Let the ‘Monster in Morong’ sleep

By Loretta Ann Rosales

Vice president, Freedom from Debt Coalition

Philippine Daily Inquirer First Posted 05:50:00 03/15/2009

(Editor’s Note: In the spirit of fair play, we are running the side of groups opposed to a proposal to activate the 600-MW nuclear power plant that the Marcos regime built in Morong, Bataan. Last week, Pangasinan Rep. Mark O. Cojuangco said, in an article that appeared here, that nuclear power was the cheapest and safest source of electricity.)

THE BATAAN Nuclear Power Plant (BNPP) is a glaring representation of the country’s fraudulent, wasteful and useless debts. The Freedom from Debt Coalition (FDC) also sees it as a symbol of the Philippine struggle against a debt-driven development strategy – often peppered with rent seeking and cronyism – that different administrations, including the current one, have espoused.

To revive the BNPP would be to create bigger social deficits and push the people deeper into the debt and underdevelopment trap. We believe that to make the “Monster in Morong” operational would be to gamble away the people’s lives on a lost deal.


Representative Mark Cojuangco is trying to make it appear that there will be a shortage of 3,000 MW before 2012. So, he is proposing the revival of the BNPP to address at least 20 percent of the projected shortage. This faulty claim reflects the government’s track record in forecasting electricity.

In 1993, the Ramos administration projected a 10-percent annual growth in demand for electricity over the next 10 years. This growth in demand failed to materialize. Government data also showed that installed capacity and dependable capacity of generation plants were greater than demand in 1990- 2001.

For more than a decade now, over-projecting demand has led to an overcapacity in the Philippine electricity sector, and this has been proven to be as expensive as (if not more than) a power shortage. As of end-2007,

Department of Energy data showed an excess capacity of 4,218 MW on a national level.

The inaccurate forecast has resulted in burdening government, by incurring more debts, and consumers by exacting additional charges for unused electricity, thanks to the “take or pay” clause in the contracts the Ramos administration signed with independent power producers.

Weak demand

Possibly taking cues from the current BNPP debate, Energy Secretary Angelo Reyes recently ordered the review of the country’s energy plan, noting that demand has been on a downtrend in Luzon though supply has remained tight in the Visayas and Mindanao. Let the ‘Monster of Morong’ sleep By Loretta Ann Rosales Philippine Daily Inquirer First Posted 05:50:00 03/15/2009 Reyes said the “reduced requirement for electricity would defer the critical periods for increasing power supply in Luzon, while supply remains tight for [the] Visayas and Mindanao.” His statement contradicts the BNPP bill’s premise.


One possible justification for the operation of a nuclear plant is to meet an increase in base load, or replace existing base load supply. An increase in base load is highly unlikely in times of economic crisis. However, it is a much worse option to replace the existing base load supply, as the current generators are the environmentally safe geothermal and hydroelectric plants that are necessary in climate crisis mitigation.

The Cojuangco bill says government may raise equity of up to $1 billion either through a surcharge of 10 centavos/kWh on the electricity generated or through loans.

Nowhere in the world has the reconstruction of nuclear power facilities been right on schedule and on budget.

The cost of constructing the BNPP itself skyrocketed from the initial estimate of $600 million to $2.3 billion at the end of the construction period, not to mention the $640 million in interest payment.

Moreover, nuclear plant operations will require government financial support, particularly when we factor in the purchase and safe transport of uranium fuel. Given the limited supply of uranium that is reported to be processed only in six countries, chances are we could become hostage to a possible cartel if we continue with nuclear energy.

How true is it to say that the BNPP has been fully paid for, and will therefore not incur expenditures in the current budget?

Payment continues

In the books of the national government, the debts from the BNPP, including those converted into costly Brady Bonds in 1992 and retired in May 2007, have been paid.

However, government borrowed more money, through the issuance of sovereign bonds, to repay and retire these debts. So perhaps, in a narrow accounting sense, the BNPP debt is paid, but we are no less indebted. We continue to pay for this monster.

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