Republic of the Philippines Data Collection Survey on the Incentive Mechanism for Improving Disaster Resiliency of Electric Power Distribution Network Final Report
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Republic of the Philippines National Electrification Administration (NEA) Republic of the Philippines Data Collection Survey on the Incentive Mechanism for Improving Disaster Resiliency of Electric Power Distribution Network Final Report October 2015 Japan International Cooperation Agency (JICA) Shikoku Electric Power Co., Inc. (YONDEN) The Japan Economic Research Institute (JERI) 1R JR 15-053 Data Collection Survey on the Incentive Mechanism for Improving Disaster Resiliency of Electric Power Distribution Network: Final Report Contents Chapter 1 Situation of the Energy Sector ............................................................................................ 1 1.1 Economic Conditions in the Philippines .................................................................................... 1 1.2 Current Situation of the Energy Sector in the Philippines.......................................................... 3 1.3 Natural Disaster in the Philippines – Type and Impact .............................................................. 5 Chapter 2 Current Condition of the Power Network in the Philippines ............................................. 8 2.1 Response Organization at Disaster ............................................................................................. 8 2.2 EC Damage and Response Status Information Gathering ........................................................ 14 2.3 ECs’ Capital Investment Plans ................................................................................................. 21 2.4 Financing of ECs ...................................................................................................................... 23 2.5 NEA’s Current Systems of ECs’ Performance Assessment ...................................................... 31 2.6 Human Resource Development Plan ........................................................................................ 38 Chapter 3 Power Network Resiliency in the Philippines with Focus on Distribution Assets ........... 41 3.1 Technical Aspects ..................................................................................................................... 41 3.2 Financial Aspects ..................................................................................................................... 50 Chapter 4 Proposal of Rating and Incentive Systems Based on Disaster Resilience Evaluations .... 56 4.1 Experiences in Japan: Overview of Development Bank of Japan BCM Rating ...................... 56 4.2 Methodology to Introduce BCM Rating for ECs ..................................................................... 57 4.3 Implementation Framework within NEA ................................................................................. 58 4.4 Monitoring Mechanism ............................................................................................................ 59 4.5 BCM Rating Item Proposal for ECs ......................................................................................... 60 4.6 Rating Methodology................................................................................................................. 66 4.7 Financial Incentives in the BCM Rating .................................................................................. 66 4.8 Response to Cost Impact .......................................................................................................... 68 Chapter 5 Management and Enhancement of Operation of Rating and Incentive Systems Based on Disaster Resilience Evaluations ....................................................................................... 71 5.1 Analysis of the Cost-Effectiveness of Costs for Disaster Resiliency-Related Investment ....... 71 5.2 Future Expansion of the Application ........................................................................................ 82 5.3 Recommendations .................................................................................................................... 90 Data Collection Survey on the Incentive Mechanism for Improving Disaster Resiliency of Electric Power Distribution Network: Final Report List of Figures Figure 1 EC map ........................................................................................................................... 4 Figure 2 Occurrence of natural disasters in the Philippines 1980-2010 ....................................... 6 Figure 3 Typhoon prevalence and people affected per year (1990-2014) ..................................... 6 Figure 4 Disaster response organization ....................................................................................... 8 Figure 5 Pre-typhoon advisory .................................................................................................... 12 Figure 6 Post-typhoon advisory .................................................................................................. 13 Figure 7 Outline of TFK ............................................................................................................. 14 Figure 8 Answers by ECs on how to introduce the BCM rating ................................................. 58 Figure 9 Proposed operational procedure of the BCM rating ..................................................... 59 Figure 10 Relationship of assessment classifications and business continuity (3 key elements) 61 Figure 11 Image of business continuity readiness assessment framework ................................. 62 Figure 12 Power distribution grid system map used for the analysis .......................................... 74 Figure 13 Image of utility poles and power distribution lines .................................................... 74 Figure 14 Scenario typhoon track record .................................................................................... 75 Figure 15 Calculated return period of Durian and Yolanda ........................................................ 76 Figure 16 Wind speed distribution at the target area ................................................................... 77 Figure 17 Damage curves for class 5 poles ................................................................................. 77 Figure 18 Damage ratios for class 2 poles .................................................................................. 78 Figure 19 Pole span shortening ................................................................................................... 78 Figure 20 Roadmap to enhance disaster resilience in the Philippines ........................................ 95 Data Collection Survey on the Incentive Mechanism for Improving Disaster Resiliency of Electric Power Distribution Network: Final Report List of Tables Table 1 Selected macroeconomic indicators .............................................................. 1 Table 2 Philippine banking system classifications ................................................... 2 Table 3 EC general description .................................................................................. 3 Table 4 Damage situation of poles in 3 main distribution facilities hit by Typhoon Yolanda (November 2013) ........................................................................... 10 Table 5 Power situation in municipality/barangay/sitio (Ruby: December 2014) . 11 Table 6 ECs extensively damaged by Bohol Earthquake and Typhoon Yolanda . 15 Table 7 Summary table of damage situation in 3 main distribution facilities (poles, transformers, distribution lines) in EC damaged by Typhoon Yolanda .. 16 Table 8 Contingency plan of CEBECO2 .................................................................. 18 Table 9 ECs’ CAPEX plans (2015-2019) .................................................................. 21 Table 10 Types of NEA loans.................................................................................... 23 Table 11 NEA lending program interest rates ........................................................ 24 Table 12 NEA’s major lending programs ................................................................. 24 Table 13 NEA’s loan releases to ECs ....................................................................... 25 Table 14 ECs’ CAPEX funding requirements and CAPEX loan releases by NEA 26 Table 15 ECPCG indicative terms and conditions .................................................. 27 Table 16 Number of ECs with LGUGC guaranteed loans based on performance assessment rating ...................................................................................... 28 Table 17 Loans to ECs from DBP, LBP and REFC ................................................. 29 Table 18 Composition of KPS parameters and NEA’s departments in charge .... 32 Table 19 KPS performance indicators ..................................................................... 33 Table 20 Members of the KPS Technical Working Group...................................... 34 Table 21 Institutional issues and needs with regard to KPS ................................ 35 Table 22 Parameters and assessment standards of EC classification .................. 36 Table 23 Results of EC classification ....................................................................... 37 Table 24 Results of EC performance rating (tentative) (2014) .............................. 37 Table 25 Technical training for NEA and ECs ........................................................ 38 Table 26 NEA-EC Management Course .................................................................. 40 Table 27 Current