The ghosts of Bataan: Will Philippines see a new era of nuclear energy soon?

The ghosts of Bataan: Will Philippines see a new era of nuclear energy soon?

The Philippines, a nation of 100 million inhabitants scattered over 7,000
islands, has all the makings for a solid nuclear industry, as well as
tremendous baggage and legacy. Can a new partnership with a nuclear elder
statesman see the Southeast Asian archipelago through to a new era?

Mercurial background

The history of the Filipino nuclear industry is one that is best defined as
mercurial. Off to a great start in the late 1950s with the initiation of the
Philippine Atomic Energy Commission (PAEC), the industry enjoyed the backing
of dictator Ferdinand Marcos and with the advent of the Global Oil Crisis,
the Philippines' first nuclear power plant was commissioned in mid 1973. The
Bataan Nuclear Power Plant has since become Asia's greatest white elephant -
mired in all too familiar corruption and controversy and despite being
completed, the flagship energy project never produced a watt of power. The
century old American energy rivals GE and Westinghouse went head-to-head
before a presidential committee. GE tender was $200m more costly but the
Westinghouse proposal, which came in at $500m, included few specifications.

The presidential committee went with GE, which was summarily revoked by
Marcos despite the lack of specs with the rival proposal. Costs ballooned to
$1.2m on the Westinghouse-won project. It was subsequently discovered that
Westinghouse was selling similar technology to other emerging nations at
less than half the price of the mounting invoices (also with little detail)
being sent to PAEC. Backroom graft had clearly poisoned the project from the
start but problems persisted. Following Three Mile Island, several thousand
defects were discovered in the Bataan project while still under
construction, incredibly, nobody in power had thought that the fact that
Bataan was on a fault line and on the foothills of Mount Pinatubo as
particularly relevant to the choice of site. Bataan was doomed. Eight years
in costs had swelled to five time the tender, Marcos was overthrown and
Chernobyl occurred. Nuclear - and Bataan - fell completely out of favour.
The succeeding Aquino administration abandoned the plant and found that it
was not economically prudent to convert to less controversial energy
sources. Bataan is now a very expensive tourist attraction.

Letting go of the past

Power Management Specialist at PSALM Corp, Luisito Samsin, who is in charge
of the privitisation of NPC assets, is clear, "Mostly politics play a
'not-so-needed' role in plans to build a nuclear plant. [Indeed], this is
the right time to start planning, so that we can have one plant erected five
years from now. The plan within the nuclear industry in the Philippines is
to operate the Bataan Nuclear Plant. I believe we should forget about Bataan
and build a new plant."

Samsin's point seems to support the majority sentiments about the ailing
site. "Bataan is already old and there are new technologies available which
are safer, cheaper and easier to operate. As a nation, we should focus on
developing other site for building a nuclear plant."

Cynthia Hernandez, an energy consultant at KPMG, Manila, is equally
forthright, when asked if the Philippines can overcome the ghosts of Bataan,
"To be blunt, I don't think so." She even suggests that the very
establishment of a nuclear power sector will face barriers. "There is
actually a strong case for a 1,000-2,000 MW nuclear power plant [be it
Bataan or not] for baseload demand." Nonetheless, Hernandez expects heavy
resistance from the powerful fossil fuel industry, "this will probably be
opposed by owners and developers of coal power plants, as it will affect
their capacity utilisation significantly."

Not all commentators agree with Samsin and Hernandez however, some arguing
that nuclear will prevail and even that not all is lost with the Bataan
site, suggesting that rather than simply a stay of execution, the
controversial Duterte Administration may provide Bataan with a full
reprieve. Dr Soledad Castaneda, Chief of the Atomic Research Division of the
Philippine Nuclear Research Institute, who is responsible for providing
direction and guidance in the planning of the Institute's R&D activities,
reminds us that just three years ago the Department of Energy spearheaded a
local community forum on the resurrection of Bataan and that surprisingly
opinions were mixed, "The activity was geared towards gauging the impression
of the people on the possible rehabilitation of the existing nuclear plant.
Following the conduct of the forums, the DOE believes that the BNPP complex
should be preserved pending a final decision by the government on the
utilisation of nuclear energy for power generation." Adds Castaneda, "Recent
pronouncements from the Duterte Administration supports the strategy to
continue studies regarding nuclear energy as a long-term option for the
country."

Most recently.

Regarding Bataan, last year, government officials visited the controversial
site. Inspecting senators (not nuclear experts) held a press conference
concluding that Bataan was in good condition. It was later discovered that
more than two thousand defects existed. More broadly Castaneda concedes that
there the standard difficulties that exist with the development of a nuclear
sector remain, regardless of the challenges centering on site-choice. These
include, strengthening the value-chain of R and D from concept to market in
terms of nuclear energy for power generation, human resource development,
public awareness and acceptance, and strengthening nuclear regulatory
framework - although stakeholder involvement and international linkages are
continuously being enhanced.

Even if the Philippines looks to another site altogether, as advised by
Samsin, a lot of big questions need asking. After all, the drive today is
renewable energy. Having a five-year plan for a NPP will serve as an
experiment to truly discover if the Philippines will, can, or even wants to
proceed with including nuclear in the energy mix. It must be asked though
with one grossly expensive experiment seemingly down the drain, why would
the Philippines take this costly risk yet again?

Enter international linkages and stakeholders

Right on cue, international interest and stakeholder involvement is on the
way. After decades of looking toward the United States and Korea for nuclear
consulting and partnership, the Duterte Administration has given a nod to
the Russian State Atomic Energy Corporation, Rosatom. The signing of the
memorandum of co-operation for the peaceful use of atomic energy signals a
serious commitment by the government to perhaps move away from traditional
fuel sources in the future.

The Memorandum's objectives include the development of the bilateral
cooperation in peaceful uses of atomic energy in such areas as radiation
technologies, experimental and functioning reactors construction and
operation of nuclear power plants. Says CEO of Rosatom Alexey Likhachev,
"The [Memorandum] offers our countries opportunities to cooperate in science
and engineering in peaceful uses of atomic energy while making it possible
to develop practical application of nuclear technology in healthcare,
agricultural, and many other crucial sectors of the Philippines' economy. We
are willing to share unique experience of the Russian nuclear industry with
our partners including cooperation in personnel training and public
acceptance of nuclear power."

According to Dr Castaneda, the Philippine government clearly recognises that
the applications of nuclear energy in certain identified areas such as those
outlined in the MoC, will contribute to achievement of Sustainable
Development Goals. "The application of nuclear has benefitted the
agricultural, health and medicine, industrial, and the environment sectors.
and still many applications have to be explored. For its application as a
power source, the government must come up with a national position."
Collaboration with top-tier international experts with a long history and
vast experience is essential.

The Philippine Government has a firm and growing relationship now via the
MoC with Russia, and the timing could not be better if the Archipelago is
ever going to "go nuclear" and either do something--anything--with Bataan or
just bury it and start afresh. In fact just last week, a delegation of 42
Vienna-based permanent representatives of foreign countries to international
organisations visited Saint-Petersburg to view Russia's advanced nuclear
power technologies. Speaking on the Russian tour, Permanent Representative
of the Philippines to the United Nations, Maria Zeneida Angara Collinson,
said, "I am very impressed by the cutting-edge technology that we were shown
today. It is a huge responsibility for Rosatom, for the city of Saint
Petersburg to ensure that this cutting-edge technology not only benefits the
people in the world, but also ensures safety. If Rosatom is able to do this,
it will be the world leader in many respects." Permanent Representative
Collinson continued, "We are actively considering including the nuclear
power in our energy mix. Because the Philippines is composed of many
islands, we are an archipelago, perhaps, the floating nuclear power plant
could be an answer to develop and industrialise the far-flung islands in the
Philippines."

The fundamental problem remains familiar with emerging nuclear players, and
is well-summarised by Hernandez, "The MoC is really for the Philippine
government to increase the understanding and expertise relating to nuclear
energy. Because government initiatives really take a lot of time, I am not
overly optimistic about its significance." However with a hugely experiences
first generation nuclear nation chaperoning the burgeoning east Asian state,
its chances of achieving nuclear power are better than ever.

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Link to Original Article:
http://asian-power.com/regulation/exclusive/ghosts-bataan-will-philippines-s
ee-new-era-nuclear-energy-soon

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com