introduces the “Green Energy Option”, which
gives consumers the choice to use RE. In essence, this accelerates the open access concept
under EPIRA. With this law, the DOE is also mandated to reduce the country’s dependence
on fossil fuels.
TRAIN Law
The Department of Finance states that the Tax Reform for Acceleration and Inclusion
(TRAIN) Law is “first package of the comprehensive tax reform program of the Duterte
administration.” This aims to correct the deficiencies and lapses in the tax system to make it
“simpler, fairer, and more efficient.” An effect of the TRAIN Law is that it will raise the tax on
coal from 19 cents (10 PHP) per metric ton previously, to 96 cents (50 PHP) per ton this year.
The coal tax would rise further to 1.92 USD (100 PHP) per ton in 2019, and to 2.88 USD (150
PHP) per ton in 2020. The implementation of the law also re-imposed the value-added tax
(VAT) on wheeling charges, which are collected by NGCP from distribution utilities to cover
the services for electricity transmission.
According to MERALCO, this may affect consumers’ electricity bills as they will see a
monthly rise by 15 cents (8 Philippine centavos) per kilowatt-hour (kWh) as an immediate
impact of the new tax regime. This means that a typical household that uses 200 kWh will pay
31 cents (16 PHP) more for electricity services.
43
PHASE II – Plant Operations
44
Raw Materials
Coal
General Description
The World Coal Organization describes coal as a fossil fuel from the altered remains
of prehistoric vegetation. These remains underwent a process of coalification, wherein high
temperatures and pressures caused physical and chemical changes until it was transformed
into the coal we know today. Coalification has an important bearing on the coal’s physical and
chemical properties and is referred to as the “rank”. These ranks are determined by the extent
of transformation of the original plant material to carbon. The ranks of coal, from lowest to
highest carbon content, are lignite, sub-bituminous, bituminous, and anthracite. There is a
simpler rank of coal – peat. However, peat is not typically classified as coal because it is not
a rock and the unconsolidated plant matter is lacking the metamorphic changes found in coal.
Figure 32. Types of Coal
Coal Ranks
Lignite
Lignite (brown coal), the least mature of the coal types, has about 20% to 35%, and
has the lowest energy density of around 17 MJ/kg. It is estimated that nearly half of the world’s
coal reserves are made up of lignite and sub-bituminous coal; however, lignite has not been
exploited to a great extent since it has a low energy density, difficulty in handling, and storage
stability.
Sub-Bituminous
Sub-bituminous coal or soft coal contains 35% to 45% carbon and 15% to 30% water
and has energy densities ranging from 19 MJ/kg to 26 MJ/kg. It also has a low sulfur content
(often less than 1%). These types also burn well, thus making them a suitable fuel for power
plants, but since they have a much lower energy density than bituminous coal, more of this
type must be burnt to obtain the same amount of energy. However, due to environmental
concerns, some coal-fired power plants are switching from bituminous coal to sub-bituminous
coal because of the lower sulfur content.
Bituminous Coals
The most abundant form of coal are bituminous coals, also called soft coals. These
have a carbon content between 45% and 70%, a moisture content between 5% to 10%, and
significant amounts of volatile matter. Bituminous coal has an energy density ranging from 24
MJ/kg to 33 MJ/kg, and they can be burnt easily, especially when they are subject to size
reduction processes, such as grinding and pulverizing. These types of coal are ideal for power
station fuel. The bituminous coals suitable for power generation are called steam coal or
thermal coal.
45
Bituminous coal also contains pyrite, which can serve as host for impurities like arsenic
and mercury. The combustion of bituminous coal can thus release traces of mineral impurities
into the air as pollution.
Sual Power Station uses bituminous coal as their fuel source for power generation.
Anthracite
The hardest type of coal is anthracite. It contains the highest percentage of carbon (up
to 98%) and very little volatile matter or moisture. When it is burned, it produces very little ash
and relatively low levels of pollution. It also has a relatively high energy density compared to
other types of coal, at 23 MJ/kg to 33 MJ/kg.
Despite its high energy content, it is slow-burning and difficult to fire in power station
boilers unless it is used in tandem with another fuel source; thus, it is not usually used in the
industrial setting. However, it is becoming a common fuel in Russia and Ukraine, as these
countries have large reserves.
Coal Preparation
Although not done by the plant, the coal is cleaned and processed to improve its
quality, both economically and environmentally, before it is used. Typically, methods of coal
cleaning focus on removing excess moisture and reducing the amount of incombustible
material, which would otherwise remain as ash after combustion. Coal moisture is removed
by drying. It reduces the coal’s weight and volume, making it more economical and cheaper
to transport, and also, quicker to burn.
Coal Storage
Sual Power Station has thermal bituminous coal delivered two to three times a month
by coal-carrying barges to their jetty port care of their IPPA, San Miguel Energy Corporation.
The crates of coal are unloaded onto the compound, and are then transferred to their open-
air 7-hectare coal yard about a kilometer away via high-capacity trucks.
Because coal has the tendency to self-heat, followed by spontaneous ignition and
combustion, the plant observes several precautionary measures, and the stockpiling of coal
has to be done consciously and responsibly. Some rules of thumb are the following:
1. The coal is stored in several small piles rather than one large one. This is to prevent
temperature buildup and to facilitate manual inspection.
2. The stockpiles are not more than 12 feet, and should each contain, at most, 1500
tons of coal.
3. The power plant sprinkles water on the stockpiles at certain intervals to further
prevent temperature buildup.
The power station’s coal yard is also installed with high density polyethylene (HDPE)
liner to prevent ground water contamination.
Fuel Oils
Fuel oil, or furnace oil, consists mainly of residues from crude-oil distillation. These are
primarily used for steam boilers in power plants. For the Sual Power Station, however, fuel
oils are only used as secondary fuel for boiler unit light up and shut down procedures.
Types of Fuel
Heavy Fuel Oil (HFO)
HFOs are fuels that have a particularly high viscosity and density. In the MARPOL
Marine Convention of 1973, HFO is defined by a density of greater than 900 kg/m3 at 15°C,
or a kinematic viscosity of more than 180 mm2/s at 50°C.
46
Light Fuel Oil (LFO)/Light Diesel Oil
Light diesel oils are a blend of distillate fuel with a small proportion of residual fuel.
Economics
Table 2 summarizes the amount of coal, LFO, and HFO used by Sual Power Station
in fiscal year 2014 to 2015.
Table 2. Raw Materials Used (April 2014-May 2015)

Source: Team Energy Sustainability Report 2015; Refer to Appendix H1
Raw Material Unit Amount

Coal MT 2878136
HFO m3 2622.52
LFO m3 143.67
All of the raw materials of Sual Power Station are provided by its IPPA, San Miguel
Energy Corporation. Thus, the representatives of the company could not impart any
information regarding the costs of their raw materials; they only stated that their bituminous
coal is imported from Indonesia. However, costing analysis (with prices based on World Bank
data) can be done based on the amount of raw materials used, which is provided in Table 2.
Table 3. Cost Analysis of Raw Materials
Raw Material Price (USD) per Unit Price (USD)

Coal 60.12 173033536.32
HFO 0.95 2491394.00
LFO 1.06 152290.20
Total 175677220.52
The calculations above do not include the taxes of imported materials.
47
Manufacturing Process
Sual Power Station Process Overview
Figure 33. Sual Power Station Process Flow Diagram

Figure 33 shows the complete process flow diagram of the Sual Power Station for
electricity generation.
Feed Water Pre-Treatment

Coal-fired thermal plants involve water-intensive operations, and Sual Power Station
utilizes sea water for its processes. It is important to note that water has metallic materials that
may corrode equipment at high temperatures and pressures, thus feed water must be highly
purified before use.
Seawater from the inlet basin passes through a series of three band screens to remove
and separate any debris, solids, marine life, etc., from the water. A seawater intake pump then
transports the seawater into the reverse osmosis plant, where it undergoes double pass
reverse osmosis so that the seawater, from 50000 µS/cm is reduced to 1000 µS/cm in the first
pass, then to 20 µS in the second pass. It then passes through the ion exchange
demineralization plant to produce water with a conductivity of 0 to 0.5 µS/cm. This water is so
pure that coincidentally, it can become electrical.
The feed makeup water enters the condenser with condensate water being pumped
out of the equipment after travelling through the steam turbines. It then flows through seven
intermediate preheaters (4 low pressure and 3 high pressure), heated at each point with steam
extracted from an appropriate duct on the turbines and gaining temperature at each stage.
The total feed water then flows through a spray and tray type deaerator that removes
dissolved air from the water, further purifying and reducing the potential for corrosion. The
water is dosed with hydrazine to scavenge the remaining oxygen in the water to a level less
than 5 ppb, and it is also dosed with pH controlling agents to maintain a low level of acidity,
which reduces any potential for corrosion (Speight, 2013).
Table 4 summarizes the amount of process water, as well as the cooling water and
utility water, withdrawn from Pao Bay for industrial and domestic use. The cooling water
accounts for 99.9% of the water withdrawn.
Table 4. Total Water Withdrawal (April 2014 to March 2015)

Water Source Volume (m3)

Process Water Pao Bay 1164796.97
Cooling Water Pao Bay 1766016000.00
Domestic Use Pao Bay 127055.20
Total 1767307852.17
Coal Preparation
Figure 34. Sample Coal Bunkers

Source: http://keepprojects.in/project/vandana-vidhyut-ltd
From the coal yard, the coal is transferred via conveyor belts to the coal bunkers.
These are process storage silos used for storing coal. In total, there are eight bunkers – four
on each side of the boiler. The coal from the bunkers then enter four horizontal ball mills
through coal feeders by gravity action, so that they may be pulverized in preparation for firing.
In practice, less than 2% of the total coal volume should be greater than 300 microns, while
70% to 75% is below 75 microns. It should be noted that too-fine powders would exhaust too
much grinding mill power, while too coarse coal will not burn completely later on in the
combustion chamber. Through primary air fans, the pulverized coal is transported from the
mills to the boiler for combustion. These fans are designed to handle atmospheric air up to a
temperature of 50°C.
Steam Generation
Each boiler unit is a two-pass controlled circulation pulverized coal-fired (PC) boiler,
coupled with a forced draft fan used to supply the air needed for combustion to be achieved.
Figure 35. Cross Section of a Pulverized Coal Boiler

Source: Introduction to Electricity Generation by Breeze, P. (2014).
50
The deaerated feed water at 272°C, composed of recirculated condensate water and
purified makeup water, enters the economizer, where it preheated by the combustion flue
gases. This raises the temperature of the feed water without requiring more energy input. It
then flows into the boiler steam drum at the top of the furnace. Water from the drum circulates
through the boiler tubes in the furnace walls using the density difference between water and
the steam drum and the steam-water mixture in the boiler tubes. The PC boiler combusts a
suspension of finely-ground coal, blown into the furnace by fans in a gaseous matrix to form
a large sustainable flame vortex. It makes use of the tangential firing system, wherein four
burners that are corner-to-corner create a “fireball” or a “vortex” at the center of the furnace.
The flame envelope rotates, and ensures thorough mixing within the furnace, providing
complete combustion and uniform heat distribution. This method is advantageous because it
is very rapid, and the flame lengths are short, so as to avoid damage to the water wall pipes
inside the boiler (Khan, 2014).
The heat released during the combustion process is partially radiant and partially
convective. The radiant heat is captured by water running in pipes within the boiler walls, and
more tubes are placed in the path of the flue gases exiting the furnace. As water passes from
one set of tubes to another, its temperature rises, and steam is generated. The design of the
furnace also efficiently utilizes the concentrated heat released from the combustion of coal to
generate the most steam production (Speight, 2013).
Figure 36. Sual Power Station Boiler (Unit 1)
Each boiler unit uses a low circulation ratio for the water-wall tubes. The furnaces are
of the balanced draft type, the high and intermediate temperature superheaters are vertical
pendants, the low temperature reheater is a radiant wall type, and the high temperature
reheater is a vertical pendant type. There are also eight levels of corner firing tilting tangential
burners. The boiler system of Sual reaches up to a temperature of 1051°C. To minimize
nitrogen oxide production, the amount of air entering the combustion chamber is restricted,
maintaining a chemically reducing atmosphere in which virtually all the oxygen is captured
during carbon combustion, leaving none to react with nitrogen (Breeze, 2014).
Furthermore, it produces a boiler maximum continuous rating (BMCR) steam flow of

1990 tons/hour at 180 bar and 538°C, with 1698 tons/our reheat steam at 40 bar and 538°C.
The exiting flue gas temperature is 127°C.
51
Figure 37. Schematic of a Steam Turbine
The high pressure, high temperature steam generated from the boiler flows into the
turbine. At the other end of the steam turbine is the condenser, which is maintained at a low
temperature of 30°C and a pressure of 83 mbar. The steam from the high-pressure boiler to
the low pressure causes the turbine blades to rotate at a high speed of 3600 rpm. A generator
is mounted at one end of the turbine shaft and consists of carefully wound wire coils. Electricity
is generated when these are rapidly rotated in a strong magnetic field. The rotor of the
generator spins in a sealed chamber cooled with hydrogen gas. Hydrogen gas is used
because it has a low viscosity and has the highest known thermal conductivity. The electricity
generated has a rated power of 647 MW and a rated voltage of 22 kV. It then flows to a
distribution yard where three-phase transformers step the voltage up to 230 kV for economic
and efficient transmission through power line grids.
The turbine is equipped with a control valve that regulates the steam flow in
accordance with the 647-MW power output needed. The exhaust steam returns to the boiler’s
reheating tubes, where it is reheated back to 541°C before it flows into the turbine once more.
A small fraction of the steam from the turbines is also used to heat the deaerator and the boiler
feed water preheaters.
Steam Condensing
The exhaust steam from the turbines is condensed into water in the plant’s titanium,
seawater-cooled condenser, which is of a shell and tube heat exchanger design. The
condensate from the bottom condenser is pumped back to the deaerator to be reused as feed
water. Up to 50400 m3/hour of cooled, filtered seawater is pumped into the condensers as
cooling water. This cooling water used to condense the steam is then returned to the ocean.
Beforehand, however, it is mixed with cool water to lower its temperature in order to prevent
thermal shock to aquatic life once it is discharged into the ocean. Temperature readings at the
intake and outfall are taken daily to determine the temperature increase in the water, thereby
preventing any thermal impact to the marine environment. The temperature difference
maintained by Sual Power Station is below 3°C.
By-Products and Further Processing

The by-products of the combustion process of coal includes bottom ash, fly ash, and
flue gas. The bottom ash, the heavier portion of the coal ash (residuals from combustion)
basically settles on the bottom of the boiler instead of floating in the stack gases. Boiler slag
52
is often included in the bottom ash. This bottom ash is just collected and transported to the
power station’s 140-hectare ash disposal area, since it would be toxic when recycled.
Physically, fly ash is a very fine, powdery material composed mostly of silica; nearly
all of its particles are spherical in shape, and its consistency is somewhat like talcum powder.
This product of burning is removed from the plant’s stack gases primarily by an electrostatic
precipitator, which acts as the station’s “vacuum cleaner”.
Figure 38. Electrostatic Precipitator (Sample)

Source: http://ecomak.co.in/proucts/electrosatic-precipitator.html
It collects fine particulates of matter (dust) and is capable of reducing the amount of
submicron particles, and even have the capacity to collect liquid mist in addition to dust. It
utilizes a system of plates and wires to apply a large voltage across the flue gas as it passes
through the precipitation chamber. This causes an electrostatic charge to build up on the solid
particles in the flue gas, and in effect, these are attracted to the oppositely charged plates of
the device, where they are collected. Sual Power Station is equipped with one that is 99.5%
efficient in collecting particulate matter.
Fly ash is a pozzolan, a siliceous material that, in the presence of water, will react with
calcium hydroxide at ordinary temperatures to produce cementitious compounds. Thus, the
fly ash produced is useful in cement and concrete applications. The fly ash produced in the
power station is thus collected in silos and is sold to Eagle Cement.
Furthermore, after the removal of the fly ash via the electrostatic precipitator, the stack
gases pass through the station’s flue gas desulfurization (FGD) plant, which is actually the
first of its kind in the Philippines.
53
Figure 39. Schematic of a Flue Gas Desulfurization Tower
The desulfurization process (also called wet scrubbing) introduces a spray of alkaline
sorbent (primarily limestone) into the exhaust gas. The alkali reacts with the sulfur dioxide to
form calcium sulfite or calcium sulfate and is allowed to settle out. The rest of the water is
recycled, as is the slurry containing gypsum and unreacted limestone that is collected at the
bottom of the chamber. The FGD plant achieves 99% sulfur dioxide removal. Afterwards, to
ensure the effective dispersion of exiting flue gas in atmospheric conditions, it passes through
the station’s 226-meter high chimney. The chimney is installed with a continuous emissions
monitoring system and a continuous opacity monitoring system to monitor the plant’s
emissions.
Figure 40. Sual Power Station's 226-m Chimney

Source: TeaM Energy Sustainability Report 2015
At full capacity, Sual Power Station can process up to 10752 tons of coal every single
day. That is, the coal flow rate is 244 tons/hour per unit.
54
Wastewater Discharge and Treatment
The generated wastewater from plant operations are pumped into the in-house
wastewater treatment plant or catchment basins prior to discharge to the ocean. The plant has
six different types of water discharges, enumerated as follows:
1. Effluent from chemical treatment

2. Storm drains collecting pond
3. Treated effluent coming from the main plant and accommodation’s area
4. Discharge from sanitary landfill
5. Cooling water discharge
6. Reverse osmosis (RO) brine reject discharge
The effluent from the chemical treatment and storm drains are treated in the plant’s
wastewater treatment plant via sedimentation basins. Meanwhile, the treatment effluent
coming from the main plant is directed to a local sewage treatment plant lagoon, while the
discharge from the sanitary landfill is transported to a wetland. The cooling water discharge
and the RO brine reject are discharged into Pao Bay.
It is interesting to note that out of their annual use of 2.61 billion cubic meters of water,
only 0.1% is actually converted to steam or wastewater in the electricity generation process,
while 99.9% passes through as cooling water in a circulation system which reverts water back
into the ocean.
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Process Controls
Figure 41. Sual Power Station Control Room Simulator
The Sual Power Station’s logic control, analog control, and data acquisition are all
executed using an advanced distributed control system (DCS) engineered by Cegelec’s
Power Instrumental Control division from the United Kingdom, namely the Alspa 8000-P320
system. It has three sub-systems: Centralog, Controbloc,a and Controcad.
In addition, decentralized operations, such as water treatment, coal and ash handling,
and cooling water pump houses are controlled via local panels that have minimal status
information provided to the DCS via serial links or hardwired connections, as appropriate.
The turbine safety and governing system is performed by the turbine supplier or other
third-party companies, but its start-up system is supervised by the DCS.
Centralog
Generally, Centralog provides operator control interface and a control room
environment. The management of the power station is operated using P320 workstations in
the main control room, and it is equipped with two separate Centralog systems so that the
operator has access to both Units 1 and 2.
For Sual, Optiplant, an optimized package for power plants, is used to calculate the
following parameters:
1. Gross turbine heat rate and efficiency
2. Unit gross heat rate and efficiency
3. Steam generator efficiency
Controbloc
Controbloc links geographically separated automation cells. With this, each controller
is capable of executing any of the available control functions, like digital control/sequencing,
analogue control, etc.
Controcad
Lastly, Controcad provides engineering tools for the design office and on-site
documentation. It includes developed control schemes and operator screen displays that use
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functional blocks (including automation and supervision data). This facility is also used for
automation schemes for plant training simulators.
Continuous Emissions Monitoring System

A Continuous Emissions Monitoring System (CEMS) is installed in the plant’s chimney
to monitor sulfur oxides (SOx), nitrogen oxides (NOx), and opacity in the flue gas 24 hours a
day, 7 days a week.
In the Sual Power Station, the following table shows the emissions in kilograms
recorded by CEMS in fiscal year 2014-2015.
Table 5. Emissions of Sual Power Station

Emissions Amount (kg)

Sulfur Dioxide 23433081.96
Nitrogen Oxide 9434764.58
Particulate Matter 283429.83
57
Equipment Design and Safety
The following is a run-down of the available specifications of the equipment in the
electricity generation of the Sual Power Station. These were lifted from the TeaM Energy
website. Information on other equipment was withheld.
Equipment Specifications
Coal Mill
Type: Four horizontal ball and tube mills
Size: BBD 4366 (Broyer-Boulet-Direct Firing, 43 dm shell diameter, 66 dm shell length)
Boiler
Brand: Stein
Type: Two-pass drum type with forced circulator
Max. Continuous Rating: 1990 t/h
Operating Pressure: 180 bar
Operating Temp: 538°C
Firing System: Pulverized Coal Firing
Draft System: Balanced Draft
Installation: Outdoor
Condenser
Brand: Alstom
Type: Shell and Tube
Operating Pressure: 83 mbar
Cooling Water Temperature: 30°C
Turbine
Brand: Alstom
Type: Tandem coupled, single reheat
Max. Continuous Rating: 647 MW
Operating pressure: 175 bar
Operating Temp: 540°C
Rotating Speed: 3600 rpm
Generator
Brand: Alstom
Type: Compound Wound
Rated Output: 647 MW
Rated Voltage: 22 kV
Rotating Speed: 3600 rpm
Chimney
Designer: OveArup & Partners
Flue Lining: Pennguard
Height: 226 m
Safety Engineering and Maintenance

The maintenance practices of a power station are different from those of traditional
industries because power plants require to be run continuously. Sual Power Station, being a
base load facility, runs 24 hours a day, 7 days a week. Maintenance can cause outages of
equipment, and duration of outages for maintenance is restricted by market demand.
58
Furthermore, being an energy generation facility, its maintenance practices do not only have
to address the equipment conditions, but also to mitigate losses.
The structures of the plant were built in the 1990s and had been operating for nearly
20 years. For the aging plant, TeaM Sual had shifted from the maintenance strategy of
preventative to predictive maintenance approach. Predicative maintenance encompasses
condition monitoring, condition assessment, and decisions regarding when and what
maintenance should be performed to restore equipment capability to the desired condition
(Chanda, 2016). In 2014, they employed Aging Plant Strategies, like mid-life assessment
programs, life extension programs, risk-based maintenance approach, performance-based
approach, and root cause analysis approach. They had also started the predictive forecast
approach based on statistical analysis. These techniques determine the task and timing of
major equipment maintenance.
The major challenges encountered in power plants are capacity degradations of the
boiler, turbine, and generator.
Steaming capacity reduction is typical of an old boiler. Over prolonged operation,

effective heat transfer capacity of the boiler deteriorates due to the following:
1. Scaling of boiler tubes – This is caused by bad chemistry of boiler water; that is
why Sual emphasizes that its process water must be of the purest quality. At any
point during the life cycle of the boiler, if the water quality deteriorates for a long
period, the effects on the boiler tubes are irreversible. To mitigate this, there is an
online water chemistry monitoring device that is read once every 8 hours. It also
notifies the operator of chemical parameters and suggested corrective actions, if
necessary. Also, another method done is to cut a piece of water wall tube and
analyze it for any deposition and microstructures for signs of fatigue, creep, and
wear. If deposition is noticed, then chemical cleaning is done by a third-party
company. Usually, this is done annually.
2. Deterioration of air heaters – Air heaters are subjected to some of the harshest
environments of the plant, with one side having extremely hot flue gas with fly ash,
and the other having cold atmospheric air. Thus, the power plant ensures that the
heaters are analyzed on a regular basis via control system to check for basket
choking and seal leakage.
Meanwhile, capacity degradation of a turbine can be caused by:

1. Bad performance of the condenser – Scaling and corrosion will lead to a bad
condenser performance. To prevent this, the cooling water is ensured to have good
water chemistry. Another mitigation method is reversing the condenser cooling
water flow to remove soft scales. If there is a need to remove permanent scaling,
a chemical cleaning method is done by a third-party company.
The generator’s performance is also affected by:

1. Scaling – Similar to the procedures above, proper monitoring of the water
chemistry and quality is done, and if the scaling is severe, chemical cleaning is
employed.
In addition to these preventative and maintenance measures done by the plant, there
are also two in-house warehouses that store spare parts and equipment, such as pumps.
Energy Requirements
Sual Power Station generates its own electricity. From the voltage of 22-kV produced
by the generator, a step-down transformer reduces the voltage for station use.
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Table 6. Energy Intensity (April 2014 to March 2015)
Material Energy (MWh)

Coal 74593006.99
HFO 109810.26
LFO 5584.90
Gasoline 4023.65
Diesel 16173.98
LPG 800.38
Ethanol (blended with gasoline) 310.15
Coco Methyl Ester (with diesel) 304.98
Purchased electricity 23787.36
Total Electricity Consumption 74753802.65
Gross Electricity Generation 8124159.00
As of March 2015, the energy intensity ratio of Sual was 9.20. This describes the
energy consumed within the organization in order to produce one megawatt of electricity.
Table 6 shows the breakdown of the energy consumed per source. TeaM Sual has
implemented the TeaM Energy Heat Rate Improvement (HRI) Program initiative to reduce
energy consumption. Better heat rates would mean that the power station is using less coal
to generate the same amount of energy, and this results to lower energy costs and is a good
indication of energy efficiency. This initiative mainly consists of turbine heat rate and boiler
efficiency enhancements.
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Supply Chain
Electricity, as a product, cannot be stored in large quantities. It must be consumed and
produced at roughly the same time, and this requires forecasting demands and reserving
readily available supplies. Because of the nature of the commodity, electricity generated by
the Sual Power Station must go through a series of steps until it can reach its end consumer,
as summarized by Figure 42.
Figure 42. Electricity Distribution Overview

Source: Introduction to the Philippine Power Industry Presentation for First Gen Power Camp by Mr. Carlo Vega,
Assistant Vice President of First Gen Corporation
From the power station, a step-up transformer takes the electricity to 138 kV/230
kV/500 kV transmission lines. From here, it can either go to industrial customers (through
bilateral contracts monitored by the NGCP), or to distribution substations (MERALCO, etc.).
From here, 69 kV/115 kV sub-transmission lines take it to transformer wherein the voltage is
stepped down to 13.8 kV, and lastly, to 220 V for commercial and residential use.
Figure 43. General Supply Chain of Sual Power Station
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1000-MW Energy Conversion Agreement
As mandated by TeaM Sual’s 1000-MW Energy Conversion Agreement (ECA) with
the state-owned National Power Corporation (NPC) and managed by its IPPA, San Miguel
Energy Corp., the plant supplies directly to the Luzon grid.
Excess Capacity
On the other hand, the excess capacity (around 200 MW) is sold by its subsidiary,
TeaM Energy (Philippines) Corporation (TPEC). In the era of Retail Competition and Open
Access (RCOA), not only does the Energy Supply Business (ESB) under TPEC handles the
selling, marketing, and trading of the excess electricity in the wholesale energy spot market
(WESM), it also supplies it to various economic zones, electric cooperatives, and large
industrial users in Luzon connected to the grid. Some contestable customers are Liberty Flour
Mills and Manila Water, Inc.
Wholesale Energy Spot Market

The wholesale energy spot market (WESM) is a venue for trading electricity as a
commodity; it is where generators can sell excess capacities not covered by contracts, and
where customers can buy additional capacities on top of their contracts.
WESM stakeholders determine the hourly total demand. Generators then submit offers
through the Market Management System, then the market operator, the Philippine Electricity
Market Corporation, matches the offers of generators with the demand of customers through
the system. The highest offer becomes the spot price of electricity for that particular hour.
Electricity Pricing
Figure 44. Sample MERALCO Bill

Source: Introduction to the Philippine Power Industry Presentation for First Gen Power Camp by Mr. Carlo Vega,
Assistant Vice President of First Gen Corporation
62
There are three major price breakdowns in the usual electricity bill, namely the
generation charge, the transmission charge, and the distribution charge (Vega, 2017).
The largest component of the electricity bill is the generation charge. It is the rate paid
by the distribution utilities to suppliers, and it includes the capital investment, fuel, hat rate,
and operation and maintenance. This factor is therefore influenced by the economics of the
generation facility.
The transmission charge is the cost paid by consumers to the company that operates
the transmission facilities (the monopoly, NGCP). This payment is supposed to ensure the
efficiency and reliability of the NGCP services.
The bill also includes the distribution charges, which are charged by local distribution
utilities for their distribution supply and metering service. Meanwhile, some other charges are
system losses, subsidies, universal charges, feed-in-tariff, and government taxes.
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PHASE III – Health, Safety, and Environment, and Research

& Development
64
Health, Safety, and Environment
Process Safety
For any industry to be successful, it should not only meet production requirements; it
should also maintain safety standards and regulations to ensure the protection of all
concerned. Coal-fired power plants are susceptible to a plethora of hazards in its various
operational areas, and hazard identification and risk assessment is important to ensure the
health and minimize danger to human life, property, and the environment (Constantin,
National, Stefan, & Independent, 2009).
In the following page, Table 7 summarizes the hazard identification and risk
assessments done per operation in a coal thermal plant, based on a study entitled Hazards
Identification and Risk Assessment in Thermal Power Plant (Shrivastava & Patel, 2014).
Furthermore, the corrective actions meant to be done were compared to the protective
measures of Sual Power Station to see whether or not the plant was compliant with operating
safety standards. The operations included are the main systems used in coal-fired power
plants and are those with available data on hazard and risk assessment.
65
Table 7. Summary of Risks, Hazards, and Standards in Coal-Fired Power Plants
STAGES OF CHEMICAL/ HAZARDS RISKS BASED CONTROLS & SUAL POWER

OPERATIONS SUBSTANCE IDENTIFIED ON IDENTIFIED PROCEDURES TO STATION
HAZARDS REDUCE THE RISKS
COAL • Coal • Spontaneous • Injury or death • Regular inspection, Compliant – water
PREPARATION AND ignition and • Respiratory water spray, isolation sprinklers in coal yard
STORAGE combustion problems from ignition sources
• Coal mishandling • Rail line and • Proper PPE, Compliant –
• Coal dust vehicular including dust masks workers in proper
• Clothing caught accidents PPE, as well as
on conveyer belt • Disease and additional head
• Transportation illnesses masks
vehicles • Proper ventilation, Compliant – open
• Ground water spark-proof electrical air coal yard
contamination equipment Compliant –
• Safety guard on conveyer belts have
moving parts protective parts
Compliant –
• Speed limit on plant
enforces 20 KPH
area
speed limit
Compliant – uses
• Protective liner in
HDPE liner in coal
coal storage area
yard
BOILER • Coal • High pressure and • Explosion, • Continuous Compliant –

temperature injury, and monitoring and operators are
• Improper death maintenance stationed to monitor
combustion the parameters in the
boiler
Compliant - annual
maintenance by third
party companies
• Water and • Exposure to hot • Burns and • Regular inspection Compliant - annual
steam water, steam, and injury and maintenance maintenance by third
surfaces • Water tube party companies
• Boiler water levels bursting
• Fly ash • High temperature • Burn injury • Continuous Compliant –
• Fouling • Reduction of monitoring and operator stationed to
efficiency in maintenance monitor boiler
operations parameters
Compliant - annual
maintenance by third
party companies
GENERATOR AND • Steam • Cooling system • Explosion • Regular inspection Compliant - annual
TURBINE failure and maintenance maintenance by third
party companies
• Spare parts and Compliant – plant
equipment (i.e. has two warehouses
pumps) for additional parts
SWITCHYARD • Transformer • Heat generation • Fire, injury, or • Regular inspection Compliant - annual
and explosion death and maintenance maintenance by third
• Electricity • Electric shock party companies
• Switchyard and electric
maintenance burn • PPE and regular Compliant -
• Injury training workers were
observed to wear
complete PPE, with
safety belts
DEMINERALIZATION • Sulfuric acid • Spillage • Chemical burn • PPE ? - did not enter the
PLANT • Caustic soda • Damage on • Injury demineralization plant
lye storage tank or • Training Compliant –
pipe line training is given to all
• Overflow new employee
67
Compliant - annual
• Regular maintenance maintenance by third
party companies
ENTIRE PROCESS • Equipment • Noise exposure • Hearing loss • Use of earplugs Compliant
• Hypertension • Installation of mufflers Compliant
on air pumps
• Installation of rubber Compliant
screens
• Erection barriers
Compliant
(walls and curtains)
LEGEND ✓ COMPLIANT X NOT COMPLIANT ? INFORMATION NOT PROVIDED
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Waste Management and Pollution Prevention
TeaM Energy understands that the use of fossil fuels, water, and various chemicals in
the Sual Power Station have direct effects on air emissions, water discharge, and waste
generation. Thus, they maintain strict protocols and regulations, and adapt environmentally-
sound technology that is less resource-intensive and less polluting to ensure the overall health
and safety of the workers and the environment.
Potential major impacts associated with coal-fired power plant operations include
resource depletion due to use of coal and seawater, air pollution due to generation of stack
emissions, and water pollution due to discharge of wastewater and thermal discharges.
Table 8 summarizes the kinds of pollution and waste generated by Sual Power Station,
identifies the risks each aspect brings, and the mitigation techniques being employed.
Table 8. Summary of Waste Management and Pollution Prevention Strategies
ASPECT CHEMICAL/ HAZARDS RISKS BASED ON CONTROLS & PROCEDURES TO

SUBSTANCE IDENTIFIED IDENTIFIED REDUCE THE RISKS IN SUAL
HAZARDS POWER STATION
MATERIAL USE • Coal • Use of non- • Resource • Improvements on combustion
• Water renewable energy- depletion efficiency and heat rates through
intensive toxic the Heat Rate Impact (HRI)
materials initiative
WATER USE • Water • Volumes used • Resource • Installation of additional flow

during production depletion integrators to monitor consumption
and/or use and later identify possible reduction
in water use
EMISSIONS • NOx • Toxic and harmful • Respiratory • Improvements on combustion
• SOx emissions problems efficiency and heat rate
• Greenhouse • Biodiversity loss • Less coal is being used and thus,
gases • Air pollution GHG emissions are avoided
• Particulates • Green spaces to promote buffer
zones
• Air monitoring stations around the
plant
EFFLUENTS • Water • Quality of water • Biodiversity loss Engineering controls like waste
used during • Habitat destruction water treatment plant, sewage
production and/or • Water pollution treatment plants, and wetland
use systems
WASTE • Non- • Toxicity • Biodiversity loss • Waste is managed in accordance to

reclaimable • Land pollution RA 9003 (Ecological Solid Waste
toxic materials • Water pollution Management Act) and RA 6969
and (Chemical and Hazardous Waste
compounds Management Act)
• Proper waste segregation
• In-site sanitary landfill
Material Use
Through the Heat Rate Impact (HRI) program, the power plant uses less coal to
produce the same amount of power; thus, relatively decreasing the effects of coal resource
depletion.
Water Use
The Sual Power Station is within the vicinity of Baquioen Bay and Pao bay, while its ash
disposal area is adjacent to Loglog river. Currently, there are no government-determined
biodiversity value for these waters, but the adherence to environmental conservation compels
them to include the monitoring of corals, reef fish, marine plankton, soft bottom benthos,
seagrass and seaweed, as part of their semi-annual 3rd party marine resources monitoring.
Also, the Sual plant does not reuse process water as it uses only a one-through circulating
water system.
Emissions
The combustion of coal generally produces emissions that consist of greenhouse
gases (GHGs), NOx, SOx, and particulates, among others. These emissions may reach the
atmosphere, and as a result, lead to air pollution. The Sual Power Station employs
technologies to reduce pollutants in the emissions and to further mitigate potential damage to
the environment.
Direct sources of GHGs (CO2, CH4, N2O, and HFCs, like R-22 and R-134A) are
monitored by the plant. The plant’s most significant initiative to reduce GHG emissions is
through the Heat Rate Improvement (HRI) program, which involves using significantly less
coal to generate the same amount of energy. In addition, the management issued the cCOP-
019 GHG Inventory Program wherein they established a system to compile GHG emissions
using protocols by the International Panel on Climate Change. With this, TeaM Sual was able
to employ a uniform calculation methodology to accurately measure emission factors.
On the other hand, having low NOx boilers, electrostatic precipitators, dust
suppression systems, fly ash silos, and ash lagoons help mitigate the air emissions from the
operations. To be more specific, the flue gas desulfurizer, the low NOx boilers, and the
electrostatic precipitators reduce the amounts of Sox, NOx, and particulate matter,
respectively, in the plant. Furthermore, the Continuous Emission Monitoring System (CEMS)
installed in the chimney as well monitors the sulfur oxides, nitrogen oxides, and opacity in the
flue gas.
The plant also has stack emission tests for heavy metals, electrostatic precipitator
efficiency tests, Relative Accuracy Test Audits (RATA), air monitoring station systems, and
semi-annual ambient air and noise monitoring to ensure that the plant complies with the
standards of DENR.
To prevent biodiversity loss, pockets of green spaces within the Sual Power Station
have been made (serves as a buffer zone) to allow various species of endangered migratory
birds to thrive rather than perish due to possible harmful effects of the plant emissions.
Effluents
The generated wastewater from the plant processes are pumped into the waste water
treatment plant to prior to discharge.
Table 9. Wastewater Discharges
Type of Discharge Treatment Method Discharge

Destination
Effluent from chemical Sedimentation basin 1 and Pao Bay
treatment wastewater treatment plant
Storm drains collecting pond Sedimentation basin 2 Baquioen Bay
Treated effluent from main Sewage treatment plant lagoon and Baquioen Bay
plant biological treatment
Discharge from sanitary Wetland Baquioen Bay
landfill
Cooling water discharge N/A Pao Bay
Reverse osmosis brine N/A Pao Bay
reject discharge
Water quality parameters are also monitored on a monthly basis to ensure that the
discharges are always within prescribed limits. Also, as there are potential impacts on
biodiversity, including the displacement of thermally sensitive aquatic species, the plant’s
cooling water discharge canal effectively dissipates heat to ensure compliance with the DENR
maximum allowable temperature change of 3°C. The plant also has a monitoring system to
detect any abnormality to marine life as an effect of thermal discharge.
Wastes
Plant waste mitigation measures for hazardous wastes include composting for grease
trap wastes, established hazardous waste storage areas, off-site treatment through DENR-
accredited hazardous waste transporters, and management facilities.
Furthermore, mitigation measures for slid wastes include the implementation of a

comprehensive ecological waste management program with the following parts: segregation
at source, off-site recycling, and the establishment and maintenance of a sanitary landfill.
Incidents
Last October 27, 2014, 12.96 m3 of HFO leaked from the supply line during the start-
up of one of the units. While the operation was land-based, the oil traced back to the cooling
water outfall within the plant premises. Although it was concluded that no significant damage
was done to the immediate marine ecosystem (through water quality testing by the DENR),
the power plant had employed additional safeguards to prevent similar occurrences in the
future. Relief valves were tested, pipe thicknesses were inspected, and carbon steel pipes
were upgraded to stronger stainless-steel pipes.
Another incident was a jelly fish impingement on the intake screens in 1999. Since
then, three layers of nets have been placed in the intake area to prevent this from happening
again.
Occupational Safety
In Sual Power Station, mechanisms have been set in place as part of their operations
to provide venues where discourse on the subject of safety is constantly held. The nature of
the business demands that operating procedures adhere to strict safety regulations, and so,
to ensure the safety of the staff, sessions and seminars are provided to equip each employee
with the knowledge and training necessary to fulfill safety guidelines and regulations.
72
Figure 45. Training Session in Sual Power Staton
Source: TeaM Energy Sustainability Report 2015
Use of PPE
Workers in the Sual Power Station must wear personal protective equipment as a
safety measure to prevent injury. The minimum requirement is eye protection, safety helmets,
safety footwear, protective clothing, hearing protection (earplugs), hand protection, and in
certain areas, respiratory protection, like dust masks (CS Energy, n.d.).
Furthermore, for personnel working in the sun for periods longer than 20 minutes are
recommended to apply sunscreen on unprotected areas of the skin. Also, it is discouraged for
workers to have facial hair as this may prevent an adequate seal between the wearer’s face
and the respiratory protection worn.
In addition, all visitors are required to wear long pants, sleeved-shirts, and closed
shoes. If the visitors were allowed to step outside and into the operating areas (unlike the
regular visitors confined to a bus going around the compound), they are to wear high visibility
protective clothing, safety glasses, and orange hard hats.
During the visit, it was observed that all employees seen were adhering to the PPE
guidelines set in the power plant.
Ergonomics
Since the plant is fully automated, only certain aspects of ergonomics can be
discussed. The ergonomic model of Agnihotri was employed. According to the study, the
applicable productivity improvements for thermal power plants using an ergonomic point of
view are categorized as noise, temperature, lighting, and working postures (Agnihotri,
Dandotiya, & Agrawal, 2013).
Noise
One of the most common occupational health concerns, noise can cause annoyance,
stress, and interference with speech communication. To prevent the negative effects of noise
exposure, noise levels should be reduced to acceptable levels. As previously mentioned, the
power plant has physical mufflers, and workers also use earplugs when dealing with noisy
equipment.
Temperature
The recommended and optimum temperature of an indoor office/control room is a
temperature of 24.5°C, with an acceptable range of 23-26°C.
73
On the other hand, for working outdoors, there is no set maximum temperature limit in
regulations. It generally depends on the level of physical labor and the allocation of work in a
work/rest cycle. For heavy work, as in, processes in a coal yard, the recommended
temperature ranges from 27-31.5°C. In case of discomfort, some precautionary measures
taken include wearing light clothing underneath PPE, taking frequent rest breaks, and drinking
a lot of fluids.
Lighting
Lighting is important in an office because proper lighting makes all work tasks easier.
Appropriate lighting, without glare or shadows, can reduce eye fatigue and headaches, and it
can even prevent workplace accidents and injuries. In the administrative building, it is
recommended to use fluorescent lightbulbs, while inside the processing areas, high pressure
sodium lightbulbs or metal halide lightbulbs are good candidates.
Working Posture
Injuries from sitting for too long are serious occupational health and safety issues. It
can affect blood circulation, reduce body movement, cause fatigue, and steady compression
in spinal discs. The elements affecting the comfort and the posture of a seated employee are
influenced by the nature of tasks, the work station, and the chair.
In one’s workstation, it is important that it I designed to reduce strain on the neck. One
way to do so is to ensure that the visuals (computer screens, control room screens, etc.) are
at eye-level of the operator.
It is also important to select a chair that is fully adjustable that can accommodate the
maximum range of people. Its seat height and tilt should be easily adjusted, and its back rest
should also be firm.
Ventilation
Most of the employees of the power plant are situated in the administrative building or
in the control rooms, since almost everything is automated by their process controls, the
Distributed Control Systems (DCS). The only exception are the operations done in the coal
yard. Ventilation is not a problem for the workers there, as it is completely open air. For added
safety from the coal dust, the workers are in PPE and dust masks to prevent respiratory
problems.
Medical Examinations
The Sual Power Station compound is equipped with a round-the-clock medical clinic,
as well as a fire station to ensure the safety of the workers. No information was gathered on
the frequency of the medical examinations. But according to the TeaM Energy Sustainability
Report of 2015 (TeaM Energy, 2015), the injury rate of the Sual Power Station employees is
0.25, which accounts for just 1 medical attention case. Meanwhile, for the contracted
employees, the injury rate is 0.80, which includes 3 medical attention cases and 5 first aid
cases. There have been no reported instances of high risk diseases that are connected to
their occupation in the power plant.
Certifications and Awards

As a testament to the power station’s performance in the aspects of health, safety, and
the environment, the Sual Power Station has received the Quality Management Certification
(ISO 9001: 2015 Certification), which means that the systems are in place for the operations
of the plant. Also, as the power plant manages risks that arise from natural calamities and
disasters, they also pursued a Business Continuity Program to align with ISO/IEC 22301:201
Standard. Furthermore, it is also ISO 14001-certified, with the Environmental Management
74
System (EMS), and Occupation Health and Safety Assessment Systems (OHSAS) 18001-
certified.
Figure 46. Certifications of Sual Power Station
Other accomplishments and recognitions of the power plant are the following:
• Champion, 9th Gawad Kalusugan and Kaligtasan Award, Department of Labor
and Employment (2012)
• Official Seal of Approval, Department of Environment and Natural Resources
(2012)
• Master Award for Zero Basura, Philippine Business for Social Progress (2013)
• Scroll of Honor Award, Philippine National Red Cross (2013)
• Likas Yaman Award of Excellence, Department of Energy and Natural Resources
(2013)
• Award of Excellence for Perfect Safety Record, Safety Organization of the
Philippines (2013)
• Award of Distinction, Safety Organization of the Philippines (2014)
75
Research and Development
Research and development are of utmost importance within the energy sector,
especially when it comes to managing some of the major global challenges we are facing,
such as greenhouse gas emissions and climate change, coupled with the expected rise of
energy requirements. New problems lead to new approaches, new discoveries, and new
opportunities for improvement.
Until an alternative viable source of energy emerges that will be able to supply base
load capacity, coal will continue to be the main fuel source. And in the Philippine context, more
and more coal-fired thermal power plants will sprout up until 2040, as they account for nearly
80% of the capacity of upcoming projects. It is therefore significant to have technology to at
least mitigate environmental impact, to meet regulatory standards, and to provide enough
electricity to the nation.
For Sual, the plant is focusing more on mitigating environmental impact. They report
that their awareness and concern for climate change “compels them to continue to improve
their unit heat rate, maintain excellent environmental performance, and conduct feasibility
studies on renewable energy projects.” They also have reforestation and forest protection
programs to improve the carbon sink capacity in Pangasinan. But for the future coal-based
power plants, it is imperative that certain process development strategies be adapted to make
operations more efficient and environmentally-friendly from the beginning.
Process Development
According to Vattenfall, reducing CO2 emissions, in both the short and long term, is
the most important challenge for research and development work on coal-sourced energy. In
the short term, co-firing with biomass at existing power plants can be explored, but for the
longer term, the goal is to use technologies to improve efficiency, to reduce carbon emissions,
and to separate and store CO2 before it even reaches the atmosphere (Vattenfall AB, n.d.).
Co-Firing
Co-firing with biomass presents great potential in reducing the use of coal for electricity
production. Basically, coal is blended with biomass in the combustion process. Using co-firing,
a power plant that is, for example, 96 MW, can reduce its CO2 emissions its emissions by 435
kilotons. However, current coal-fired power plants are not fully able to shift to co-firing from
pure coal burning without requiring extensive modifications and reconstructions. Furthermore,
once biomass is added into the mix, there is a risk of reduced maximum capacity, increase
corrosion, and problems with the quality of ash products.
Clean Coal Technology

The World Coal Association is pushing for the use of clean coal technology in the
Philippines, and is promoting high efficiency, low emission (HELE) coal technology. HELE
technology improves the efficiency of coal-fired power plants with the following developments:
supercritical and ultra-supercritical technology, integrated gasification combined cycle, and
fluidized bed combustion. These systems are already being used in countries like Japan,
where nearly 50% of its coal-fired power plants use ultra-supercritical units.
In the Philippines, there will soon be the first supercritical coal-fired power plant
(Meralco PowerGen Corp) with 2x600 megawatt capacity. However, its power supply
agreements (PSAs) are still pending for approval by the Energy Regulatory Commission
(ERC).
76
Figure 47. Subcritical Unit (Drum-type Boiler)
Figure 48. Supercritical and Ultra-Supercritical Unit (Once Through-type Boiler)
The general difference between the supercritical units versus the subcritical units (what
is being used in Sual Power Station, and in all other power stations in the Philippines), is that
there is no two-phase state that occurs in the furnace, and a drum is not required. Supercritical
plants provide significant efficiency improvements over subcritical units, achieving efficiencies
of 38% higher heating value (HHV). Ultra-supercritical plants generate efficiencies of up to
42%. This is compared to the subcritical units in pulverized coal plants, with an efficiency of
33% HHV.
To enable the construction of these units, the development of metal alloys that retain
their strength at very high temperatures, and resist corrosion, creep, and other mechanisms
is important. It should also be cost-effective, which is probably why it has taken so long for the
Philippines to finally have plans to construct one.
Meanwhile, integrated gasification combined cycle (IGCC) plants use a gasifier to

convert coal to syngas, which drives a combined cycle turbine. IGCC systems are among the
cleanest and most efficient of the emerging clean coal technologies.
A fluidized bed combustion (FBC) plant, which can burn most combustible material,
including coal, biomass, and general waste, improves the environmental impact of coal-based
electricity by reducing SOx and NOx emissions by 90%. In FBC plants, sand or some inert
material is fluidized by an air stream and is raised to the ignition temperature by an external
heating source. When the required temperature is reached, coal is fed vigorously to the
bubbling bed, where it becomes thoroughly mixed with the sand. As combustion begins,
volatile material is given off and usually burns in the freeboard above the bed.
77
Carbon Dioxide Capture and Storage
While coal power plants are still going to be used until the foreseeable future, the
Department of Science and Technology is already investigating the possibility for carbon
dioxide sequestration in the Philippines. The concept of carbon dioxide capture and storage
(CCS) refers to a technology that attempts to prevent the release of large quantities of CO2
into the atmosphere from fossil fuel used in power generation. CCS involves the capture,
transport, and pumping of carbon dioxide into underground geological formations to store the
gas away from the atmosphere. It is also a low-cost mitigation technology for greenhouse
gases.
There are three primary approaches to carbon dioxide capture being investigated:
post-combustion capture (PCC), pre-combustion capture, and oxy-combustion capture. The
most applicable ones in the Philippine setting are PCC technologies and oxy-combustion
technologies (Maxson & Phillips, 2011).
Post-combustion Capture
PCC technologies are used to absorb CO2 from flue gas at atmospheric conditions.
Here, a chemical solvent selectively absorbs CO2. The CO2-saturated solvent passes through
a regenerating column (or a stripper), where it is heated to release nearly pure CO2 stream
that is then returned to the absorber.
Oxy-combustion Capture
Oxy-combustion separates oxygen from air and combines it with recycled flue gas, so
that combustion occurs in the presence of oxygen and CO2, producing a flue gas that is rich
in CO2. This allows for CO2 to be more easily purified and compressed prior to transport and
storage.
Shifting to Renewable Energy

Ultimately, the goal is to be able to shift the dependence of the Philippines from non-
renewable sources, such as coal, oil, and gas, to renewable energy. Thus, research in
resources that can contribute to the national government’s vision to ensure sustainable,
secure, sufficient, accessible, and affordable energy is significant.
A study, spearheaded by the Department of Energy and the United States Agency for
International Development, is entitled Greening the Grid. It was published in 2018 and it aimed
to the Philippine power sector in evaluating the impacts and opportunities associated with
achieving high levels of variable RE penetration. It highlights the use of solar and wind energy.
One finding in the study is that RE targets are achievable in the power system as
planned but achieving them will likely involve changes as to how the power system is operated,
especially in the operation of conventional thermal generators. In the future scenarios (2030
and 2040), RE has the capacity to displace coal and natural gas, leading to a 18%-40%
reduction in thermal fuel consumption, and a 19%-41% reduction in GHG emissions.
Achieving high levels of solar and wind integration will also require coordinated planning of
generation and transmission development, beyond those already planned. Thus, additional
strategic investments are needed to help enable the integration of solar and wind resources
(United States Agency for International Development & Department of Energy, 2018).
Meanwhile, while total revamping of the power sector is unrealistic, small steps to
achieving utilization of REs is important. The Institute of Energy Economics and Financial
Analysis and the Institute for Climate and Sustainable Cities reports that the Philippines can
save up to 1.91 million USD (10 billion PHP) a year if it replaces non-renewable sourced power
generators in off-grid areas with renewables. With solar-powered electricity costs falling by
99% since 1976, and 90% since 2009, and even the cost of wind-power generation declining
78
by 50% since 2009, the usage of renewable energy makes sense in small islands that are
unable to be connected to the grids.
In addition, the Institute of Energy Economics and Financial Analysis also reports that
the new coal tax (TRAIN), which increased the tax by 400%, can drive investment for cheaper
renewable energy in the Philippines.
Also, with the Renewable Energy Law, the feed-in-tariff (FIT) scheme, which sets a
fixed price for electricity sourced from renewable energy for 12 years, can encourage
investments in renewable infrastructure.
The Department of Energy has also laid out a Renewable Energy Roadmap leading to
2040, as shown in Table 10. By 2040, it is aimed to increase the installed capacity of
renewable energy generators to at least 20,000 MW, which will be around 40% of the projected
demand of 49287 MW in that year.
79
Table 10. DOE Renewable Energy Roadmap (2017-2040)
SHORT-TERM MEDIUM-TERM LONG-TERM

(2017-2018) (2019-2022) (2023-2040)
ACCELERATION OF • Finalize rules and implement Green • Intensify development in off- • Continue and accelerate
REPOSITIONING Energy Option grid areas implementation of RE
• Conduct detailed RE technology and • Determine realistic RE projects
resource assessment potential • Conduct regular updating of
• Review other RE policy mechanisms RE resource database
• Monitor and assess RESCs awarded
CREATION OF A • Streamline administrative processes of RESC applications
CONDUCIVE • Work on DOE energy projects to be declared as projects of national significance
BUSINESS • Provide technical assistance to lower investment costs
ENVIRONMENT • Promote and incentivize local technology producers
• Explore and initiate on the harmonization of LGUs and national government related programs and policy
RELIABLE AND • Strengthen the resiliency of RE systems and facilities
EFFICIENT • Harmonize transmission development plan with RE targets
INFRASTRUCTURE • Develop geographical installation targets
• Enhance local technical capabilities
• Conduct R&D on the efficiency of RE technologies of the Smart Grid System
PROMOTE AND • Continue to conduct RE technology research and development studies
ENHANCE R&D • Identify viability of new technologies
AGENDA • Construct ocean pilot/demo energy projects
• Implement, monitor, and evaluate pilot/demo projects for RE technologies
OTHER ACTIVITIES • Identify parameters to determine the viable ocean energy tariff rate
• Continue technical capacity building on RE
• Conduct research and promote low enthalpy geothermal areas for power generation and direct use/non-
power application for development
• Harmonize the DOE related programs with agro-forestry policies for an integrated use of biomass
Conclusion
Coal is one of the most important fuel sources for electricity generation, especially in
the Philippines, because it is the most reliable source most suited in meeting the growing
energy needs cost-efficiently. The power plant analyzed makes use of a pulverized coal boiler
to generate steam that moves turbines. This produces mechanical energy and is then
converted to electrical energy by means of a generator. This electricity is then thrown into a
grid by transformers, and this electricity is transmitted through transmission lines, and
distributed to various sectors and consumers.
Following the predicted trends as shown in Phase I, coal will prevail as the economical
electricity source of choice up to the near future despite environmental qualms while the
renewable energy sector is still currently being developed in the country. It is predicted also
that oil’s share in electricity generation will remain low, with a bulk of that portion coming from
production supplied by “auto-producers” – generators whose primary activity is not public
electricity supply. In addition to the predicted trends, the Philippines is actually looking at a
future with electricity that is coal-driven, as there are 23 new coal-fired power plants lined up
for commercial operation within the next five years, and another 10423 MW-capacity worth of
coal projects in 2025 through private and foreign investments.
Of course, with the growing concerns about the environment and climate change that
have triggered public clamor for clean and sustainable energy, it is important to take the
necessary steps in ensuring that the (over)dependence on coal curtails, especially since it’s a
finite resource. For the mean time, however, given the current politics and policies, lack of
developed technology, and capital costs, it is not likely that renewable energy will completely
replace coal as a fuel source in the near future; that is totally unrealistic and practically
impossible.
Power generators that use renewables should be invested in, especially in off-grid
areas. Furthermore, while research and development are still being done on renewable
energy, as well as creating mechanisms for it to supply enough electricity to meet the
nationwide demand, mitigating environmental impact while adapting technology to improve
power plant efficiency are the most important steps to take.
Glossary
BBD Broyer-Boulet-Direct Firing
BMCR boiler maximum continuous rating
BMI Business Mirror
BMT billion metric ton
BOT build-operate-transfer
CCS carbon dioxide capture and storage
CEMS Continuous Monitoring and Maintenance Systems
DCS distributed control system
DENR Department of Environment and Natural Resources
DOE Department of Energy
DU distribution utility
EC electric cooperative
ECA Energy Conversion Agreement
EMS Environmental Management System
EPIRA Electric Power Industry Reform Act
ERC Energy Regulatory Commission
ESB Energy Supply Business
FBC fluidized bed combustion
FGD flue gas desulfurizer
FIT Feed-in-Tariff
GHG greenhouse gases
HELE high efficiency, low emission
HFO heavy fuel oil
HHV high heating value
HRI heat rate impact
HVDC high voltage direct current
IGCC integrated gasification combined cycle
IPP independent power producer
IPPA Independent power producer administrator
ISO International Organization for Standardization
kg kilogram
kV kilovolt
LDO light diesel oil
LFO light fuel oil
MERALCO Manila Electric Company
82
MJ mega joules
MMT million metric ton
MW megawatt
MW megawatt
MWh megawatt-hours
N/A not applicable
NGCP National Grid Corporation of the Philippines
NPC National Power Corporation
OHSAS Occupational Health and Safety Assessment Systems
OPEC Organization of the Petroleum Exporting Countries
PC pulverized coal
PCC post-combustion capture
PDU private distribution utilities
ppb parts per billion
PPE personal protective equipment
PSALM Power Sector Assets and Liabilities Management Corporation
RA Republic Act
RATA Relative Accuracy Test Audits
RE renewable energy
RO reverse osmosis
SMEC San Miguel Energy Corporation
SMPC Semirara Mining and Power Corporation
TPEC TeaM Energy Philippines Corporation

TRAIN Tax Reformation for Acceleration and Inclusion
TRANSCO National Transmission Corporation
TWh trillion watt-hours

WESM wholesale energy spot market
83
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85
Appendix A
1. Plant Visit Photos
86
87
Appendix B
Note: The following data tables were obtained from the 2016 Power Statistics file available on
the DOE website. This appendix covers the summary of the power sector of the Philippines.
1. Power Consumption by Sector in GWh
2012 2013 2014 2015 2016

Residential 19695 20614 20969 22747 25631
Commercial 17777 18304 18761 20085 21770
Industrial 20071 20677 21429 22514 24117
Others 1668 1971 2186 2462 2634
Electricity 59211 61566 63345 67808 74153
Sales
Utilities 5351 5959 6461 7124 8357
Power 8360 7741 7455 7481 8288
Losses
TOTAL 72922 75266 77261 82413 90798
2. Power Generation by Grid in GWh
2012 2013 2014 2015 2016

Luzon 52312 54820 56766 60113 66498
Visayas 11483 11100 11014 12170 12955
Mindanao 9127 9347 9481 10130 11345
TOTAL 72922 75266 77261 82413 90798
3. Power Generation by Source in GWh
2012 2013 2014 2015 2016

Coal 28265 32081 33054 36686 43303
Oil-based 4254 4491 5708 5886 5661
Combined 227 247 515 276 694
Cycle
Diesel 3332 3805 4730 5531 4722
Gas Turbine 0 0 0 0 0
Oil Thermal 695 438 463 80 245

Natural Gas 19642 18791 18690 18878 19854
Renewable 20762 19903 19810 20963 21979
Energy
Geothermal 10250 9605 10308 11044 11070
Hydro 10252 10019 9137 8665 8111
Biomass 183 212 196 367 726
Solar 1 1 17 139 1097
Wind 75 66 152 748 975
TOTAL 72922 75266 77261 82413 90798
88
4. Dependable Generating Capacity in MW
2012 2013 2014 2015 2016

Coal 5206 5206 5378 5613 6979
Oil-based 2561 2848 2705 2734 2821
Natural Gas 2760 2760 2760 2759 3291
Renewable 4539 4559 4789 5325 6005
Energy
Geothermal 1462 1482 1607 1601 1689
Hydro 2983 2983 2982 3073 3181
Biomass, 94 94 201 651 1135
Solar, Wind
TOTAL 15066 15371 15633 16432 19097
5. System Peak Demand per Grid in MW
2012 2013 2014 2015 2016

Luzon 7178 8305 8717 8928 9726
Visayas 1481 1572 1636 1768 1893
Mindanao 1346 1428 1469 1517 1653
TOTAL 10005 11305 11822 12213 13272
89
Appendix C
the DOE website. This encompasses the Gross Power generation by Plant Type in MWh, as
well as the capacity mix in MW.
1. Luzon
2012 2013 2014 2015 2016

Coal 21877501 25755945 27346492 29679511 33143458
Oil-based 1800321 1600626 2342360 1844787 2561831
Combined 227354 247159 514980 275892 693685
Cycle
Diesel 1099123 1183466 520521 1483116 1622749
Gas Turbine 0 0 0 10290 499
Oil Thermal 473844 170001 306859 75489 244898

Natural Gas 19641527 18783471 18685808 18877915 19853783
Renewable 8993077 8679476 8391821 9710650 10938477
Energy
Geothermal 3588417 3398601 3817330 4096454 4226913
Hydro 5292482 5155521 4357160 4768825 5011100
Biomass 36839 59699 652789 187188 438807
Solar 66427 494946
Wind 75339 65655 152052 591756 766711
TOTAL 52312426 54819517 56766481 60112863 66497549
2. Visayas
2012 2013 2014 2015 2016

Coal 4701053 4689683 4449483 4968437 5270242
Oil-based 734172 796470 765893 672207 637405
Diesel 514274 528780 614558 672207 637405
Gas Turbine 0 0 0 0 0
Oil Thermal 219899 267689 151355 0 0
Natural Gas 7815 4269 0 0

Renewable 6047489 5605626 5794279 6529839 7047239
Energy
Geothermal 5930484 5463017 5627241 6105383 5974487
Hydro 46161 36936 35475 38375 63532
Biomass 70844 105673 116523 158864 276053
Solar 15040 70559 524658
Wind 156658 208509
TOTAL 11482714 11099593 11013924 12170484 12954886
90
3. Mindanao
2012 2013 2014 2015 2016

Coal 1686314 1635380 1257542 2037738 4889542
Oil-based 1719521 2093504 2599495 3369442 2462172
Diesel 1718684 2093831 2595139 3365393 2462172
Oil Thermal 837 673 4356 4050 0
Natural Gas 0
Renewable 5721036 5617847 5623555 4722686 3993743
Energy
Geothermal 731089 742980 863542 841857 869002
Hydro 4913491 4826851 4744638 3857878 3036282
Biomass 75136 46602 13897 21403 11046
Solar 1320 1414 1477 1548 77412
Wind 0
TOTAL 9126871 9346731 9480592 10129866 11345457
4. Capacity Mix of the Philippines
Luzon Visayas Mindanao Philippines

Coal 5404 1050 1220 7674
Oil-based 1715 473 752 2939
Diesel 645 473 752 -
Oil Thermal 530 0 0 -
Gas Turbine 540 0 0 -
Natural 3291 0 0 3291
Gas
Renewable 3747 1454 1051 6252
Energy
Geothermal 782 870 100 1752
Hydro 2340 18 899 3257
Biomass 66 84 1 160
Solar 265 392 43 700
Wind 293 90 0 383
TOTAL 15392 2976 3023 20156
91
Appendix D
the DOE website. This encompasses the Electricity Consumption per in MWh.
1. Luzon
2012 2013 2014 2015 2016

Residential 14262257 15055561 15304067 16527747 18650032
Commercial 14905458 15509869 16102599 17272475 18726890
Industrial 14085532 14378824 14939121 15875875 17094048
Others 810429 858922 894719 913226 942178
Total Sales 44063677 45803175 47240505 50589323 55413149
Utilities 3952498 4549543 5040459 5598130 6517613

System 5706961 5383067 5207774 4911892 5289833
Loss
TOTAL 53723136 55735785 57488739 61099345 67220596
2. Visayas
2012 2013 2014 2015 2016

Residential 2680862 2735203 2770126 3068120 3508238
Commercial 1425684 1446028 1301551 1419321 1554845
Industrial 3031684 3136622 3214079 3268068 3470390
Others 521270 549765 753265 1010738 1065378
Total Sales 7646701 7867617 8039020 8765247 9598851
Utilities 1092227 1055265 1049087 1130876 1188570

System 1333075 1260444 1203559 1287879 1444418
Loss
TOTAL 100720031 10183326 10291667 11184002 12231839
3. Mindanao
2012 2013 2014 2015 2016

Residential 2764576 2822954 2894679 3151182 3472984
Commercial 1446080 1347851 1356637 1393988 1488432
Industrial 2953756 3161354 3275468 3369939 3554098
Others 335829 562662 538476 538067 626710
Total Sales 7500241 7894820 8065259 8453177 9142225
Utilities 306426 354587 371725 395368 651156
System 1320204 1097314 1043608 1281422 1552077
Loss
TOTAL 9126871 9346731 9480592 10129866 11345457
92
Appendix E
Note: The following data tables were obtained from the List of Existing Power Plants file
available on the DOE website. This encompasses the Capacities of Grid-Connected Power
Plants per grid in MW.
1. Luzon Grid
Facility Name Dependable Location Operator IPPA

Capacity
Anda 72 Mabalacat, Anda Power Anda Power
Pampanga Corporation Corporation
APEC 42 Mabalacat, Asia Pacific Asia Pacific
Pampanga Energy Corp. Energy Corp.
Calaca U1 270 Calaca, SEM Calaca SEM Calaca
Calaca U2 300 Batangas Power Corp. Power Corp.
Mariveles U1 302 Mariveles, GN Power GN Power
Mariveles U2 302 Bataan Mariveles CoalMariveles Coal
Plant Ltd. Co.Plant Ltd. Co.
Masinloc U1 315 Masinloc, Masinloc- Masinloc-
Masinloc U2 315 Zambales Power Power
Partners Ltd. Partners Ltd.
Pagbilao U1 382 Pagbilao, TeaM Thermal
Pagbilao U2 382 Quezon Pagbilao Corp.Luzon Inc.
(TLI)
Quezon Power 460 Mauban, Quezon Power Quezon Power
Quezon Phils. Ltd. Phils. Ltd.
(QPPL) (QPPL)
SCPC U1 150 Limay, Bataan SMC SMC
SCPC U2 150 Consolidated Consolidated
Power Power
Corporation Corporation
SLPGC U1 150 Calaca, Southwest Southwest
Batangas Luzon Power Luzon Power
Generation Generation
SLTEC Puting 150 Calaca, South Luzon South Luzon
Bato U1 Batangas Thermal Thermal
SLTEC Puting 122 Energy Energy
Bato U2 Corporation Corporation
Sual U1 647 Sual, TeaM Sual San Miguel
Sual U2 647 Pangasinan Corporation Energy Corp.
(SMEC)
UPPC 24 Calumpit, United Pulp & United Pulp &
Bulacan Paper Co., Paper Co.,
Inc. Inc.
93
2. Visayas Grid

Capacity
CEDC Coal 82 Toledo City, GBPC - Cebu GBPC - Cebu
U1 Cebu
CEDC Coal 82
U2
CEDC Coal 82
U3
KepCo Coal 103 Naga, Cebu KepCo-Salcon KepCo-Salcon
U1
KepCo Coal 103
U2
PEDC Coal 83.7 Iloilo City, GBPC - Panay GBPC - Panay
U1 Iloilo
PEDC Coal 83.7
U2
PEDC Coal 150
U3
PCPC 150 Concepcion, Palm Palm
Iloilo Concepcion Concepcion
Power Power
(PCPC) (PCPC)
3. Mindanao Grid

Capacity
FDC Misamis 120 Villanueva, FDC Utilities, FDC Utilities,
U1 Misamis Inc. Inc.
FDC Misamis 120 Oriental
U2
FDC Misamis 120
U3
Mindanao 105 Villanueva, STEAG State PSALM
Coal U1 Misamis Power Inc. Corporation
Mindanao 105 Oriental
Coal U2
SMC Malita 135 Malita, Davao San Miguel San Miguel
U1 Occidental Consolidated Consolidated
Power Power
Therma South 130 Davao City, Therma South Therma South
U1 Davao Del Sur Inc. (TSI) Inc. (TSI)
Therma South 130
U2
94
Appendix F
1. Philippine Grid Peak Demand Forecast, 2018-2022 in MW
Year Luzon Visayas Mindanao Philippines

2018 10368 1997 1911 13778
2019 10895 2298 2229 15422
2020 11451 2465 2407 16323
2021 12000 2633 2588 17221
2022 12579 2812 2782 18173
2. Country Ranking in Coal-Sourced Power Generation
3. Electricity Supplies Reflect Diverse Sources
95
Appendix G
NOTE: The following screenshots are obtained from a Philippine Statistics Authority file, the
data of which is sourced from the Department of Energy.
1. Coal Production in the Philippines
2. Coal Consumption in the Philippines
96
3. Coal Imports in the Philippines
97
Appendix H
All the following tables were lifted from the TeaM Energy Sustainability Report of 2015 (TeaM
Energy, 2015).
1. Energy Intensity
2. Energy Consumption within the Organization
98
3. Water Withdrawal Volume
4. NOx, Sox, and Significant Air Emissions
99
LIMITATIONS OF THE STUDY
oData is obtained from
A REVIEW ON THE COAL- AND FUEL Department of Energy,
Philippine Statistics Authority,
OIL-FIRED POWER PLANT INDUSTRY and the World Bank
†
IN THE PHILIPPINES (APRIL 2018) oYears 2012 - 2016
Maria Crispina B. Buensuceso | ChE 140 o Dependable capacity for
power demand analysis
oProtocols and processes of
Sual Power Station in Sual,
Pangasinan
ELECTRICITY GENERATION ELECTRICITY GENERATION

HISTORY INDUSTRY OVERVIEW
600 B.C. Thales of Miletus discovers static electricity
1822 Fundamental principle of electricity by Michael Faraday
1870 Development of dynamo that produced a steady DC current

1882 Thomas Edison’s central generating station in NYC
1884 First steam turbine generator
1888 AC current invented by Nikola Tesla
20th
Century Improvement in equipment efficiency
1970s Oil prices shoot up

1990s Philippine Power Crisis
2001 Energy Power Industry Reform Act (EPIRA)
ELECTRICITY GENERATION ELECTRICITY GENERATION

INDUSTRY OVERVIEW INDUSTRY OVERVIEW
FUEL OIL FOR
SUAL POWER STATION
ELECTRICITY GENERATION Sual, Pangasinan, Philippines
oDependence on fuel oil has
increasingly decreased over the
past decades
oWorld share: 4.069%
oPhilippine share (on-grid): Station Capacity: 1218 MW (2x609 MW)
6.847%
Operating Mode: Base load (24 hours, 7 days a week)
oStill has significant functions:
Plant Complex Area: 142 hectares
o For areas that lack access to
grid/tough terrain Ash Disposal Area: 140 hectares
o Visayas has the most fuel oil-fired Main Fuel: Bituminous Coal
generators
o For meeting peak load demand IPPA: San Miguel Energy Corporation (SMEC)
o Embedded systems
MARKET DATA MARKET DATA

SUPPLY DATA MARKET DYNAMICS
MARKET DATA MARKET DATA

MARKET DYNAMICS REGIONAL AND GLOBAL
RAW MATERIALS & SOURCING MANUFACTURING PROCESSS
o Bituminous Coal
o Imported coal (from Indonesia) delivered to jetty port
2-3 times a month through SMEC
o 60.12 USD per MT
o 2,878,136 MT from fiscal year 2014-2015
MAJOR PROCESS CONTROLS

EQUIPMENT
o Coal Mill o Logic control, analog
o Four horizontal ball and tube mills control, and data
o Boiler acquisition: advanced
o Operating Pressure: 180 bar Distributed Control
o Operating Temperature: 538°C
System
o Condenser
o Shell & tube Hex o Decentralized
o Operating Pressure: 83 bar operations are
o Cooling Water Temp.: 30°C
o Turbine
controlled via local
o Operating Pressure: 175 bar panels
o Operating Temperature: 540°C
o Generator
o Rated Output: 647 MW
o Rated Voltage: 22 kV
o Chimney
o Height: 226 m
PROCESS SAFETY &

DISTRIBUTION & LOGICSTICS
OCCUPATIONAL HEALTH
o Generation
Charge
o Influenced by
power plant
economics
o Transmission
Charge
o Distribution QUALITY ENVIRONMENT
Charge
o Others
o System losses
o Subsidies Ⅹ Fire and explosions
o Universal Ⅹ Burns and injuries
charges Ⅹ Electrocution
o Government OCCUPATIONAL Ⅹ Inhalation of dust
taxes HEALTH & SAFETY
Ⅹ Noise
WASTE MANAGEMENT &
RESEARCH & DEVELOPMENT
POLLUTION CONTROL
Water oCo-firing
o Waste Water Treatment Plant o Coal is blended with
o Temperature Monitoring biomass
o Liner System Technology oClean Coal Technology
o High efficiency, low
emission (HELE)
Air technology
o Electrostatic Precipitator o Supercritical and ultra-
o Flue Gas Desulfurizer (FGD) supercritical boiler units
o Continuous Emissions Monitoring System (CEMS) oCarbon Dioxide Capture
o Water Sprinkler System and Storage
o Buffer Zone Tree Planting oShifting to Renewable
o Air Monitoring Stations Energy
o 226-m High Chimney
CONCLUSION
PROJECTED ELECTRICITY
DEMAND PER SOURCE oFuel oil is not likely to
Source: ExxonMobil
be used in the future
o23 new coal power
plants to operate
within the next 5
years
Power in TWh
o10423MW capacity
worth of coal projects
up to 2025
oMitigate
environmental impact
oImprove efficiency

Review of The Oil and Coal Power Plant I

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Review of The Oil and Coal Power Plant I

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By Maria Crispina B.

An Undergraduate Research Paper

Submitted in Partial Fulfillment

MARIA CRISPINA B. BUENSUCESO1

ENGR. CARMELITA J. VILLANUEVA

All rights reserved.

Maria Crispina B. Buensuceso

Table 1. Economic Impacts of Neurath Facility in Germany ................................................ 40

Figure 1. Power Generation from Coal ................................................................................ 14

Currency Conversion: 1 USD = 52.08 PHP

PHASE I – Industrial Profile and Market & Economics

Power Generation Development

Fuel Oil for Electricity Generation

The Coal-Fired Power Plant Industry

Figure 1. Power Generation from Coal

A Brief History of Electricity in the Philippines

In 1969, the National Electrification Administration (NEA) was created by Congress to

The Philippine Electricity Sector

Figure 2. Philippine Electricity Segmentation

Philippine Total Power Consumption vs. Generation

Philippine Dependable Capacity vs. Peak Demand

Power Generation (Renewable vs Non-Renewable)

Philippine Power Consumption vs. Generation per Grid

Sual Power Station

Station Capacity: 1218 Megawatts (MW)

These processes will be discussed further in Phase 2 of this paper.

Coal Consumption for Power Generation

Figure 16. Total Coal Imports per Country in 2016

To expound as to why coal is advantageous over other sources of electricity is because

Total Power Generation Mix in Visayas

Figure 19.Total Generation Mix (based on 12955 MWh) in Visayas as of 2016

Total Generation Mix in Mindanao (11345 MWh)

Coal Power Plant Dependable Capacity Mix in Luzon

Coal Power Plant Dependable Capacity Mix in Visayas

Total Philippine Power Consumption per Sector

Country Ranking in ASEAN:

0 20 40 60 80 100 120 140

Figure 26. Total Coal-Sourced Power Generation in ASEAN by Country

Figure 27. Coal-Fired Power Generation by Country (2016)

Figure 28. Neurath Power Station

Economic Outlook and Forecasting

Grid Peak Demand Forecast

Projected Electricity Demand Per Source

Figure 31. Projected Electricity Demand per Source

Laws and Policies

Through EPIRA, the monopoly of the government-owned National Power Corporation

Renewable Energy Law

PHASE II – Plant Operations

Figure 32. Types of Coal

Table 2. Raw Materials Used (April 2014-May 2015)

Raw Material Unit Amount

Table 3. Cost Analysis of Raw Materials

Raw Material Price (USD) per Unit Price (USD)

The calculations above do not include the taxes of imported materials.

Figure 33. Sual Power Station Process Flow Diagram

Feed Water Pre-Treatment

Table 4. Total Water Withdrawal (April 2014 to March 2015)

Water Source Volume (m3)

Figure 34. Sample Coal Bunkers

Figure 35. Cross Section of a Pulverized Coal Boiler

Figure 36. Sual Power Station Boiler (Unit 1)

Furthermore, it produces a boiler maximum continuous rating (BMCR) steam flow of

By-Products and Further Processing