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Welcome to Boracay, the Philippines' most famous beach.

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Hello, everyone.

It's Wednesday, April 24 here in Manila.

I'm Karen Davila giving you the head start for the day.

Our guests for Hot Copy today.

First, we have maritime security expert Ray Powell as we take a closer look at the Balikatan exercises

and China's response to the annual drills.

And later on, a check on the power situation in the Philippines with attorney Cynthia Alabanza.

This is the National Grid Corporation of the Philippines, or NGCP.

But first, the headlines.

Today's big stories.

A U.S. government report says extrajudicial killings remain a serious problem in the Philippines.

Malacanang warns the public against a manipulated audio of President Marcos Jr.

supposedly instructing the military to act against another country.

And more Chinese vessels spotted in the West Philippine Sea as Manila holds joint military exercises with Washington.

On Hot Copy this morning, a heightened Chinese presence in the West Philippine Sea

as Filipino and American troops hold their annual joint drills.

Michael Belizo reports.

The Philippine Navy reveals a surge in the number of...

Chinese maritime militia vessels swarming in the West Philippine Sea

as Manila and Washington begin its annual joint military drills.

Data from the Navy showed that from April 16 to 22, more than a hundred militia vessels,

nearly a dozen Chinese Coast Guard ships, and three People's Liberation Army Navy warships

were spotted mostly in the areas of Bajao de Masinloc, Pagasa Island, and Ayungi Shoal.

It's only for this week that we have seen a surge of up to a total of 124.

124.

This particular increase is not normal.

And the reason why, I can only say it coincides with Balikatan.

Over 16,000 Filipino and American troops kicked off joint military exercises in the Philippines on Monday.

Trinidad says there are appropriate measures in place should China disrupt or interfere in the war games.

In Washington, the U.S. House of Representatives approves an $8.1 billion emergency aid package

for key allies in the Indo-Pacific, including the Philippines.

The bill...

...allocates $4 billion in security assistance, nearly $2 billion in stock replenishment,

and $3 billion in submarine infrastructure for America's allies.

Philippine House Speaker Martin Ramualdez says the measure will benefit Manila

amid escalating tensions in the West Philippine Sea.

Ramualdez lobbied extensively for the bill during meetings with American legislators at Washington, D.C. earlier this month.

Meanwhile, Commodore Trinidad clarifies the use of China-made ship as target for the joint drills,

which is just coincidental.

It's just coincidental. It's not complicated. No pun intended, no meaning to that. It's just coincidental.

The BRP Lake Kaliraya, a retired Chinese-manufactured naval asset of the Philippines,

will be used as a mock enemy target during the sinking exercises.

Navy Flag Officer-in-Command Vice Admiral Toribio Adasi Jr. said

the use of old vessels as targets during exercises is completely normal.

Just like in AD sinking exercises,

around the world, they use old vessels as the target of the exercise.

And the same thing we are doing with Lake Kaliraya.

Michael Delizo, ABS-CBN News.

Alright, joining us on Hot Copy this morning,

we have with us U.S. maritime security expert and former U.S. senior defense official, Ray Powell.

Ray, welcome back to Head Start.

Hi.

Hi, Karen. It's good to see you again.

Alright. The Philippine Navy has already said the particular increase is not normal.

That's a statement that was made during the press conference.

Let's talk about an overview.

Balikatan exercises aren't new.

This has been happening for many years,

although joint drills, for example, did not happen during the time of former President Duterte, I believe.

But what makes this particular time different?

Well, Karen, I think you start with just what's been happening over the past year and a bit.

And I think that there's just heightened tensions all around.

In addition to that, of course, you've had this repeated reminders from the United States

about the Mutual Defense Treaty obligations.

And, you know, you've got this additional, you know, for the first time now,

for a very long time, the Philippines and the United States will hold their naval drills outside.

The Philippine Territorial Seas.

Now, that's not unusual in and of itself.

I mean, mostly a lot of countries hold territorial naval exercises outside of territorial seas.

But the fact that the Philippines hasn't done it for a while makes this one look sort of unusual.

All right. Now, at this point, they say there are 124 ships.

110 of those ships are CMMVS ships.

11 are Coast Guard ships.

And three are People's Liberation Army Navy ships.

Are the number of ships and the type of ships present at this time a cause for alarm?

Not alarm, no.

So the vast majority of those ships are what we call Spratly backbone vessels.

And they don't really do anything.

They just sort of sit there.

They're paid by the government to be in the Spratly Islands.

They're essentially fishing vessels that don't fish because they don't have to.

Because China...

China pays them just to exist.

And, you know, by existing, they assert Chinese sovereignty.

A lot of those are going to be at places like Whitsun Reef or even Sabina Shoal, Iroquois Reef.

You know, the places that, you know, all they do is just sort of sit and look pretty.

There are an unusual number of the professional militia out running about.

And it would certainly...

Are you talking about the Chinese maritime militia?

The Chinese maritime militia vessels?

That's 100?

Yes.

Okay.

Yes.

Yes.

So, you know, those are divided into two kinds.

So you have the professional militia, which are a smaller number, but they are very active.

They're the ones that you see circling Scarborough Shoal, circling Ayungan Shoal, especially during the resupply missions.

So they're the more dangerous of the two.

And, of course, if the Philippines were to approach one of those shoals, they would be the ones that would be the most dangerous.

If the Philippines were to approach one of those shoals, they would be very active in doing the blocking maneuvers that we see.

I would say, you know, there's, you know, maybe three dozen of those running about.

But, again, most of the rest of the militia ships are those Spratly backbone vessels.

And the Coast Guard ships, I mean, you know, 11 of them, that sounds...

That's elevated, but I don't think it's alarming.

All right.

Now, is this helping rain?

Is this helping?

Tensions are high.

And yet drills are continued.

At this point in time, in an area which is not our territorial waters, as you've said, is this worsening our relationship with China?

You know, China will take almost anything as a provocation.

And I would say it would actually be worse for the Philippines sort of not to do this, right?

So to look like the Philippines is backing down or being intimidated.

So Balikatan is a normal exercise.

It's not like they're going off of China's coast.

They're just going out, you know, deeper into the exclusive economic zone of the Philippines.

You know, the territorial sea is actually a very, very small area of only 12 nautical miles away from the Philippine coast.

So going further away than that isn't really that unusual.

And it's probably important that the Philippines makes the point that it's not going to be intimidated.

The Philippines has been making the point it's not going to be intimidated.

And yet China isn't intimidated.

No.

And China has been certainly escalating.

I think it believes that it can escalate the Philippines, you know, out of its more assertive posture that it's had this past year.

And I think it's hoping to do so.

But this is not cost-free for China either.

You know, it takes a lot of extra resources to have all of these ships out.

Right.

And it's also costing China, I think, in a big way on the international stage.

China has a very difficult time convincing everyone that it is a benevolent, responsible power when it's out, you know, water canoning small boats and things to that effect.

So I think that, you know, China is going to have to start asking itself some hard questions.

How long does it really want to sustain this very aggressive posture because it's not cost-free?

Now, you're talking about we have, I believe, nine EDCA sites in the Philippines, a more proactive and robust relationship with the United States, joint drills happening right now, the international community speaking out in support of the Philippines when it comes to the West Philippine Sea.

And yet in the region, there are fears of violence and war.

Former President Duterte has always said, do we want to go to war?

We can't afford to go to war.

We will lose if China decides to go to war.

You've been studying this for a long time.

Ray, will China go to war?

China hasn't gone to war since 1979.

And I think that China does not want to go to war.

And I think that nations that don't want to go to war generally don't go to war.

China, what China wants to do is it wants to win without fighting.

It wants to coerce and cajole.

It's dangerous.

It's adversaries into submission.

And so it will, you know, beat the war drums.

But I think that, you know, generally speaking, I think that China is very unlikely to sort of cross that threshold

unless it thinks that it has an overwhelming chance of winning and making the endeavor worth it.

And I just don't think that China thinks that's necessarily the case.

All right.

In our last interview, we talked about what the Philippines can do proactively.

To reiterate and strengthen and reinforce the arbitral victory.

I'll start with Ayungin Shoal, for example.

China came out with a statement and said the Philippines or the Philippine government has broken three of its promises.

Number one is to tow off BRP Charamadre.

And they claim it's been there for more than 20 plus years.

So the assumption is a promise may have been made prior to the last president.

Number two, they claim.

They claim that there will be no refurbishing, no reinforcing of BRP Charamadre.

What's allowed is only supposedly the delivery of food and supplies and water,

in which another promise they claim is the Philippines would give a kids up or inform China in advance.

Let's talk about Ayungin Shoal, that particular alleged gentleman's agreement.

Yeah, you know.

So there's been some smoke around that.

And, you know, it may be this is entirely speculative that there were meetings in which some official from some administration said something that might have indicated that they would listen.

But, you know, China has never really given any details about what any of this when any of this happened, who was involved, what exactly they said.

So, you know, it's very, very hard to credit that.

And honestly.

You know, in the end, a gentleman's agreement is a gentleman's agreement between two people.

It's not it's not a signed agreement between two countries.

It's not a treaty.

It's you know, so as we know, in a democracy, every administration is different.

So I really have a hard time.

I think this is a narrative.

It's something that's very convenient to China.

But I think the more time that we spend sort of dwelling on it, the more time we're sort of just playing into their narrative.

All right.

Okay.

When it comes to a union show, being a security expert, what would it cost the Philippines or what could happen if the Philippines rehabilitates the RPC Ramadri or even there's been talk that some have said you could actually put, since it's symbolic, a newer ship.

Right.

And I think that China's entire blockade strategy has has been intended to.

Right.

And I think that China's entire blockade strategy has has been intended to.

Right.

To prevent that exact thing.

You know, I think that, you know, they're very sensitive to seeing a larger ship enter the show because they're afraid of exactly that, that it would just simply run itself aground next to the Sierra Madre and we would just the Philippine soldiers would just move over.

And so so, you know, you begin with the fact that in order to do that, you would you would have to run the blockade and that would take some force or some speed or some stealth.

And so, you know, you begin with the fact that in order to do that, you would you would have to run the blockade and that would take some force or some speed or some speed or some speed or some speed or some耶

Yeah.

urgently over and above what the Philippines has done so far.

Yeah.

Alright.

I mean, I.

Go ahead.

Now, go ahead.

No, I mean, I think that I believe very firmly that the Philippines is looking into other ways to resupply the ship so that they don't become such tests of will every single time.

Right.

Right.

And you know, I think that some of those will probably come into into view in the coming months.

And you know, I think that some of those will probably come into into view in the coming months.

Right.

Right.

Yeah.

Yeah.

Yeah.

Right.

All right. Ray, Atty. Harry Roque, the former spokesperson of former President Duterte, has said this administration is practicing what he calls microphone diplomacy.

And he says it's not working.

I want to ask you this. Yes, this president has been firm and is quite admired by the West because of his West Philippine Sea stand on the arbitral ruling.

But the question is, does it actually work in de-escalating China's actions? Is this the right strategy? Or are we already falling behind the diplomatic route?

So I think, you know, the question is, what is the Philippines' desired outcome?

Obviously, you know, de-escalation is certainly something that's desirable always.

But when we understand that...

One of China's strategies is to get their adversary to de-escalate first so that China's adversary concedes, right?

They want to force concession.

So de-escalation, if it means, you know, conceding, is not necessarily always the best strategy, especially when you know that's exactly what China is wanting.

That's what they're actually trying to do.

So, you know, what the Marcos...

What this administration has done has been to accept some risk in order to try to gain some rewards.

And some of those have already happened.

And, you know, we can see that in just this recent trilateral summit in Washington, D.C., in which it walked away with some substantial rewards from both Washington and Tokyo.

And, you know, I mean, both on the security side and on the economic side.

So, you know, some of this international support...

It has taken real material form.

So, obviously, everybody would like to see de-escalation.

What we'd like to really see is to see a mutual de-escalation, not simply a capitulation.

Is a code of conduct still possible at this point?

I think I've probably told you this before, Karen, but I really am a skeptic about the code of conduct.

I just think that China's expansionist agenda is so far...

So far out of line with what not just the Philippines, but every other claimant country needs and wants.

I think that really the code of conduct has become a little bit of theater.

It's a place for China to sort of sideline more serious discussions, saying that we'll talk about it in the code of conduct negotiations.

But the code of conduct negotiations are never really intended to get to a conclusion.

Yeah. Ray, what can the Philippines do better in comparison?

With its ASEAN neighbors.

I've had interviews where former Senior Associate Justice Carpio, for example, has advocated exploration.

He says that's when President Marcos Jr. will walk the talk.

Because it's such a proactive approach, right?

To saying this is ours, this is the exclusive economic zone.

And he says Malaysia has already started exploration without asking permission from China.

In a national security point of view, how should and how would it benefit the Philippines to approach exploration,

considering we do have our own power issues in the Philippines?

And I mean energy.

Yes. So understanding that the Philippines' energy issues are acute.

In other words, you're concerned about running out of gas from the Malampaya fields very soon.

And starting exploration now is not a short-term.

It takes quite a while for all of that to result in the discovery, in the drilling, in all of the exploitation.

All of those things take a very long time.

So, you know, you're looking at a long-term solution, which doesn't mean you shouldn't do it.

But it means that it's not a solution for where the Philippines is now.

And the Philippines will have to look at other things in addition to exploration.

I think that it's, you know, go ahead.

Go ahead, Ray.

No, I think it's, I mean, I think that the Philippines should certainly,

look at whether it wants to go ahead and try exploration.

The hard thing that the Philippines has to deal with is that because it has not yet explored and drilled within the Nine-Dash Line,

it makes it in some ways harder to start.

Whereas, you know, Malaysia and Vietnam already do have active wells within the Nine-Dash Line.

So doing additional exploration doesn't seem like such a big deal.

Whereas, you know, for the Philippines to go out,

sort of for the first time, makes it look like a bigger deal.

That is interesting.

So, Ray, in effect, if it had been done before, it would be less of an issue today.

Sure.

Doing more exploration and drilling is easier than doing, you know, initial exploration and drilling.

Because all of a sudden, it's like you're crossing some big line instead of just continuing to do what you have done.

Hmm.

Recommendation, this is from former Solicitor General Francis Ardeleza.

Justice Ardeleza said that perhaps what this administration can consider is bringing China back to court, you know,

for environmental damages.

Do you think at this point where we are, Ray, that would make a difference?

It would certainly build, you know, more of an international consensus.

I think that you are likely to find that there have been environmental...

environmental damages, in particular, actually, the destructive giant clam harvesting at some of the places like Scarborough Shoal and others.

Now, the difficulty is because you don't have access to some of those places, especially Scarborough Shoal,

actually proving environmental damage becomes very difficult, right?

Because you need China's participation.

You need their acquiescence in order to get the right investigators there to demonstrate the damage.

Right.

Everybody believes there is great damage, and there are ways to show, and the AMTI, the Asian Maritime Transparency Initiative,

recently released a report called Deep Blue Scars that showed some of the damage you can see from space to Scarborough Shoal.

But ultimately, you'd want to be able to get actual scientists, you know, on the Shoal to be able to demonstrate or to prove the damage,

and that, obviously, would be very hard.

Because China would not comply.

They would not play along.

But what can countries do?

Specifically, for example, with Scarborough Shoal, the arbitral ruling, UNCLOS has said that that's a common fishing ground.

China, the Philippines, and Vietnam.

And yet, we know that within the Shoal, it's only Chinese vessels that are in the Shoal.

Our fishermen have said they can't enter the Shoal.

At one point during Duterte's time, they were at the...

They were in the mouth of the Shoal.

Now, they can't fish in the Shoal or outside the Shoal.

But what can be done to reinforce that particular decision?

So, either China needs to feel pressured to change its ways,

or it needs to see somehow that it's in its national interest to become more agreeable, right?

So, you know, the pressure can come in a lot of different ways.

It can come through arbitration and going to court.

It can come through...

Say, going to the UN General Assembly.

But that's a high-risk strategy because China has a lot of influence over other countries.

And the Philippines could actually lose the vote.

So, you know, and then where would the Philippines be?

So, the other thing that, you know, we actually have had some conversations here about is,

what if you could sort of convince China to turn Scarborough Shoal into a marine protected area or a peace park?

Yes.

In which case, you know, both countries agree that...

to set aside the sovereignty concerns in order to preserve the environment and to preserve the Shoal

and to allow the artisanal fishing, the traditional fishing that has taken place for a long time.

Could you convince China that that is actually in the national interest

and it removes one of those huge rub points that makes them look so bad on the international stage

and actually do some good?

Because at the end of the day, Scarborough Shoal,

it's all about food.

It's a very rich fishing ground, correct?

Correct.

Unfortunately, on the Chinese side, it's also very rich in these giant clam shells.

And understanding the value of the giant clams is in the shell, not in the meat.

So, because it's in the shell, they turn those shells into jewelry and other kinds of things that are valuable in China.

And other places.

And you can get at those when you essentially destroy the reef and then pull out the shells.

And so, you know, destroying the reef, of course, is what we don't want.

But that's precisely what the giant clam harvesters have to do in order to get what they want.

So, they're not supposed to be doing it.

China is not supposed to be allowing it.

But we very strongly suspect that that's precisely what's happening there.

Okay.

And coming from a national security perspective,

I don't know if you've heard of some of the concerns of lawmakers in the Philippines on supposed.

There are thousands of Chinese nationals or Chinese students in Tuguegarao, in Cagayan.

And lawmakers were concerned because there were two EDCA sites in Cagayan, right?

Talks of Chinese nationals posing as Filipinos.

And now sources have said,

Chinese nationals obtaining birth certificates, Filipino birth certificates in Mindanao.

So, there are all these stories coming out that's actually breeding xenophobia.

Yes.

And that's what I wanted to ask you, Ray.

As a national security expert, is this a cause for alarm?

Yeah, go ahead.

I would certainly say it's a cause for concern.

I think you always have to be careful about alarm when it comes to these kinds of things.

Because it can easily cause people to go into some scary things that you don't want people to do, right?

You don't want people to be tempted into racially motivated violence.

There are lots and lots of people of Chinese origin who are great people, even Philippine patriots.

You don't want to sort of get all of that confused.

You have Filipinos who have Chinese heritage.

You don't want them singled out or in any way persecuted simply because of their ethnicity.

So, what you want is you want for a responsible government investigation

in order to find out if some of these people actually are agents of China or doing the bidding of Beijing.

That's a far different thing than singling people out simply because they have Chinese ethnicity.

Yeah.

So, you're saying the Philippines should do its job and actually investigate?

Absolutely, right.

And also, you know, to sort of communicate to the Philippine people that, you know,

it's the value of the Philippines to treat people with respect until you know that they've done something that is wrong.

All right.

My last question, Ray.

You've talked about China's expansionism, right?

And the bigger question is what else can they do?

They believe in the freedom of navigation.

They've said that many times.

They've already occupied Mischief Reef.

If this goes, if they're undeterred, what else can happen to the exclusive economic zone?

Well, I mean, so we've already seen signs of this, right?

Because even though they say they believe in the expansionism,

and the freedom of navigation,

what they have done consistently is to deny the freedom of navigation to the Philippines.

You know, when they intercept the Philippine Coast Guard and the resupply boat at Sabina Shoal

and begin to block it halfway between Sabina Shoal and Ayungan Shoal,

that is denying the freedom of navigation.

You know, so that is denying the legitimate right of the Philippines to traverse.

It's not just because it's in the Philippines' exclusive economic zone, which it is.

It's not just that they're doing a legitimate thing, which it is.

They are on the high seas legally.

And denying the freedom of navigation on the high seas is against UNCLOS.

It's the UN Conventional Law of the Sea.

Denying the Philippines' access to the artisanal fishing ground at Scarborough, Seoul

was explicitly called out in the arbitral award.

And China does not care.

So what are we concerned of in the future?

Well, I would certainly be concerned were China to take additional steps

to consolidate their position at Scarborough, Seoul, for example,

such as building a structure.

That would be very alarming.

That would certainly be a cause for great concern in Manila and Washington

because that would be a major step toward not only denying the freedom of navigation,

but it would be...

Absolutely.

Having an outpost there would be a very significant security threat.

That's very interesting, Ray.

And would you say that these drills, patrols from other nations,

this actually helps prevent them building in Scarborough, Seoul?

I think what it does is it sends China a message that the Philippines is not alone

and that continuing to up the ante like this is not just making rug points with the Philippines,

not even just with the United States,

but now they have to think about Tokyo.

Now they have to think about Europe.

Now they have to think about Australia.

So they have to think about how isolated do they want to become

because that's what they're inviting upon themselves.

Yeah.

Good one.

So what you're saying is President Marcos Jr.'s foreign diplomacy

when it comes to the West Philippine Sea,

this particular strategy is giving China more countries to worry about.

It is complicating their strategic calculus

and it is resulting in some...

actual material benefit for the Philippines

because some of these countries are making commitments now to the Philippines

that they probably would not have made

had all of this not been kind of put in front of their face

by the Marcos administration and their assertive transparency campaign.

On this note, I want to thank you for joining me today,

former US senior defense official and security analyst, Ray Powell.

Thank you, sir.

It is always a pleasure, Karen.

Same here.

We're going to take a quick break and start.

We'll be right back.

We'll be right back.

Mobility will be key to recovery

because we have relaxed

some of our quarantine methods

and we have allowed more transportation to come out.

That's going to prove to be better for demand.

If we do follow the health protocols,

the ability of people to move around

will likely contribute better to growth.

But you have to know that

.

.

Thank you for watching!

Thank you for watching!

Thank you for watching!

Thank you for watching!

Thank you for watching!

Thank you for watching!

Thank you for watching!

For passing the burden of reducing power demand to the public.

And we're now joined by National Grid Corporation of the Philippines, or NGCP Assistant Vice President and the head of the Public Relations, Attorney Cynthia Alabanza.

Attorney Alabanza, good morning to you.

Good morning, Karen. Good morning, everyone tuning in.

All right. For our viewers this morning, let's get into an over...

Let's now get into an overview.

The NGCP has issued a series of red and yellow alerts over Luzon and Visayas.

And I hope you can explain this in simple terms.

What does that mean for the public and why?

Well, you know, we've been issuing grid status alerts over the Visayas and Luzon for the past couple of years now, maybe three, four, five years consecutively.

Although there is no persistence.

You do feel it during the summer or shortly after summer.

And that's indicative that, you know, although for the general portions of the year, there is enough power supply.

It's indicative that your excess is thinning because then you're vulnerable to heat, you're vulnerable to unplanned maintenance and shutdowns.

So I think maybe it's really an indication that we have to go back to the drawing board.

In terms of ensuring that we have a more resilient power system.

Okay. So simplified tayo, Atty. Alabanza, because our viewers, you know, they're homemakers, they're business people who are running companies with homes and some homes too, right?

So nothing too technical.

But the bigger question is this.

Are we using more power today because of the heat?

It's so hot.

We're eating 45, 46.

Are we using more power?

Yes.

We are.

And unfortunately, the reason we're seeing red alerts is that the entry of new investments in the supply sector is being outpaced by the growth in how much we use power.

So that's why there have been good alerts over the past several years.

Okay.

Number two, how many power plants are working or supplying at full at their full capacity?

That, I don't have the numbers, but what I was really focusing on is the amount of power that is made unavailable to the grid.

So just to explain, there are several reasons why power cannot be pushed into the grid.

On the supply side, it's because either they're on scheduled maintenance shutdown.

It's like a car.

When you go and bring them every 5,000 kilometers or every six months, depending on how you prefer to maintain your car.

Or it could be.

It could be on unplanned maintenance shutdown.

Like if you're driving a car, and all of a sudden, you know, it stops in the middle of the road.

So then it's out of commission.

Or it's called derated or running on a limited capacity.

So if it's able to make, let's say, 1,000 megawatts.

But for some reason or another, it's limited to maybe half of that, like 500 megawatts.

So if you total all of this, in the past week, it was enough to wipe out all excess and even the ancillary services of NGCP.

It's contracted.

It was wiped out.

So there wasn't really enough to meet the demand of the system.

Okay.

The Energy Regulatory Commission has said that they will be starting an investigation into the red and yellow alert declarations.

And in the statement, they said that a generation company submitted the power situation in which, in Luzon, for example, several outages April 16, right?

Right.

A total of 3,233 megawatts was out of the system April 16, April 18, another more than 1,000.

And I think that's a total of 2,000 still on outage.

An investigation also into the Visayas.

Why is this happening?

Can the NGCP help this or this is completely on the generation side?

You know, it's a system.

So you have the generation, the distribution, and the power transmission which links the both of them.

So I've always said this.

We've had several conversations on this.

All three of us have to face our development together and think.

And on the transmission side, you know, we've been struggling with our projects.

So a lot of our, the three major projects, I think that the last time we spoke about, really happy to announce with a sigh of relief that all three projects have been energized.

There's a third project here in Luzon.

Can you enumerate it again?

Yes.

It's been energized, what we've discussed.

We energized the backbone in Luzon, the Hermosa San Jose, 500 kilovolt backbone.

That's the largest kind of transmission line we have in the Philippines.

And that was energized last May.

But it was energized partially only because then we got hit with a temporary restraining order.

But the temporary restraining order, I think last week, late last week, was fortunately lifted.

Yeah.

So we're now, you know.

I don't know how TROs can help all of us at this point.

It doesn't.

It doesn't.

So thankfully, you know, very thankful.

The Supreme Court lifted that.

But not after we suffered, I think, 10 months of delay, more or less.

So we just started doing the remaining circuit, I think, yesterday or two days ago.

So, you know, we're struggling to make sure that that's finished.

But the energization last year.

Ensured that all power plants connected to the system were already being dispatched.

Meaning there was no, all power plants making power could now be transmitted to the different areas that it's needed.

We also energized last January the Mindanao-Vizayas interconnection.

In fact, we're very grateful that the president, President Marcos, did the ceremonial energization in Malacanang.

Yeah.

And more recently, in Bacolod on April 8th, the president also graced the inauguration of the Cebu-Negros-Panay interconnection.

So these were the biggest projects that, you know, we've been criticized for delaying.

And I'm very happy to announce that all of these are now currently energized.

So on the transmission side, you know, we've had our struggles.

But the major projects have been energized already.

On the supply side.

We really have to.

But nothing is down with transmission today?

Today, no.

Okay.

Today, no.

Today, no.

The thing is, you know, I also listen to other, to the Department of Energy and representatives from the generation.

And a common thing that I've heard over the past several years is that apart from the fact that demand or usage has outpaced the entry of new supply,

you're also seeing aging plants.

Yeah.

And also, we have to.

And also, we have to ensure that the generation mix or the types of fuel that we use for our generators remain balanced.

We can't put all our eggs in one basket.

Example, it's an El Nino year.

So a lot of our hydro facilities will understandably be operating at reduced level.

And we also can't put all our eggs on the solar and wind basket because those are variable.

So it means if there's cloud cover, or if the wind stops, then you don't have power.

So we have to have a really good mix of all these kinds of fuels to ensure that, you know, we're not vulnerable to any movement in the weather.

And just recently, the Department of Energy has endorsed 11 power projects, right, to the NGCP for a system impact study.

Let's talk about that particular timeline.

First of all, the 11 power projects.

Okay.

So the 11 power projects, which are all renewable, is that correct, right?

Yeah.

Yeah.

Because there is a ban at this point from President Marcos Jr. that started from former President Duterte to actually put up coal plants.

Tama?

I heard about that, but I'm not sure if it's still in place.

But yes, there was a ban on coal.

Okay.

So these 11 power projects, can you talk about this?

Will this be addressed?

Yes.

Okay.

So there's a dramatic change in the system.

There's a wind project.

I'm reading it here right now.

There's a solar project as well, a few solars and wind, right?

I mean, there's partly Cebu Corporation, Desaius Energy.

So I'm not sure where the focus of these projects are.

There's also San Roque Hydropower, right?

There are 11 of them.

Okay.

What big a difference will this make?

Well, you know, it really depends.

Again, it's still in the system impact study stage.

But the good thing is that the transmission system, because of the three major projects and other developments that we've put in in the past couple of years,

it's able to now accommodate more power.

For example, the Hermosa San Jose backbone in Luzon.

Okay.

They said for an additional 8,000 megawatts in capacity for Luzon.

Of what?

Ano to?

Renewable?

Renewable?

Any.

You know, when it goes into the power system, you don't distinguish.

In fact, NGCC cannot distinguish either.

We have our mandates to connect, and we don't prefer one kind of fuel over the other.

So as long as there's power, they can connect to us.

Okay.

So there are additional capacities available from the new projects that we've energized.

However, it really all depends, again, on where these plants are going to be put up.

Because, you know, even though we have additional capacities that we can accommodate with the new projects,

if they're going to build in an area where there are no transmission lines, then, you know, we literally, NGCC has to start from scratch.

So this is where, you know...

You know, every time, I think you've heard me say this several times, multiple times over the past years,

that's where the holistic planning comes in.

Yeah.

So you have to look at energy type, you have to look at the location, you have to look at the reliability,

and all that comes into play so that, you know, we won't be feeling these glitches.

Okay.

I'm curious, attorney, with the 11 power projects recently endorsed by DOE asking the NGCP for a system impact study,

what is the timeline of such a...

So we understand, yeah, I mean, the plans are there, but the study in itself, how long does that take?

Again, I think that's one of the things we've been criticized for before, that we had a huge backlog.

And, you know, we've been in discussion with the Department of Energy on how this can be streamlined.

Because we did also see a dip in conversion, meaning, like, in 10, 15 years ago,

around 75% of all the power projects were in conversion.

So, you know, we were talking about ways on how to filter the people who are really serious.

And, of course, on our side, you know, that's not an excuse.

We really had to bolster our system and ensure that what was pending was, you know, could be churned out quickly.

In order to allow these investors to really consider whether they're coming in or not.

And I'm, again, happy to announce that we no longer have a backlog.

So we're keeping within the time.

So it's no longer like several months, no?

We're keeping to within the timeline that are set by the Department of Energy for churning out this system impact study.

Okay.

As regards, I think the longer part of the waiting time for new power plants would be actually the building, you know,

when they're at the...

Indicative stage or they just indicate their interest in coming in.

You know, that's just the first step.

But I've heard so many people from the generation side also say that the gestation period of a power plant is anywhere between five to seven years.

Exactly.

Oh, yeah.

Have we improved?

Have we improved?

I mean, there were talks that in Singapore, it takes three days.

You have all the signatures.

They've made a decision and you build.

I wish.

That's where the case right now.

But even with NGCP, you know, I can't, I won't speculate on how hard it is to build a power plant because I have no knowledge of that.

But even for NGCP, you know, it's around half, more or less, of our timeline for a project will actually be for right-of-way and permits.

Yes.

I also handle, Karen, local government relations.

I'm very familiar with the difficulty in getting permits.

And again, I always thank...

...for really helping us communicate with the different LGs and, you know, let them know the criticality of our projects.

And he has helped so much, especially with the three projects I mentioned earlier in getting the permits done.

And of course, right-of-way.

You know, it's so difficult to negotiate because everyone wants the best price and everyone wants us to move to every corner.

But, you know, at the end of the day, this is for the greater good.

And it's difficult to explain.

It's difficult to explain to them why we have to take their properties because, of course, they're looking at it as a personal issue.

But we're looking at it from a national issue.

So, that's kind of difficult to balance.

All right.

I think before we end the interview, so just two questions.

Senator Risa Onteveros has already slammed the Department of Energy for asking the consumers to make the adjustment instead of the Department of Energy answering the energy needs.

But offhand...

If we were to address consumers right now, number one is how could consumers help?

I think there's not much we can do when it comes to supply.

But what can we do as consumers to make life more bearable, to make energy prices or our power billing not as high as it has become because of the heat?

What can we do quickly?

You know, you hit the nail on the head.

Right now, there's no way we can put in more supply at this late time.

So, it's really demand-side management.

And while I agree with Senator Onteveros that, you know, the public shouldn't be made to bear the consequences of things like this, we really have no choice.

So, you can't tell people not to use electricity, but you can tell them how to use it judiciously.

So, you know, literally, you go back to 20 years ago when our parents told us to turn off unnecessary lights, to unplug appliances that we don't use because that has phantom loads.

To make sure that we do...

We do our household chores during the weekend, you know, when we're not competing with commercial establishments.

You know, all these small things, you know, clean your bulbs, defrost your rifts, clean your electric fans, clean your filters.

These will, you know, come up with more judicious and more efficient use of whatever electricity we have.

So, you know, those are the only things we can do right now.

And of course, you know, the ILP program of Meralco and SM.

SM also is one of the biggest.

Those are things that are really good on the short term.

But I will echo what Secretary Petilia said in an earlier interview, that we have to start planning for the next administration.

Because what the next administration will be looking at in terms of supply is being planned right now.

And it goes back to the holistic approach to energy planning that we've long advocated.

And I hope this is something that people, the current administration, really focus on.

And I have confidence that they will.

Okay.

Before we go, I want to ask you this.

There's been talk.

Actually, it was Speaker Martin Romualdez who made a bold proposal for the Maharlika Investment Fund to actually invest in NGCP.

Has that been seriously talked about?

None that I know of.

None that I know of.

But of course, you know, NGCP, we are listed to our mother company, the SGP.

So that is something that I think can be discussed.

And investments are always welcome.

Okay.

So is NGCP looking for new investors?

Not actively.

But, you know, again, our stockholders, our Filipino stockholders, Henry C. Jr. and Robert P. Zunar, are more than capable of funding or finding funding for our projects.

But again, this is business.

You know, it will go down to what's most advantageous for everyone.

And of course, because we're a public.

We're a public.

We're a public.

We're a public.

What's most advantageous for the Filipino people?

On that note, I want to thank you for joining me today.

Attorney Cynthia Alabanza, thank you.

Thank you, Karen.

And good morning.

All right.

That's a good start today, everybody.

So I think with the heat, it's time, as she said, to judiciously consume and use energy.

So think about that, too.

There's not much we can do.

Thank you for watching.

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