San Miguel: From Coal Dependence to Renewable Solutions

One of the coun­try’s largest elec­tric­ity pro­duc­ers—one that is heav­ily re­liant on coal—sur­prised mar­ket watch­ers re­cently by an­nounc­ing a strate­gic shift away from the cheap but en­vi­ron­men­tally dam­ag­ing power source.

At the same time, San Miguel Corp. (SMC) said it would be adding re­new­able en­ergy to its power port­fo­lio, us­ing tech­nolo­gies that would sig­nif­i­cantly cut its car­bon foot­print while con­tin­u­ously ad­dress­ing the coun­try’s need for re­li­able and af­ford­able power.

“We’re ex­e­cut­ing on our plans to move away from build­ing new coal fa­cil­i­ties, de­spite new tech­nolo­gies that make them cleaner,” San Miguel pres­i­dent Ra­mon Ang said last month. “It’s a com­pany di­rec­tion that is in line with all the sus­tain­abil­ity ini­tia­tives we have un­der­taken these past cou­ple of years.”

The com­pany dropped plans to put up three new clean-coal power plants with a ca­pac­ity of 1,500 MW in fa­vor of new fa­cil­i­ties that use cleaner, re­new­able en­ergy sources.

Tran­si­tion

The com­pany has al­ready started its tran­si­tion to cleaner en­ergy with the on­go­ing con­struc­tion of 31 Bat­tery En­ergy Stor­age Sys­tem (BESS) fa­cil­i­ties all over the coun­try.

The BESS fa­cil­i­ties will have a to­tal ca­pac­ity of 1,000 MW and are set for com­ple­tion from 2021-2022. Ac­cord­ing to Ang, they rep­re­sent San Miguel’s fullscale so­lu­tion to fix power qual­ity is­sues in the elec­tric­ity grid.

The project will al­low the in­te­gra­tion of more than 3,000 MW of in­ter­mit­tent re­new­able power sources to the grid.

SMC main­tains a di­verse power port­fo­lio uti­liz­ing re­new­ables and tra­di­tional.

“This is to en­sure that as we tran­si­tion to cleaner sources, we will not un­der­mine our com­mit­ment to meet the grow­ing de­mand for af­ford­able and re­li­able en­ergy.”

As such, San Miguel’s power unit, SMC Global Power Hold­ings Corp., will also put up so­lar plants in com­bi­na­tion with bat­tery stor­age fa­cil­i­ties in 10 lo­ca­tions through­out the coun­try, to be op­er­a­tional by 2023.

The com­pany is spend­ing about $1 bil­lion to si­mul­ta­ne­ously build 31 new bat­tery en­ergy stor­age fa­cil­i­ties na­tion­wide, with a rated ca­pac­ity of 1,000 MW.

 

New tech­nol­ogy

The com­pany com­pleted in 2018 the very first bat­tery en­ergy stor­age fa­cil­ity in the coun­try in its power plant in Masin­loc, Zam­bales.

The project us­ing rel­a­tively new tech­nol­ogy is ca­pa­ble of im­prov­ing power qual­ity through­out the grid and fa­cil­i­tate in­te­gra­tion of re­new­able power sources into the coun­try’s gen­er­a­tion port­fo­lio.

The tech­nol­ogy is also a ma­jor step to­wards mak­ing in­ter­mit­tent re­new­able en­ergy more vi­able in the coun­try.

“Our on­go­ing in­vest­ment in bat­tery en­ergy stor­age fa­cil­i­ties will greatly ben­e­fit power con­sumers all over the coun­try, be­cause this will mean that even far­away ar­eas can have the same sta­ble and good qual­ity power sup­ply as ev­ery­where else,” Ang said.

“This means prov­inces and is­lands will have bet­ter and equal op­por­tu­ni­ties for in­dus­tri­al­iza­tion and eco­nomic growth,” he added. “If pre­vi­ously some ar­eas could not at­tract in­vest­ments be­cause of un­sta­ble or poor power sup­ply, bat­tery en­ergy stor­age will make power sup­ply more sta­ble and re­li­able. Bat­tery stor­age will sig­nif­i­cantly re­duce im­bal­ances in the grid that cause power in­ter­rup­tions and brownouts.”

The San Miguel chief said the tech­nol­ogy would boost flex­i­bil­ity of the coun­try’s power grid and im­prove power qual­ity by re­mov­ing ex­cess power and in­ject­ing re­quired power at strate­gic ar­eas within the grid within mil­lisec­ond level.

This en­sures power qual­ity is main­tained and that it reaches power users all over the coun­try.

“This can even sup­port equal-op­por­tu­nity in­dus­tri­al­iza­tion in many prov­inces where his­tor­i­cally, no in­dus­trial plants would lo­cate be­cause of poor power qual­ity,” Ang said.

It can also ad­dress the in­her­ent prob­lem of re­new­ables, which is in­ter­mit­tence, which sig­nif­i­cantly ag­gra­vates the poor qual­ity of power in the grid.

“With strate­gi­cally lo­cated bat­tery stor­age fa­cil­i­ties, this can be mit­i­gated and re­new­ables can be­come more vi­able,” he said.

 

This story was first published in the August 27, 2021 issue of the Philippine Daily Inquirer’s Road to Clean Energy special report.