STATUS OF ENERGY SECTOR IN BARMM

Improving Access to Electricity and Operation of Electric Cooperatives

The current operation of power sector in the Bangsamoro Region is facing with
standing issues that need an immediate actions of the Bangsamoro government.
These issues are (1) power supply shortages, (2) aged distribution facilities, (3) high
distribution loss rate, and (4) low electrification rate.

BARMM is dependent on hydropower considering its Archipelagic Nature and

has total installed capacity of 260MW which is supplied by Agus 1 and 2 located at
Marawi and Saguiaran, Lanao Del Sur.

Table: Existing Hydroelectric Power Plants

Plant Capacity (MW) Location

Installed Dependable
Large Hydroelectric Plants
Agus 1 units 1 & 2 80.00 50.00 Marawi City, Lanao
Del Sur
Agus 2 260.00 172.00 Saguiaran, Lanao
Del Sur
(Source: Mindanao Energy Plan 2014-2030)

There are also 15 NPC-SPUG power plants in the region with total installed
capacity of 49.30 MW and dependable capacity of 35.00 MW. For the planning period,
expected capacity addition in the region’s SPUG areas is about 60 MW.

Table: SPUG POWER PLANTS, as of November 2013

SPUG Plant Capacity (MW) Operating Location

Hours
Installed Dependable
Sulu* 15.54 10.40 24 Sulu
Tawi-Tawi* 6.49 4.16 24 Tawi-Tawi
Basilan* 20.05 14.40 24 Basilan
Cagayan de 1.02 0.80 8 Tawi-Tawi
Tawi-Tawi
Balimbing 0.73 0.65 8 Tawi-Tawi
Manuk 0.16 0.15 6 Tawi-Tawi
Mangkaw
Sibutu 0.33 0.28 6 Tawi-Tawi
Sitangkay 1.16 0.99 6 Tawi-Tawi
Tandubanak 0.44 0.38 6 Tawi-Tawi
Tandubas 0.26 0.22 6 Tawi-Tawi
West Simunul 0.73 0.63 6 Tawi-Tawi
 Luuk 0.33 0.29 8 Sulu
Siasi 2.08 1.65 20 Sulu
Total 49.30 35.00
Note: * The large SPUG plants in these areas were combined
(Source: Mindanao Energy Plan 2014-2030, DOE)

Challenges in the Power Sector in BARMM

The current status of electric cooperatives in BARMM is alarming. There are

needs to support rehabilitation program of the ECs in order to provide reliable access to
electricity. The power sector rehabilitation and expansion program across the
Bangsamoro region must be initiated to prepare the region for future industrialization.

1. Power Supply Shortage

Power shortage in Mindanao is one of the critical issues in the power sector.
The load curtailment is being conducted almost everyday in accordance with the rule that
the areas and regions where there are lots of residents not paying electric tariff are
targeted for the load shedding. This means that Electric Cooperatives (ECs) having low
rates of tariff collection and poor financial status are targeted for the load shedding.
Therefore, it is required to improve ECs’ financial status by improving this low rates of
tariff collection so that they are excluded from the target of the load curtailment.

2. Aged Distribution Facilities

Many distribution facilities, especially in the MAGELCO franchised area, were

installed in the late 1970s and 1980s. Approximately 60% of the poles are bended and
seriously deteriorated. Illegal connections of service wires and breaking of kWh meters in
the area are rampant in the franchised area that is why MAGELCO is suffering in tariff
collection and results to its last place in rank according to the performance assessment by
the National Electrification Administration (NEA).

The rehabilitation and expansion of distribution lines and substations can

contribute to the reduction of systems loss. Replacement of old electricity meters or
energy meters are also important to provide accurate billing amounts for member-
consumers. In order to realize this, the ECs may secure their own budget by requesting
NEA for financial assistance or the Bangsamoro government for financial allocations
with stringent measure on how budget will be utilized, and/or request international
donors for financial and technical assistance.

In the case of island provinces, the electric cooperatives must be proactive in

conducting studies and recommend innovative ways to rehabilitate their facilities and
generate more energy from renewable energy sources to meet their energy requirements.
(Source: Unified Bangsamoro Development Plan)
3. High Distribution Loss Rates

According to the performance assessment of ECs conducted by NEA which is

also published in DOE website, the distribution loss rates for every EC in the region is
shown on the table below.

Electric Cooperative (EC) Location/Province Distribution Loss Rate

MAGELCO Maguindanao 27.69%

BASELCO Basilan 30.22%
SULECO Sulu 31.05%
TAWELCO Tawi-Tawi 23.98%
LASURECO Lanao del Sur 38.21%
SIASELCO Siasi, Sulu 10.21%
CASELCO Cagayan de Sulu -
(Source: Department of Energy)

These values are classified as a high rate compared to rates in neighboring

Southeast Asian countries which have average systems loss rate of 12–15%.

Distribution loss is classified into two categories. First is Technical Loss which
means electric loss such as a heat loss which is generated by flowing current inside line
conductors. Second is the Non- technical Loss which means a loss mainly due to the
uncollectible electric tariff. In the case of BARMM the high loss rate is due to the second
category leading to financial difficulty and deficit operation of ECs.

The main causes of low tariff collection rates are: 1) broken kWh meters, 2)
utilization of outdated kWh meters with low accuracy, and 3) illegal connections of
service wire, known as pilferage. As an example of power sales by MAGELCO, power
purchase is 2,895,668 kWh and power sale is 1,626,863 kWh in October 2014.
Accordingly, the power loss and loss rate are calculated at 1,247,087 kWh and 43.07%,
respectively. (Source: Unified Bangsamoro Development Plan)

To address these problems, there is a need to promote better public relations

between the electric cooperatives and its member-consumers. These activities will help
establish the feeling of mutual accountability on use and maintenance of the facilities
along with the efforts of the Bangsamoro government to provide better services for the
people of BARMM.

4. Low Level of Electrification

A total of 2,441 out of 2,447 target barangays in BARMM are energized as of

November 2018. However, in terms of electricity connection, the region has 201,037
households or 33 percent of the 600,700 potential service connections.3
 BARMM energization coverage in sitios has the lowest development rate among
the six regions in Mindanao. This represents 919 sitios yet to be energized out of the
2309 coverage sitios.

BARMM is beset with constant power interruptions especially in far-flung sitios

and barangays. This has been a major bottleneck for economic development in the
region.

STATUS OF ELECTRIFICATION IN BARMM

As of November 30, 2018 (from NEA)
ELECTRIC MUNICIPALITI BARANGAYS SITTIOS CONNECTIONS
COOPERATIVES ES/CITIES
  COVER % Poten Ener % Poten Energ % UN Poten Served %
AGE/ tial gized / tial ized / ENER tial To
ENERG Comple Comp GIZE Date
IZED ted to leted D
Date to
Date
Tawi-Tawi Electric 9 100 186 186 10 355 242 68 113 61,500 12,822 21
Cooperative, Inc 0
Siasi Electric 2 100 66 66 10 76 41 54 35 17,500 4,258 24
Cooperative, Inc 0
Sulu Electric 16 100 330 330 10 86 71 83 15 118,00 27,511 23
Cooperative, Inc 0 0
Basilan Electric 14 100 269 269 10 247 191 77 56 88,000 45,288 51
Cooperative, Inc 0
Cagayan de Sulu 2 100 17 17 10 87 28 32 59 5,200 3,155 61
Electric Cooperative, 0
Inc.
Lanao del Sur Electric 41 100 1175 1175 10 136 68 50 68 156,00 56,475 36
Cooperative, Inc 0 0
Maguindanao Electric 30 100 404 398 99 1322 749 57 573 154,50 51,528 33
Cooperative, Inc 0
Sub-Total 114 100 2447 2441 99 2309 1390 60 919 600,70 201,03 33
0 7
(Source: 3 National Electrification Administration)

Recent Initiatives and Strategies in the Energy Sector

Before the advent of BARMM, the previous ARMM government doesn’t have any
control, authority and power to directly influence the energy sector in the region. The
DOE is the sole agency with this mandate.

After the ratification of R.A. 11054, in coordination with the

intergovernmental relations office and intergovernmental energy board, BARMM
Ministry of Environment, Natural Resources and Energy (MENRE) obtained the
authority to prepare, coordinate, supervise and control all plans, programs,
projects and activities of the Government relative to energy exploration,
development, utilization, distribution and conservation. BARMM can also create
new GOCCs which is responsible for Electrification Development Programs such
as the implementation of Rural Electrification Program through electric
distribution utilities (EDUs), particularly the electric cooperatives (ECs).
 In order to address the recurring power issues in the region, some of the
recommended actions are: 1)  to establish the strict rule of tariff collection and strict
disconnection and reconnection policy, 2)  to replace aged/broken kWh-meters to new
ones with accuracy and implement accurate meter-reading, 3) to promote awareness
campaign to consumers regarding tariff payment, 4)  to prevent illegal connections by
regular monitoring, and 5) to identify only authorized person/s who shall exercise the
connection, disconnection and reconnection process among consumers.

It is also recommended to introduce additional power generation facilities such as

small power plants and power resources with renewable energy which is connected to the
distribution grid. Since ECs are not permitted to introduce and own huge power
generation facilities due to the EPIRA Law, attracting independent power producers
(IPPs) to invest in the region is important for the future power demand of BARMM.

Opportunities in the Energy Sector

BARMM is one of the richest regions in Mindanao when it comes to energy

resources. It is well endowed with indigenous energy resources such as Oil, Natural
Gas, Coal, Solar, Hydropower, Geothermal, Wind, and other Renewable Energy
Resources. Provisions of right investments in harnessing and developing these energy
resources may aid and spur economic development in the region. These energy resources
can be an avenue to solve the perennial problem of BARMM in power generation and
distribution.

Energy Resources in BARMM

1. Fossil Fuels

Looking at the oil and gas potentiality of the entire Mindanao, BARMM region
has two of the largest oil and gas basins in the country namely Sulu Sea and Cotabato
Basin. Cotabato Basin is located in the southern part of Mindanao mainly in the province
of Maguindanao and Cotabato. Cotabato Basin has an area of 14,000 square kilometers
and estimated to have total resource potential of 158 million barrels (MMB) of oil
equivalent. Oil potential has been estimated at 83 MMB, while its gas potential stands at
418 billion cubic feet (BCF). Another huge source of oil and gas in BARMM is the Sulu
Sea Basin which is located in Western Mindanao and has an area of 115,000 square
kilometers and estimated to have total resource potential of 203 MMBFOE, of which oil
potential stands at 130 MMB and gas at 409 BCF. 1 (Source: 1 Mindanao Energy Plan
2014-2030, DOE in partnership with MinDA)

2. Coal

Coal is likely to remain a major fuel for power generation in the future despite of
its environmental challenges. The Philippine government is continuously promoting the
exploration and development of indigenous coal resources in the country. BARMM has
one of the biggest potential coal reserves in the country located at the province of
 Maguindanao. Maguindanao has been proven to have a significant amount of coal
estimated at 108 million metric tons (MMMT).

3. Renewable Energy

In the Philippines, renewable energy (RE) is being gradually introduced since the
promulgation of Renewable Energy Law enacted in 2008, which aims to protect the
environment and ensure national energy security. In the National Renewable Energy
Program (NREP), the Department of Energy (DOE) formulated a development plan
which introduces Renewable Energy as alternative energy source such as Geothermal,
Hydropower, Biomass, Wind, Solar and Ocean Energy. In accordance with this national
policy agenda and the powers stated in the RA11054 (BOL), the Bangsamoro may also
develop its own regional Renewable Energy Program.

4. Hydropower

According to the MEP (Mindanao Energy Plan 2014–2030), it is estimated that

the hydropower potential in the Philippines is equivalent of 1,379.32 MW with 238
potential sites identified in Mindanao. Of the total potential resources, DOE identified 17
potential sites inside the BARMM territory which could provide a total aggregate
capacity of 27.15 MW.

Table: Hydro Power Potential Sources in BARMM

Province / Project Name Potential Pre-development investment

Location capacity (MW) requirement (PHP 106)
Maguindanao 5.23 562.23
Upi Kiga Falls 1 0.6
Upi Kiga Falls 2 0.6
Upi Kiga Falls 3 0.8
Dinaig Sapalan Falls 0.5
Parang Bugasan 0.24
Parang Nituan 0.51
Buluan Balali 0.33
Datu Odin Sifaran 1.65
Sinsuat
Lanao Del Sur 11.29 1,213.68
Malabang Kanapnapan Falls 9.60
Malabang Muda 0.14
Puala Panitan Falls 0.20
Balabagan Abunabun Falls 0.28
Balabagan Salanga 0.4
Poo-Abayabao Gata 1 0.28
Masiu Malalig Falls 0.39
Sulu 10.63 1,142.73
Maimbung Maimbung 0.13
Esperanza Wawa A(SHP) 10.5
Total 27.15 2,918.64
5. Solar Energy

Solar energy is one of the most promising RE resources in Mindanao. Studies

conducted by National Renewable Energy Laboratory (NREL) indicated that Mindanao
Island has high potential power generating capacity with an average amount of 5–5.5
2
kW/m /day.

BARMM is a recipient of two awarded solar projects with an estimated total

potential capacity of 37 MW. These awarded projects are the 2-MW Tawi-Tawi Solar
project in Balimbing, Tawi-Tawi and the 35-MW ICOM Solar Power Project located
in Marawi City, Lanao Del Sur which was initiated by the Local Government Unit
(LGU) of Marawi City.

6. Geothermal Energy

The Geothermal power potential resources estimated as of December 2013 are

290 MW in Mindanao. Table below shows the geothermal power potential resources in
the BARMM. As of January 2015, no addition of geothermal power plants is planned in
the ARMM.

Table: Number of Geothermal Sites and Potential Capacities in BARMM

Province No. of sites Potential capacity Pre-development investment

(MW) 6
requirement (PHP 10 )
Maguindanao 8 5.23 562.23
Lanao Del Sur 7 11.29 1,213.68
Sulu 2 10.63 1,142.73
Total 17 27.15 2,918.64

7. Biomass Energy

Mindanao is endowed with rich biomass resources due to its inherent high land
productivity. According to the biomass potential map issued by the DOE, rice bagasse
potential resources are estimated to be at 4.47 MW and coconuts at 84.87 MW. As of
January 2015, two projects of biomass power plants in Maguindanao province were
ongoing and scheduled for commissioning by the end of 2015. The output of each power
plant is 1.6 MW and 10 MW, respectively.

Currently, there are two (2) existing Biomass Facilities in BARMM. The 3-MW
Biomass Cogeneration Facility operated by the Philippine Trade Center, Inc. located in
Sultan Kudarat, Maguindanao. And the 15-MW Biomass Power Plant Project awarded
to Lamsan Power Corporation in the same area (As of January 2014).
8. Ocean Energy

BARMM region is also rich in ocean Energy due to its archipelagic nature.
There are 5 identified tidal and ocean energy potential sites in the region. Two of these
are located in Sulu and three are located in Tawi-Tawi. The said projects are estimated to
have total potential capacity of 8 MW. (see table below)

Table: Ocean Energy Potential Sources in BARMM

Location Plant Estimated Capacity (MW)

Sulu Baculus-Bulaan Island 1.00
Lugus-Tapul Island 2.50
Tawi-Tawi Northern Sibutu 2.50
Sibutu Island 1.00
Simunul 1.00
Total 8.00

Source: DOE, Mindanao Energy Plan, 2014-2030