Power Distribution Digitalization

Power DUs pivotal in shaping smart cities

November 21, 2023

Aboitiz Power Corporation (AboitizPower) Distribution Group Chief Operating Officer Anton Perdices underscored the importance of distribution utilities (DUs) in the development of smart cities in the Philippines, citing it as the backbone of the electric power industry that can help propel urban areas to be technologically enabled.

“What does the future hold for our cities? It’s all about energy democratization [and] electrification of the economy, with the expected influx of electric vehicles, digitalization through smart meters, net metering, digital substations, and smarter city grids,” he said during BusinessWorld’s business forum entitled A Blueprint for Philippine Smart Cities held in Cebu City.

“To make these aspirations a reality, a well-planned transition in the city’s energy system is essential. This transition demands cross-border collaboration and learning from successful cities that have walked this path before,” he added.

Mr. Perdices cited the experiences of AboitizPower subsidiary Visayan Electric Company, Inc. (Visayan Electric), the country’s second largest DU, in trying to usher a smarter future. Its franchise area includes the cities of Cebu, Mandaue, Talisay, Naga, and parts of Metro Cebu, the country’s second largest urban center.

“In our pursuit of a smarter future, we’ve introduced MobileAP, an app that streamlines bill payments and empowers customers by providing a clear view of their energy consumption history,” he said, emphasizing the need to make transactions more convenient for customers.

“Our initiatives range from implementing smart metering for more accurate measurements to utilizing distributed energy resources such as rooftop solar and battery energy storage,” he added.

Rooftop solar and battery energy storage are used in net metering, or the exporting of excess generated electricity to DUs, allowing the consumer to offset consumption and reduce electricity costs.

Mr. Perdices also mentioned that Visayan Electric — along with its counterpart in Davao City, Davao Light and Power Company — have kickstarted AboitizPower’s transformation of its fleet of four-wheel vehicles and motorcycles to 100% electric by 2040. This is in support of the Electric Vehicle Industry Development Act or EVIDA and its vision of cleaner mobility in the Philippines.

“This illustrates that cities are not only centers of culture, education, and economic activity, but also centers for energy. In fact, cities account for as much as 80% of all global energy consumption,” Mr. Perdices said, mentioning how the province of Cebu alone already accounts for half of electricity demand in the Visayas grid.

“This underscores the critical importance of energy security in maintaining residents’ quality of life and attracting investments – both key elements in fostering smart city growth.”

Electricity sales in the Visayas grid are expected to have an annual average growth rate of 7% from 2020 to 2040, according to the Energy department.

But given the enormity and scale of the power industry, Mr. Perdices stressed how relevant stakeholders — from generation, transmission, distribution, to end users, and spanning the private, public, and civil society sectors — must foster collaboration and meaningful partnerships in developing technologies and building the necessary infrastructure.

“This responsibility doesn’t rest solely on one entity. It’s a shared endeavor involving cooperation between service partners, including utility companies and local government suppliers. Together, we can optimize energy consumption, enhance grid stability, increase resilience, and empower consumers to make more informed choices,” he said.

This article first appeared in BusinessWorld's Spotlight section on November 20, 2023.