Anything is feasible if you use your imagination
The Manila Times
BEFORE I move on to the intended topic for today, a brief update on the resolution of a ridiculous scandal from last week (“An unnecessary controversy at LWUA,” November 14) is in order. To recall, the controversy involved the politically motivated attempt to remove the chairman and two board members of the Metro Cebu Water District (MCWD) by Cebu City Mayor Michael Rama, who, when unsuccessful in achieving this, sought the cooperation of Local Water Utilities Administration (LWUA) board chairman Ronnie Ong, who hastily arranged for a board resolution ousting Rama’s target at the end of September. This move was resisted by LWUA administrator Vicente Homer Revil on legal grounds, as neither local government officials nor LWUA has the power to remove officials of water districts, except in cases where a water district is irreparably delinquent in making its loan repayments to LWUA, or if there is a valid order from the Civil Service Commission or Office of the Ombudsman for reasons of some serious criminal or administrative violation. For his trouble, administrator Revil earned himself some unfair and irresponsible accusations of corruption from a few pundits who could have avoided making fools of themselves by spending half an hour or so checking the relevant laws and regulations, which clearly confirm Revil was right, and chairman Ong and Mayor Rama were way off-base on this one. Although the apology we should be hearing from Rama and Ong for their attempt to trample on legal regularity and wasting everyone’s time has yet to be offered, the MCWD itself considers the matter closed. In an undated statement (it was handed to me last Thursday), the MCWD board said that following a meeting with members of all its employees’ associations — managers, supervisors, the employees’ union and association of non-regular employees — it was unanimously decided that MCWD would maintain the status quo of its current board and its members’ terms of appointment. “The decisive ruling from LWUA which states that local executives have no authority to remove the chairperson and members of the board of directors of a water district brings much-needed clarity, putting an end to the confusion that has recently plagued the water district,” the statement said. “MCWD is committed to adhering to the guidelines set forth by this regulatory authority, ensuring the smooth and effective operation of our services.” As I noted in my previous column on the subject, “the smooth and effective operation” of MCWD’s services is still a legitimate matter of concern, a problem brought on by Metro Cebu’s unchecked growth. However, in my conversation with LWUA last week, I learned that there are some rather profound solutions already in the works with the cooperation of several government departments, not just for the Cebu area but other parts of the country as well. When some substantial information about that becomes available — I understand that may be sometime this week — it will certainly be worth talking about. *** So, that’s some good news, but here is some that is not so encouraging: On Monday, October 9, Trade and Industry Secretary Alfredo Pascual reported to the media that two Australian firms, Southern Infrastructure Pty Ltd. and Kaizen ANZ Pty Ltd., have proposed building a 40-megawatt (MW), thorium-fueled nuclear power facility called an STGR20 in the Philippines. Pascual met with executives of the two companies ahead of the 6th Philippines-Australia Ministerial Meeting in Adelaide on October 10. This is exactly what the Department of Trade and Industry (DTI) said, as reported at the time by the Philippine News Agency: “In the meeting, they discussed a potential project in developing, building and operating an initial 40-MW thorium-fueled simple, high-temperature gas-cooled reactor STGR20 to deliver a safe, sustainable and green base load energy at the lowest kWh (kilowatt-hour) rate in the market at USD0.038 per kWh,” DTI told reporters in a Viber message. “The project will start by mid-2024 and finish construction by 2027, and is expected to generate at least 1,000 local jobs during its construction and operation,” the DTI added.” That information raised a number of red flags, because when something sounds too good to be true, it almost always is. After several weeks of investigation — which was slowed by frustratingly indirect answers to relatively simple questions by the Australian proponent, and a palpable reluctance to provide any answers at all on the part of the DTI — it turns out that no such device exists, and that the letter of intent from the Australian firm to provide a feasibility study is, at best, pointless window-dressing whose only purpose is to give the well-traveled Secretary Pascual one more line item on the list of “investments” he is supposedly bringing into the country. In order for there to be technical specifications presented to DTI — which, in an extensive email exchange I had with him, Southern Infrastructure’s Managing Director Paul Watson said he provided — especially specifications that allow an estimate of construction time and manpower needed, as well as a specific retail electricity cost estimate, there ideally must be a working prototype of the planned reactor, or at least a design advanced enough to be deployable for licensing, commercial sales and construction, which in that case would be duly recorded in the International Atomic Energy Agency database, because they’re big fans. That is not the case here. This is the answer of Mr. Watson to my specific question, “Who is actually designing the reactor, and is that design available for public viewing? Has it been provided to the DTI, DoE (Department of Energy), or other agencies here in the Philippines?” He wrote: “The technology is well proven and well-known, and most advanced countries in the world are currently working on various forms to suit their needs/requirements. We are currently working with the DoE/DTI to get traction on the transfer of knowledge to allow us to move forward with the project of delivering green, safe, affordable energy into the DoE supply matrix in the form of SMR that can be either landbased or barge-based thus giving flexibility of supply within the archipelago.” I should note that is the more fulsome of the two answers I received for the same question; I asked twice. The DTI gave a somewhat more detailed — but not by much — response to the same question. “The design/IP of the product comes from the Netherlands. Southern Infrastructure Pty Ltd. has the exclusive rights to market and develop this technology in the Philippines as well as other countries,” they wrote. “The manufacture of the reactor and associated plant and equipment will be constructed by a consortium of Tier 1 fabrication organizations from Spain, [the] UK (United Kingdom), Brazil, Belgium and China. It is too early in the process to divulge the exact corporate confidential details at this stage.” Here’s the thing about SMR developers’ business (and why all of them will likely ultimately fail): The SMR business model and path to any hope of profitability is based on volume; developing and building one reactor in secret is not going to keep any company afloat, so, if a developer has a design that is ready to be marketed, it is going to advertise that. And if it has an “exclusive marketer,” then that firm is going to advertise it. Look up any better-known SMR venture, such as NuScale, Ultra Safe Power Corp., X Energy LLC, or the Bill Gates-backed TerraPower, and you will see that they are not at all circumspect about displaying their wares, real or imagined. Try to find an “STGR20,” however, or “thorium-fueled simple, hightemperature gas-cooled reactor,” and you will not find anything that could even be remotely construed as what was described by the DTI’s triumphant announcement last month, in the Netherlands or anywhere else. Anything is feasible if you use your imagination, so a feasibility study that will inevitably conclude, “This could be built in the Philippines, if it actually existed” is an easy win for a skilled infrastructure consultant. All concerned engaged in tortuous avoidance language when presented with the direct question, “What is this costing the government?” So that may be a concern, but since it will be a one-time cost, maybe it will be worth the price for the lesson to not be so gullible when listening to fantastic sales pitches.