A short biography of the Energy Technology Selection Expert & Project Finance Modeling Expert

June 4th, 2017 Posted in energy expert

A short biography of the Energy Technology Selection Expert & Project Finance Modeling Expert

Engineer Marcial Ocampo has humble beginnings as an adopted 3-year old boy of a young aunt Tining Ramos married to a young Doctor Potenciano Tawatao educated in America and having just one girl teen daughter as the older sister died during the height of WW2.

Marcial is the 2nd son of WW2 veteran Jose Ocampo and Pacita Lopez Tawatao (a war orphan and adopted by the young aunt). We were 9 children in all (5 boys and 4 girls).

This young family of 4 went to Musuan, Bukidnon in the island of Mindanao to join the faculty of Musuan Agricultural College (now Central Mindanao University). Marcial obtained his elementary education and graduated as the Grade 6 Valedictorian. When the only daughter transferred to Manila to study Medicine at UST in Manila, the young Marcial and his adoptive mama followed also and continued his high school education at San Sebastian College in Manila and finished Year 4 Salutatorian.

Marcial went on to study at the premiere University of the Philippines in Diliman Quezon City and finished his B.S. and M.S. Chemical Engineering degrees and worked part-time as personal driver of a college professor and College of Engineering Instructor. He also took the Chemical Engineering Licensure Exam in August 1973 and passed as 2nd Placer with an 87.75% rating. He became a British Council scholar at the University of Leeds, UK, where he finished his M.S. Combustion & Energy and thesis in just one year.

In 1979, Marcial married Veronilyn Palacio, daughter of Engineer and Bureau of Mines Mindanao Regional Director Demetrio Palacio and Veronica Pecaoco. The fruit of their love are 4 boys and 1 girl (Mark, Eric, Patrick, Francis and Catherine) and have now 3 granddaughters (Riona, Chissa and Briana). The couple also have provided education to 4 relatives (Gilbert, Justine, Kim and Julius). The couple are also active members of the Couples for Christ and has served as household member, Unit Head, Kids for Christ coordinator, and presently a household member.

After a number of starting jobs, Marcial joined the Department of Energy as a PNOC-PETRON-hire seconded as Section Chief of the Transport, Buildings & Machinery Section under the Conservation Division of DOE and conducted various energy audits of major industries throughout the country. Later on, when the DOE was abolished and replaced by the Ministry of Energy (MOE), Marcial transferred to the Petron Bataan Refinery (PBR) as Computer Systems Group head and Linear Programming (LP) model custodian. He retired from PETRON and then went on to work for PETRONAS Energy Philippines Inc. (PEPI) as EDP & Budget Manager and Executive Director of 50+ staff PCIERD-DOST.

Marcial later joined First Gen Corporation as Senior Technical Services Manager where he was introduced to power plant modeling and simulation, and later, into project finance modeling to determine the feasibility of power plant projects and alternatives, and to value the privatization price of an asset of NPC for bidding to interested buyers.

Armed with his accumulated expertise and knowledge of world energy resources, reserves, extraction rate, years to deplete, power generation technologies and its description, theory, history, capital and operating costs, availability and reliability, construction period, economic life, efficiency or plant heat rate, cost of fuel and its heating value, environmental impacts, benefits and risks, and commerciality, Marcial then prepared a compendium of all power generation technologies (renewable, conventional, fossil, nuclear, energy storage) in power point presentation format and developed a template project finance model to calculate the first year tariff (or feed-in-tariff in the case of renewable energy), equity and project returns (IRR, NPV, PAYBACK), debt service cover ratio (DSCR), benefit-to-cost ratio (B/C), and other financial ratios to assess financial risks of the project during the planning stage of the project cycle. In addition to this deterministic (fixed) template, he prepared a version with stochastic (probabilistic) analysis using Monte Carlo Simulation (MCS).

The MCS model varied by +/- 10% the independent inputs in a random manner such as electricity tariff, availability factor, fuel heating value, debt ratio, plant capacity, all-in (overnight) capital cost, variable O&M cost, fixed O&M cost, cost of fuel, efficiency or plant heat rate and exchange rate. The MCS dependent output consists of a probabilistic distribution curve of equity and project returns (IRR, NPV, PAYBACK), net profit after tax, pre-tax WACC and electricity tariff (or feed-in-tariff for renewable energy). The shape of the distribution curve and relative position of the average value of the dependent variable is indicative of project risk.

He also prepared a manual on “How to Design a Mini-hydro Power Plant” and developed a model to “Optimize Penstock Diameter given its Thickness, Strength, Diameter, Capital and Operating Costs, Cost of Electricity and Friction Loses”.

Marcial is civic mined and patriotic, and helped the government thru the DOE in the “Crude Oil Price Hike to USD100 per barrel Impact Study in 2008” and the “Oil Price Review Study of 2012” where he developed the Oil Pump Price Calculation Excel Model to predict changes to pump price or absolute pump price given changes in FOB or MOPS import cost, ocean freight and insurance costs, exchange rate, gov’t excise taxes and port charges, brokerage and arrastre charges, VAT on importation activities, oil company margin, pumping and transshipment costs, hauling costs, dealer margin, and VAT on local activities. The pump price model can be downloaded from the DOE Website.

He also assisted a foreign consultant prepare a historical analysis of the short-run marginal cost (SRMC = variable O&M cost + fuel cost) and long-run marginal cost (LRMC = annualized capital cost + fixed O&M cost + regulatory cost + SRMC) for all power plants in the country in order to assist a client prepare his competitive bid offers in the Wholesale Electric Spot Market (WESM) as well as prepare their capacity expansion plans.

He also assisted the Philippine Congressional Committee on Dam Safety in improving the Dam Water Release Protocol by providing Dam Water Release Simulation Model to predict dam height (meters) and volumetric release rate (cubic meters per second) every hour of the simulation given the initial dam height and volume, power generation and water discharge, dam strapping table (volume vs. height), rainfall data (mm per hour) and area of the dam watershed and upstream drainage area with rainfall data or equivalent upstream dam release rate. This model answered the question: “How many hours and rate of pre-emptive discharge is necessary to increase a dam’s storage capacity in order to have sufficient space to absorb an incoming storm and thus avoid a catastrophic dam spill that will inundate downstream low land areas”.  The model accurately predicted the volumetric release rate at the height of the storm when the dam spilling level was breached. It also recommended how many days and rate of pre-emptive discharge is needed to avoid the dam spill during the height of Typhoon “Ondoy” and “Peping” that inundated the provinces of Pangasinan and Tarlac resulting in PhP 40 billion of damage and lost properties and lives.

He also assisted the economic team that studied the proposed excise tax increase in gasoline, diesel, kerosene, LPG, fuel oil, lubes & greases, and other petroleum products such as waxes & petrolatums to predict the price disturbance to be inputted into the input-output matrix of the Philippine economy to predict impact on GDP, inflation and employment.

Marcial continued to develop his overall skills in energy & power and became an International Consultant at UNDP and travelled to Jakarta, Beijing, Shanghai, New Delhi and Chennai working on wind diesel hybrid, 3rd generation fuel cell bus, biomass energy and India tea manufacturing.

Later, Marcial applied his energy & power expertise to join Sinclair Knight Mertz (SKM) as Senior Power Generation Engineer as part of the On-shore LNG Refrigerated Terminal and Re-gassing Facility project team at Limay, Bataan, a proposed project of Atlantic Gulf & Pacific Company (AG&P).

Marcial then joined the SMC GLOBAL POWER HOLDINGS CORPORATION as Energy & Power Consultant and finished a number of feasibility studies for an industrial park, coal-fired power plant using clean coal technology (CFB) and a coal mine project where he converted the coal-mine production plan into a project finance model to determine the cost of delivered coal to another SMC power plant in Mindanao. He provided in-house financial modeling expertise on solar PV, wind, mini-hydro, large hydro, natural gas-fired CCGT and coal-fired clean coal technology (CFB).

Marcial’s lifetime dream and advocacy is to help the country reduce its energy & power costs and consumption by optimizing the capacity and generation mix, reduce oil and energy imports by promoting indigenous resources, reduce the environmental impact footprint of power plants, and promote inclusive economic growth especially for the marginalized communities hosting the power plants and sources of fuels or energy.

Among the measures he proposes are as follows:

1) Use of advanced mixed integer linear programming (MILP) optimization software to process existing power plant data on capacity, efficiency or heat rate, availability and reliability, capital & operating costs, fuel costs & heating value, ramp-up and ramp-down rates and environmental emissions to optimize short-term and long-term capacity and generation mix, in order to achieve cheapest short-run generation cost (SRMC) and least cost long-run capacity expansion (LRMC).

2) Improve the quality of power generation (reliability, availability, frequency, load-following, backup reserves) in the country by having an optimal mix that balances the need for intermittent renewable energy for sustainable growth that also requires high-speed fossil generation to backup such intermittent technologies such as when the sun and wind becomes unavailable momentarily and stabilize the electrical network.

3) Make use of all municipal solid wastes (MSW), liquid and gaseous wastes (bio-gas and land-fill gas) to provide distributed power generation and process heat throughout the country in order to address waste collection, treatment, storage, sanitation and disposal problems.

4) Make use of all indigenous energy and fuel resources in the country in order to conserve precious foreign exchange (to purchase petroleum fuels, coal), utilize local coal and natural gas reserves, use carbon-neutral biomass from trees and shrubs to provide fuel pellets to co-fire boilers using oil and coal and thus initiate a gradual shift from fossil to renewable biomass power generation. I believe that anti-coal environmental advocates should take a second and favorable look into indigenous coal since later on, as the world runs out of fossil fuel, the country needs them for power and fuel security. Coal is a transition fuel as the world converts from oil products to renewable energy and delays the depletion of crude oil. It would be a crime in the future to burn oil products as fuel since scarce oil is more needed for lubrication of industrial and transport machineries and manufacture of pharmaceuticals and other chemicals.

5) Make use of available renewable energy such as biomass, waste-to-energy, solar PV, solar CSP, wind, mini-hydro and ocean energy provided by waves, thermal gradients, ocean currents and tidal flows due to the gravitational effects of the moon and sun on the earth’s surface that give rise to ocean currents or tidal currents in the vast oceans of the world. Estimates of 1.0 – 2.5 meters per second of ocean and tidal currents are found in the coastal vicinities of Japan, Taiwan, Vietnam and Philippines. Ocean currents are predictable and nearly constant as against intermittent solar and wind.

6) To utilize off-peak renewable energy to store energy in elevated dams or barriers, for future release using water turbines when peak energy and power is required. Energy may be stored as potential energy or as chemical energy in the form of Hydrogen gas from electrolysis of water using off-peak electricity and extracted in thermal plants or in fuel cells.

7) Let us integrate renewable energy in the design of our civil and transport infrastructures like putting solar PV and small-scale wind turbines in long-span bridges and dams, or putting ocean and tidal current water turbines under bridges or barrages that connects islands between straits, or when lakes or large marsh lands are surrounded with elevated highways that serves as flood control structures and provided with low-head water turbines to capture the energy of the released flood waters, just like in conventional large impoundment dams. This is one way of reducing the cost of the renewable energy by integrating them in the design and construction of public infrastructures. Building Integrated Photo Voltaic (BIPV) solar panels and rooftop-mounted solar heaters are now used in commercial buildings like malls, hotels and residential buildings to provide electricity and hot water.

8) Lastly, to reduce power costs drastically, adopt mine-mouth clean coal power generation technology (e.g. CFB). By using the low-BTU lignite coal reserves spread throughout the Philippine archipelago, which is economical only to use in mine-mouth configuration due to its low BTU, high moisture, high ash content, but low in sulfur and the mine adjacent to nearby limestone deposits, we can bring down further the electricity cost from base-load coal-fired power plants as it saves on the cost of logistics – hauling coal and barging or shipping costs – which are significant cost items. By integrating mine-mouth coal power plant with co-firing with biomass wood pellets coming from mature rubber trees and other fast-growing trees, the country can provide cheaper power without harming the environment and provide local job opportunities to coal miners and workers of tree plantations near the mine-mouth coal power plant. Planting rubber trees provide an immediate income stream to support the rural tree farm workers during the early life of the tree and once it become old and un-productive, it can be sold as wood pellets to the mine-mouth coal-fired power plant. Once the coal reserves are depleted or uneconomical to extract, the power plant becomes a renewable biomass wood chips and pellet power plant.

It you feel that my ideas are worth pursuing, I am available for new endeavors this coming August 1, 2017.

I am hoping you would find time to communicate with me and discuss my ideas further.

Yours truly,

Marcial Ocampo

+63-9156067949 (GLOBE mobile)

+63-2-9313713 (PLDT home landline) (email) (email)


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