Wednesday, November 30, 2011

EDC, AboitizPower eyeing Mindanao electric co-ops

Business Mirror
POWER generators Energy Development Corp. (EDC) and AboitizPower Corp. are keen on bidding to provide baseload power needs of 21 electric cooperatives in Mindanao. 

“We have some supply that we need plan to contract,” Richard Tantoco, EDC President and Chief Operating Officer, said. He added that EDC has just signed a supply agreement with Central Negros Electric Cooperative and that they are in talks with several other customers.

The Association of Mindanao Rural Electric Power Cooperatives Power Supply Aggregation Group Corp. (AMRECOPSAG) recently invited investors to supply 300-megawatts (MW) to 21 electric cooperatives in Mindanao.

“We might bid, although we have not reviewed the terms yet,” Luis Miguel Aboitiz, AboitizPower Executive Vice President, told reporters. 

He said they have yet to determine how many megawatts they plan to provide because they have not seen the terms of reference.

AMRECOPSAG said interested parties must submit a letter of interest not later than December 19 and should have the technical capability for the past five years.

Duterte to ‘veto’ Aboitiz land reclassification

By Jereco O. Paloma
Wednesday, November 30, 2011

DAVAO City Mayor Sara Duterte said she is open to the possibility of vetoing an ordinance reclassifying a parcel of land in Binugao, Davao City, where the proposed 300 megawatts (MW) coal-fired plant of AboitizPower is set to be established.

But she was quick to add that this will only happen if she sees compelling reason that would prompt her to do such.

Plan your Sinulog week ahead and find out what's in store for Sinulog 2012.

"We are still waiting for the official copy to be transmitted then we will study the ordinance," Duterte told Sun.Star Davao in a text message.

Duterte issued such statement following clamor of some environmental groups opposing the establishment of the multi-million Therma South Energy Project of the AboitizPower Corp.

Earlier this month, the city's legislative department passed on third and final reading the ordinance that will reclassify the 26-hectare land area in Barangay Binugao in Toril District from "Protected Medium Industrial" and "Protected Open Space Easement" to "Protected Heavy Industrial".

In a statement, No to Coal-Davao convenor Dr. Jean Lindo said their position is based on the "people's right to health, clean air and water and water and environmental sustainability."

"It also runs counter to the aspirations of the people of Davao for alternative sources of energy that are renewable and environment-friendly and the demand to keep Davao City free from pollutants and other harmful substances that the coal-fired power plant will bring," Lindo said in the letter addressed to Duterte.

Lindo said the Council's approval of project proposal of AboitizPower is in contrary to the city's policies which aim to protect its residents' health and environmental sustainability.

Lindo specifically cited the city's Solid Waste Management Ordinance, Watershed Code, resolution that created the Davao City Task Force on Climate Change, among others, which clearly oppose such practices.

Published in the Sun.Star Davao newspaper on November 30, 2011.

EDC set to acquire geothermal projects in Chile, Peru

Published : Wednesday, November 30, 2011 00:00 Written by : Euan Paulo C. Añonuevo

Energy Development Corp. (EDC) has signed a deal with an Australian firm to develop geothermal projects in Chile and Peru.
Richard Tantoco, EDC president, said the company signed a heads of terms agreement for the acquisition of 70-percent equity in Hot Rock Ltd.’s four geothermal projects in the South American countries.

“We are excited with the prospect of developing with Hot Rock Ltd. what we consider as some of the best geothermal concessions in both Chile and Peru. The ability to grow our business with full control over our steam fuel supply is the strategic rationale for the Lopez Group’s acquisition of the controlling stake in EDC,” Tantoco said.

The HOTA sets the framework and main commercial principles for EDC’s acquisition of a 70-percent interest in the Calerias and Longavi geothermal projects in Chile, where the company has a representative office, as well as the Quellaapatcheta and Chocopata geothermal projects in Peru.

Completion of the proposed transaction would depend on the satisfaction of certain conditions, including fully termed documentation, confirmatory due diligence and necessary regulatory and governmental approvals.

Hot Rock has completed most of the surface exploration activities at the projects. Within the next six months, EDC and Hot Rock intend to finish the remaining surface exploration activities.

According to their agreement, EDC and Hot Rock will establish joint venture companies to hold each of the geothermal projects, with the Philippine firm owning a 70-percent interest and the Australian firm a 30-percent stake.

Hot Rock holds one of the largest geothermal acreage in Australia, while EDC is the world’s largest integrated producer of geothermal power and the acknowledged global leader in wet steam technology.

As part of its expansion program, EDC earlier submitted direct applications for 13 sites and bids for 5 sites in Chile. EDC is also looking at opportunities to develop geothermal projects in Indonesia, Kenya and Peru.

Thermal Plant Buyer's Bond Held

Manila Bulletin
November 30, 2011, 12:00am

MANILA, Philippines — The release of the balance of the performance bond of Malaysian firm Gagasan Steel Inc., buyer of the Manila thermal power facility; is being hobbled by the uncompleted clean-up process of toxic wastes at the decommissioned facility’s site.

Gagasan Steel, which is an affiliate of Gagasan Steel Sdn Berhad, acquired the idled Manila thermal facility for $2.5 million in 2008. Of the $1.2-million performance bond posted by the buyer, it was gathered that more than US$500,000 has already been released.

The Malaysian firm reportedly elevated its concern to Malacañang following the refusal of the Power Sector Assets and Liabilities Management Corporation (PSALM) to release its bond deposit because of the pending completion of the polychlorinated biphenyls (PCB) wastes clean up. PCBs are widely used as dielectric and coolant fluids in transformers, capacitors and electric motors and are considered to be environmentally damaging if not properly disposed.

“Gagasan still has pending obligation to dispose PCB transformers pursuant to its contract with PSALM,” company president Emmanuel R. Ledesma Jr. has noted.

He added that “environmental clean up is among the obligations of buyers of decommissioned plants, including Gagasan (for the Manila thermal facility).”

The task on the PCB clean up has been bestowed to the Philippine National Oil Company-Alternative Fuels Corporation (PNOC-AFC) based on a deal entered into by the buyer with relevant government entities.

Ledesma explained that PSALM “is holding on to a portion of Gagasan’s bond corresponding to the cost to government of (its) remaining contractual obligations.”

He further qualified that “as to technology for the disposal of the PCB equipment, the DENR (Department of Environment and Natural Resources) allows only PNOC-AFC to handle the disposal, so any other technology is irrelevant.”

He thus emphasized that PSALM then required Gagasan “to enter into an agreement with PNOC-AFC for the disposal of transformers with PCB oil.”

Based on latest developments, Ledesma bared that the PNOC affiliate firm “is revising its contract price for the destruction of the PCB equipment.”

He validated reports though that “the PNOC-AFC machinery to destroy the PCB equipment is not yet operational.”

PSALM, Ledesma reiterated, is obligated to ensure compliance with laws, such as mandated clean-up processes, even after getting the payment from the sale of its power assets.

Tuesday, November 29, 2011

CSO groups urge WB to stop funding ‘dirty energy’ projects

Business Mirror

CIVIL-society organizations (CSOs) from developing countries urged the World Bank (WB) to cut financing for energy projects that use coal or other similar environmentally harmful materials and finalize its energy strategy for the next 10 years.
In a report titled “Unclear on the Concept: How Can the World Bank Group Lead on Climate Finance without an Energy Strategy?” released at the climate talks in Durban, South Africa, the CSOs said despite WB’s clean energy campaigns, nearly half of the bank’s lending, or more than $15 billion, went to fund “dirty energy projects” like fossil fuels in the last four years.

“The World Bank cannot take a leadership role in global climate finance when it has no energy strategy to offer other than its gross and growing fossil fuel lending portfolio. The Bank’s fixation on centralized, coal power harms the climate and fails to address the central issue—energy poverty—plaguing developing countries today.

Instead, intervention should focus on the provision of energy access needs, where distributed renewable-energy [RE] systems is the proven cost-effective solution,” Red Constantino, of the international developing country group Basic South Initiative, said.

The report included data from the “Shift the Subsidies” database, which tracked multilateral development bank energy lending. It also showed how WB is experiencing difficulties in synching its core lending with climate goals.

Given the difficulties and contradictions, the groups said the WB should focus on cleaning up its act before making forays into climate finance initiatives. Civil-society advocates claim this lending directly undermines the institutions credibility as a leading institution in climate finance.

“The Bank should put its money where its mouth is and stop financing dirty energy,” said Karen Orenstein of Friends of the Earth.

Further, the groups said the WB is unable to finance its own energy strategy that will guide lending at the institution for the next 10 years. Without an energy strategy, the groups said the WB is risking its institutional credibility with its current consideration of a new coal project in Kosovo.

The project will provide public financing for the most heavily polluting form of coal (lignite) and comes on the heels of the WBG decision last year to lend more than $3 billion to help build the Medupi coal plant in South Africa.

The groups claimed that WB’s actions such as its core energy lending, its inability to pass a forward-looking energy strategy, and its mixed involvement in climate-related initiatives, only demonstrate that it does not take climate change impacts seriously.

“Credibility is a critical facet among institutions vying to leverage or manage climate finance flows. Unfortunately, it is doubtful the Bank has much to share in the Durban negotiations in this regard,” Constantino said.

UN to developing countries: Adapt RE technology

Business World Online
Posted on November 29, 2011 10:54:41 PM

DEVELOPING countries need to encourage research to adapt renewable energy technologies for local use as alternative sources could be more cost effective than traditional supplies, a report from the United Nations Conference on Trade and Development (UNCTAD) said.
The report noted developing countries still have difficulty in localizing renewable energy technologies despite the existence of policies promoting clean power because of the poor absorptive capacity. Absorptive capacity is the ability of a country to identify important sources of knowledge and technological changes to route to internal learning processes to build its own competitive advantages.
The Philippines, despite being cited as one of the countries which has a renewable energy policy directed at developing technologies, is still finding it difficult to adapt.
“The major barrier to adapting renewable energy technologies is still the relatively higher cost of some technologies like wind and solar versus conventional plants at present. Since our electricity rates are not subsidized and considered as one of the highest worldwide, the alleged higher burden to consumers is the main argument against renewable energy deployment,” said Pedro H. Maniego, chairman of the National Renewable Energy Board (NREB).
“Eliminating energy poverty and promoting greater access to energy to promote economic development therefore requires serious consideration of how renewable energy technologies could complement and/or even substitute conventional energy sources.
“However, a large proportion of the global population cannot afford these conventional energy supplies. According to estimates of the International Energy Agency (IEA), over 20% of the global population lacked access to electricity in 2010,” the report noted.
Developing countries are unable to adapt renewable energy technologies to their own environment as they are “more expensive than conventional sources of energy, mainly because price estimates of conventional energies do not usually include the costs of grid connections and storage.”
Only a limited number of developing countries are “steadily making their mark” as renewable energy developers and it is developed nations that is leading the charge. It is mostly Brazil, China and India that is innovating renewable energy. The report said “systemic failures exist as well, which undermine possibilities of expanding into renewable energy technologies in developing countries. Most importantly, countries and sectors are path-dependent, and renewable energy technologies face systemic risks of not being adapted, used or applied in other sectors of the economy.”
Developing countries can increase their absorptive capacities by adopting a national policy framework which includes the creation of research and development centers. However, the report notes half of the renewable energy policies enacted in 2010 came from developing countries.
The expense and patents of renewable energy technologies can be a barrier but the report recommends governments to look into international financing. -- Emilia Narni J. David

EDC to acquire geothermal contracts in Chile, Peru

Business World Online
Posted on November 29, 2011 10:17:32 PM

LOPEZ-LED ENERGY Development Corp. (EDC) has moved to acquire controlling stakes in four geothermal sites South America, the company disclosed to the bourse yesterday.
EDC said it signed a deal with Australian firm Hot Rocks Ltd. to take over a 70% interest in areas in Peru and Chile without specifying the acquisition cost.

The areas are “in the volcanic regions of Calerias and Longavi in Chile and the Quellaaparcheta and Chocopata regions in Peru.”

“We are excited with the prospect of developing with Hot Rock what we consider as some of the best geothermal concessions in both Chile and Peru. The ability to grow our business with full control over our steam fuel supply is the strategic rationale for the Lopez group’s acquisition of the controlling stake in EDC,” EDC President and Chief Operating Officer Richard B. Tantoco said in a separate statement.

Mr. Tantoco said the firm’s 35-year experience in geothermal field operation has enabled it to vie for markets overseas.

The company earlier said it wants to pursue international projects as a means to expand its geothermal footprint.

The transaction between EDC and Hot Rocks “remains subject to the further satisfaction on certain conditions, which include fully termed documentation, confirmatory due diligence and necessary regulatory and governmental approvals.”

The agreement entails the establishment of joint-venture companies for each of the sites.

EDC said Hot Rocks had already completed most of the exploration activities in the four areas and hopes to finish all surface exploration within the next six months.

The development comes as EDC pursues plans to expland abroad, having already submitted applications for 13 sites and also bidding on five sites in Chile.

It is also looking at geothermal projects in Indonesia, Kenya and Peru, according to earlier reports.

In the meantime, EDC had posted a loss of P487.7 million in the nine-month period ending September from an income of P7.6 billion in the same period last year.

The company had to close the Bacon-Manito (BacMan) steamfields in preparation of the recommissioning of the BacMan power plants in the third quarter.

Revenues for the nine-month period ending September fell 5.7% to P18.2 billion from year-ago levels of P19.3 billion.

Aside from operating the 130-megawatt (MW) Bacon- Manito geothermal power plant in the Visayas, EDC also runs the 305-MW Tongonan I geothermal power plant, the 192-MW Palinpinon geothermal plant in Leyte and the 132-MW Pantabangan-Masiway hydroelectric power plant in Nueva Ecija.

Shares of EDC closed at P5.99 apiece yesterday, down 0.17% from its previous close of P6. -- Emilia Narni J. David

EDC seals deal to set LatAm expansion

Business Mirror

GEOTHERMAL giant Energy Development Corp. said on Tuesday it is making headway in its overseas expansion targets after it sealed a deal with Hot Rock Ltd. (HRL), an Australia-based renewable energy company holding one of the largest geothermal acreages in that country. 
EDC said in a statement that HRL signed a heads of terms agreement (HOTA) that gave EDC a 70-percent equity with respect to HRL’s four geothermal projects in Chile and Peru.

The agreement sets the framework and main commercial principles for EDC’s acquisition of a 70-percent interest in the granted volcanic Calerias and Longavi geothermal projects in Chile, where EDC has a representative office, and the Quellaapatcheta and Chocopata geothermal projects in Peru. 

Completion of the proposed transaction remains subject to the satisfaction of certain conditions, including fully termed documentation, confirmatory due diligence and necessary regulatory and governmental approvals.

EDC noted that HRL has already completed most of the surface exploration activities in the geothermal projects. Within the next six months, both EDC and HRL intend to immediately finish the remaining surface exploration activities. 

Based on the HOTA, EDC and HRL will establish joint-venture companies to hold each of the geothermal projects, with EDC owning a 70-percent interest and HRL maintaining a 30-percent stake.

“We are excited with the prospect of developing with Hot Rock Ltd. what we consider as some of the best geothermal concessions in both Chile and Peru. The ability to grow our business with full control over our steam fuel supply is the strategic rationale for the Lopez Group’s acquisition of the controlling stake in EDC,” Richard Tantoco, EDC President and Chief Operating Officer, said. 

“We are well on our way to becoming a true national champion, where Filipino expertise will be used to bolster a position of leadership in a global industry,” the EDC official said. 

Mark Elliot, HRL Executive Chairman, said his company is excited to undertake the agreement that establishes the company’s first major partnership deal with EDC.

As part of its aggressive growth targets, EDC has submitted direct applications for 13 sites and bids for five sites in Chile. EDC is also looking at opportunities to develop geothermal projects in Indonesia, Kenya and Peru.

EDC is the world’s largest integrated producer of geothermal power and the acknowledged global leader in wet steam technology. It is engaged in the exploration, development and optimization of geothermal fields, as well as the operation and maintenance of the geothermal power plants with an aggregate capacity of 1,130 megawatts.

Palawan power shutdown looms

Manila Standard Today
Puerto Princesa City—-A key official has called on President Benigno Aquino III to help sustain the travel sector’s momentum in Palawan by settling the P240-million debt of the National Power Corp. to independent power producers amid fears of a looming shutdown.

Rebecca Labit, assistant city administrator and city tourism officer, said any delay may reverse hard-earned gains.

“The city and the entire Palawan would lose all the tourists coming in droves if President Aquino fails to provide immediate financial assistance and settle the obligations of Napocor to the IPPs,” she said.

The Puerto Princesa City Power Commission has unanimously approved a resolution last Nov. 18 to seek President Aquino’s assistance to pay Palawan Power Generation Inc. and Delta P P120 million each, to settle subsidy billings for May, June, August and September 2011.

The commission said PPGI had warned Napocor president Froilan Tampinco last Nov. 2 of a power crisis with present finances allowing “two weeks supply of fuel for power generation in the city and the province, after which these areas will experience power shedding and eventually suffer frequent long power outages unless they will be provided with the much needed assistance.”

The PPC resolution cited a quick solution if President Aquino agreed to give Puerto Princesa Mayor Edward Hagedorn the city’s share of the revenues from the Malampaya Natural Gas Project.

The Palawan Chamber of Commerce and Industry Inc. alongside Palawan Filipino-Chinese Chamber of Commerce and Industry Inc. expressed support to the Hagedorn remedy.

“It is striking that Palawan, which provides the natural gas to produce one-third of Luzon’s electric energy needs, finds itself a supplicant for a mandated subsidy of the national government. Ironically, the current shortfall would be an ideal and intended application of royalties from the Malampaya Fund,” chamber officials said.

Power firm accuses Cebu luxury hotel of theft

By Karlon N. Rama
Tuesday, November 29, 2011

CEBU CITY (Updated) -- The Visayan Electric Co. (Veco) filed Monday a criminal complaint that accuses a Cebu City-based hotel of pilfering over 27 million kilowatt-hours of electricity, worth at least P168 million, between April 2007 and February 2011.

Through Ricardo Lacson Jr., its vice president for administration and customer service, Veco accused the hotel of cutting two cables Veco installed so that the hotel could, while continuing to draw power, bypass two of the three meters set up to monitor power consumption.

This, according to Lacson’s affidavit, was done “intelligibly, with deliberate intent and with intent to gain.”

In a statement, the hotel said it “vehemently denies any allegations of criminal wrongdoing.”

“These issues may already have been ventilated and submitted for resolution before the Energy Regulatory Commission (ERC), where a case was filed by Waterfront against Veco last April 2011 and a cease-and-desist order against Veco has been issued,” the hotel management said.

Hotel representatives declined to comment further.

“In the meantime, Waterfront and its officers and staff would like to assure its guests, the Cebuano community and the general public of its continued operations and services and it will bring these baseless accusations to a proper resolution,” the statement read.

The ERC-Central Visayas also confirmed Monday that Waterfront Hotel indeed filed a consumer complaint against Veco last April.


ERC-Central Visayas Director Joel Bontuyan said the hotel management filed the complaint after Veco allegedly threatened to cut off their power connections.

Bontuyan said the complaint was filed by the hotel management with their central office in Manila, which conducted a hearing with the hope of reaching an amicable settlement.

Only the court can determine if there was any criminal liability, he said.

At that time, Bontuyan said, Veco asked for P69 million but Waterfront offered only P2 million.

Veco, through lawyer Jess Garcia, filed the complaint against Waterfront before the Office of the Cebu City Prosecutor. Following office procedures, the complaint will be raffled to a prosecutor for preliminary investigation within the week.

The complaint cites Republic Act (RA) 7832, or the Anti-Electricity and Electric Transmission Lines/Materials Pilferage Act of 1994.

It impleads Kenneth Gatchalian, hotel president; Marco Protacio, area general manager; Carlo Sainz, resident manager; Ferdinand Vincent Lazaro, group chief engineer; Loulainetto Lauron, chief engineer; and Jose Francis Cañizares, assistant engineer.

Zero reading

Based on Lacson’s affidavit, the hotel’s alleged violation was discovered last February 7, 2011, when a group from Veco conducted a “routine check” on the hotel’s power substation.

According to Lacson, their technical people found the severed cable and noticed that two of the hotel’s three meters had “zero reading.”

He said Veco personnel then fixed the severed cables, referred to in the complaint as two #10 AWG wires, and then attached a seal to prevent tampering.

However, in a follow-up inspection last February 11, inspectors supposedly found the wires to have been cut again.

Veco, in its complaint, placed damages as a result of the incident at P168 million, saying the hotel managed to siphon off 27,469,951 kilowatt-hours from April 2007 to February 2011.

Garcia, interviewed at the Office of the Cebu City Prosecutor, did not state why the utility company believed that the alleged pilferage began in 2007 yet, saying only that they “found indications in the substation grounds.”

“The bottom line is they consumed electricity they didn’t pay for,” he said.


RA 7832 prohibits, among other things, the tapping of overhead lines, tapping into the electric service of others, and tampering with or destroying electric meters, wires or conduits “to interfere with the proper or accurate metering of electric current.”

Knowingly receiving the “direct benefit” of electricity obtained through prohibited means is already a violation under the 1994 law.

The presence of tampered, broken, or fake seals on a power meter is considered prima facie evidence. As penalties, the law specifies imprisonment, fine, or both, at the discretion of the court.

In reaction to acts of tampering, utility firms have the right to “disconnect immediately” a client’s service after serving a written notice or warning “without the need of a court or administrative order.”

Utility firms may also “deny restoration of the same.”

Ethel Natera of Veco’s Corporate Communication Department, for her part, said they made prior demands on the hotel before lodging the criminal complaint.

However, she added, the hotel did not act on it.


A source from the Veco side said the hotel instead filed an administrative complaint for direct connection with the ERC, a fact confirmed by an entry in the June 2011 case calendar of the ERC.

Asking not to be identified, the source revealed that administrative complaint sought the ERC’s help in stopping Veco from disconnecting the hotel’s power connection while the administrative hearing is ongoing.

The ERC issued a temporary injunction, as borne out in the hotel’s press statement Monday, and the hearing remains ongoing.

Natera explained that they are constantly watching out for similar incidents but pointed out that alleged pilferage of Waterfront is the biggest they have discovered thus far.

She confirmed that Veco made a similar demand on another hotel sometime ago. The hotel settled out of court and made a public apology.

Like in the previous case, Garcia said, Veco is “open to a settlement.” (With Elias O. Baquero and Kat O. Cacho/Sun.Star Cebu)

Published in the Sun.Star Cebu newspaper on November 29, 2011.

Monday, November 28, 2011

Benguet Corp. infuses P247M into nickel unit

Philippine Daily Inquirer
8:28 pm | Monday, November 28th, 2011

Benguet Corp. announced that it would infuse P247 million in additional equity to its wholly owned subsidiary, BenguetCorp Nickel Mines Inc. (BNMI).
This additional investment will bring BNMI’s paid up capital to P1.25 billion and enable BNMI to complete the development of the Sta. Cruz nickel project.
BNMI operates the 1,406.7-hectare nickel tenement in Sta. Cruz, Zambales, and has been exporting high-grade nickel ore to various markets.
In the second semester of the year, it signed off-take agreements for shipment of 3.8 million tons of high-grade nickel ore over the next three years.
BNMI continues to pursue a medium-term plan that will transform the company from a simple direct ore exporter into a producer of processed nickel.
Included in the plan is the adoption of an innovative low-power consuming technology that will upgrade the quality of the lower-grade ore.
This was the subject of a recent technical team visit to China.
The operations of BNMI in Zambales is contributing to the social upliftment of the surrounding community by providing local employment and other community services, such as scholarship grants, nutrition programs, medical missions, livelihood projects and tree-planting activities.
Since 2008, BNMI has planted a total of 48,100 trees in Sta. Cruz, Zambales, covering an area of 28.68 hectares. This program is still being undertaken.

Alsons eyeing Guam, Saipan power plants

Manila Standard Today
by Alena Mae S. Flores

MAASIM, Sarangani—Alsons Consolidated Resources Inc. of the Alcantara Group is expanding its power business into Saipan and Guam in the next three years, a company official said here over the weekend.

Joseph Nocos, vice president of unit Conal Holdings Corp., said Alsons Consolidated would join a power bidding in Saipan next month. Saipan is seeking proposals to supply about 40 megawatts to 50 MW of power in the island.

“They are bidding out concessions for generation, distribution and transmission, around 40 MW to 50 MW of diesel generating capacity. Power is already needed there now,” Nocos said.

He said Saipan was seeking investors for its power requirements in the hopes of “bringing down costs, improve service and relieve government of financal burden.”

Construction of 200-MW coal power plant in Sarangani begins

By Bong S. Sarmiento | Monday| November 28, 2011

GENERAL SANTOS CITY (MindaNews/27 November) — It’s all systems go for the controversial Alcantara-led coal power plant project in a world-class diving spot in nearby Maasim, Sarangani, with groundbreaking rites held last Friday.
Tomas I. Alcantara, chair and president of Alsons Consolidated Resources (ACR), led the groundbreaking rites for the $450 million coal-fired power plant, the first phase involving 100 megawatts (MW) targeted for completion by 2014.
Alcantara said the entire project will generate about 200 MW of “safe, reliable and affordable energy” to the people of Socsargen (South Cotabato, Sarangani and General Santos City) and the rest of Mindanao and will provide employment to at least 500 workers during the construction period. Around 150 workers will be hired when the plant goes on stream, with preference for local residents, he added.
The power plant will employ modern and world-class equipment and technology to ensure “minimal environmental impact,” he said.
Religious, civil and militant organizations and environmental groups are opposing the coal power plant citing adverse effects on health and the environment.
Last year, the opposition gained international support with the sailing of Rainbow Warrior, Greenpeace’s advocacy ship, in Maasim town.
Alcantara said that as part of the company’s commitment to protect and enrich the ecosystem of Sarangani Bay, they would continue restocking or dispersing various species of fish produced in the nurseries of an affiliate company.
“This is our effort to ensure the continued health of our waters and the protection of the livelihood of our fisherfolk who are dependent on our municipal waters,” he said.
The newly created Sarangani Energy Corporation will pursue the coal power plant project. The project was issued an environmental compliance certificate by the Department of Environment and Natural Resources in 2009.
Joseph Nocos, Conal Holdings Corp. Vice President, had earlier said the second phase of the coal power project would begin a year after the completion of the first phase.
The first phase is slated for completion in 36 months or late 2014, when Mindanao is projected to have a supply shortfall, he said.
Conal Holdings is 60% owned by the publicly listed ACR and the rest by the Electricity Generating Public Co. Ltd. or EGCO, Thailand’s largest power producer.
Sarangani Gov. Miguel Rene Dominguez, an Alcantara scion, has thrown his support to the coal power plant project, noting this could be a “magnet of investment” for other industries in the area.
Several months ago, company officials announced that a power supply agreement with the South Cotabato Electric Cooperative 2 (Socoteco-2) had been reached.
Under the power supply deal, Sarangani Energy will provide a dedicated supply of 70-MW to the Socotecto-2 which serves this city, the whole of Sarangani and parts of South Cotabato. (Bong Sarmiento/MindaNews)

Alsons Targets More Overseas Projects

Manila Bulletin
November 28, 2011, 1:18am

MAASIM, Sarangani — The publicly-listed Alsons Consolidated Resources Inc. of the Alcantara group is setting its sights on more overseas expansion with the North Pacific Islands – primarily in Saipan and Guam – as its new investment destination.

This will add to the company’s portfolio of offshore forays, having established already its niche in some Asian key markets – such as China, Indonesia, Vietnam and Pakistan via some involvements in various facets of operations and implementation of thermal power projects.

In an interview here, Alsons power group vice president for business development Joseph Nocos disclosed that they are joining the bidding for the proposed concession deal for Saipan’s vertically-integrated power needs.

“It is embedded within the Saipan area. So they have a bidding that has been announced. They will bid out a concession for the generation, transmission and distribution in the island of Saipan. That’s like what they did with TransCo (National Transmission Corporation) in the Philippines,” he explained. The deadline for the submission of expressions of interest (EOI) will be on December 12 this year.

With a reference price of 40 US cents per kilowatt hour (kWh), Nocos noted that this will be “an opportunity for us with vast experience in power generation…if we win that bidding, that will mark our foray into the North Pacific Islands.”

Saipan island is reportedly in need of additional capacity and the tender notice sent out to prospective investors may cover up to 70 megawatts. The facilities being planned will likely be on fast-track basis as the area is already badly in need of additional power supply.

“The plan is to replace the units with more efficient ones because these are already old,” the Alsons executive has emphasized.

For Guam, the prospect will be for additional 30 to 40 megawatts of capacity which the island needs by 2013.

“The opportunities for the private sector in Guam (are) coming into view as they get closer and closer into the relocation of the US forces from Okinawa to Guam,” Nocos said.

He qualified “when that happens, you will see a lot of interest and opportunities in Guam. Their need will be another 30 to 40 megawatts. We’re looking into that opportunity and see if it will be sound for us to join their bidding.”

A two-pronged plan has been presented as to how this part of the US territory would be building up on its power capacity – one would be for its Guam Power Authority to shell out the required investments; or they may opt to invite independent power producers (IPPs) to set on stream their needed capacity.

Alsons is just among the local energy companies firming up plans for investments outside the country. Albeit in its case, it has already gone notches ahead as compared to the other Filipino firms which have yet to pull their project blueprints from the drawing board.

Sunday, November 27, 2011

Board member: Tax electric coops now

By Florence F. Hibionada
Sunday, November 27, 2011

THE Provincial Board is set to deliberate the imposition of real property tax (RPT) from all electric cooperatives in Iloilo City.

Board Member Gerardo Flores, in a privilege speech Friday, proposed the move as he pointed out to the body a Supreme Court (SC) ruling that supposedly allows now RPT collection.

Does Gloria Arroyo deserve to be placed under house arrest? Cast your vote.

Such, as he noted the lifting of an earlier temporary restraining order (TRO) that held off imposition of said tax dues.

Electric cooperatives in the country, including the Iloilo I Electric Cooperative Inc. (Ileco 1), hurled to court the Department of Interior and Local Government and the Department of Finance.

The contention was that Sections 193 and 234 of Republic Act 7160, otherwise known as the Local Government Code, were unconstitutional.

The electric cooperatives’ position was that government incentives are in place and guaranteed among others the permanent exemption from payment of income taxes. The group said Presidential Decree 269 covered this, thus the exemption from payment of local taxes, including RPT.

While Sections 193 and 234 of RA 7160, the electric cooperatives said, effected the withdrawal of said tax exemption. The group added the provision discriminated the industry and was “in violation of equal protection of the law clause.”

But Flores said the petition and position of the electric cooperatives have been denied after the earlier TRO issued was lifted.

“With the above decision of the Supreme Court, only those cooperative under the Cooperative Code of the Philippines are exempted from the LGU’s taxing powers and effect, renders Ileco 1 and the rest of the electric cooperatives in Iloilo, which are not registered under RA No. 6938, taxable,” Flores said.

“In this regard, this representation would like to propose that with the lifting of the TRO, the provincial assessor and the municipal assessor to make a classification, appraisal and assessment of all properties of Ileco I, II, III, and to assess the taxes of these electric cooperatives on every host LGU for ten years thereto,” Flores added.

At the center of this recurring issue is the Department of Justice’s stance that in order for a cooperative to enjoy incentives granted by RA 6938, the registration with the Cooperative Development Authority (CDA) is required. With that, no CDA registration, no exemption.

The Bureau of Local Government Finance in Memorandum Circular No. 13-2003 stated that the same wherein only electric cooperatives registered with the CDA are exempt from RPT.

Government to check reports Asean countries subsidizing power

Business Mirror

GOVERNMENT think tank Philippine Institute for Development Studies (PIDS) will investigate reports that other Southeast Asian countries are subsidizing the power rates of their industries, thus giving them undue advantage over Philippine companies.

“We can bring this up in the WTO [World Trade Organization] for unfair trade practice or negotiate it in the Asean,” Josef Yap, PIDS president, said.

Yap said he received information that some countries in the region appear to be giving subsidies and special rates to their manufacturers and exporters, which contributes to their relatively lower power rates compared to the Philippines.

If this is true, Yap said this is a form of subsidy for the exporters that distorts trade.

“That is something that we will look at. We will investigate if other countries are subsidizing their power,” Yap said.

He said it is no longer a myth that the Philippines has already surpassed Japan on having a high cost of electricity.

Besides being less competitive in the international market, the Philippines is also losing investors to other countries in the region because of the relatively higher power rates in the country.

The high power rates in the Philippines, he said, is one major reason the manufacturing sector here continues to shrink, along with inadequate infrastructure, low investment rate and weak institutions that give rise
to governance concerns.

He noted that the share of the manufacturing sector to the country’s gross domestic product has been continuously dwindling, dropping from 25.7 percent in the 1980s to 22.2 percent in 2000 and then to 21.4 percent in 2009.

“During this period, the share of the manufacturing sector in Indonesia, Malaysia and Thailand increased sharply. This is the main reason that these countries have become more progressive than the Philippines,” Yap said.

Jesus Arranza, chairman of the Federation of Philippine Industries, said the high power rates, poor infrastructure and smuggling are the “headwinds” that are slowing down the pace of the growth of the manufacturing sector in the country.

DOE to speed up signing of pending renewable-energy projects

Business Mirror

THE Department of Energy (DOE) is looking into accelerating the approval of the pending renewable-energy (RE) contracts, Energy Undersecretary Jose Layug Jr. told reporters.
The DOE official said in an interview the signing and release of the pending RE contracts is under way.

Layug said he has already signed five RE contracts that involved large hydropower and run-of-river hydropower facilities, which he has endorsed for signing to Energy Secretary Jose Almendras.

“In May we were anticipating 61 contracts. But now we expect a faster pace in signing and releasing these contract,” Layug said.

The DOE also said it has yet to award or approve the 384 pending RE project applications.

It said 191 of the 384 pending applications involve hydropower projects, 70 for solar, 59 for wind, 28 for biomass, 21 for ocean energy and 15 for geothermal projects.

The projects have a potential to generate 6,046.45 megawatt (MW) of electricity.

The biggest projects per technology resource are Pan Pacific Renewable Power Philippines Corp.’s 600-MW project in Apayao hydropower project; Coastal Power Development Corp.’s 420-MW wind power project in Sorsogon; Jobin-Sqm Inc.’s 100-MW solar power project in Zambales; Eoil and Gas Co. Inc.’s 60-MW geothermal power project in South Cotabato; and Green Power Bukidnon Philippines Inc.’s 35-MW biomass power plant project in Bukidnon.

As of July 4, a DOE report showed 236 contracts have already been awarded to RE developers, which have the potential to generate 2,822.97 MW of electricity.

It added that 164 of the 236 contracts are currently on predevelopment stages, while 72 are on development stages.

On a per technology basis, the DOE said it has awarded a total of 124 contracts for hydropower, three for ocean energy, 21 for geothermal, 46 for wind, two for solar and 40 for biomass.

It added that hydropower projects continue to top the list with 124 contracts being awarded, followed by wind at 46; biomass, 40; geothermal, 21; ocean energy, 3; and solar, 2.

Leyte electric co-op applies for P1-M capex

Business Mirror

LEYTE-V Electric Cooperative Inc. (Leyeco V) is applying with the Energy Regulatory Commission for a capital expenditure (capex) at the colossal cost of P1.045 billion.

Just exactly how Leyeco V plans to spend this is outlined in its application: The electric cooperative breaks its five-year development plan into seven projects.

The biggest chunk of the Capex will go to subtransmission development which largely entails the acquisition of 69 kiloVolt (kV) lines from the National Grid Corp. of the Philippines (NGCP) pursuant to Republic Act 9136 (Electric Power Industry Reform Act) Sec. 8, Par. 3. These lines are Lemon-Biliran, Milagro-Ormoc and Ormoc-Talisayan.

Aside from lines acquisition, the subtransmission development will also involve construction of lines to Leyeco V’s substations in Mahayag, Isabel; Simangan, Ormoc; Talisayan, Albuera; Libongao, Kananga; Tabango-Palompon; Isabel-Palompon, as well as the refurbishment of the NGCP line to Leyeco V’s substation in Tabango.

The second biggest cost of the DDP is substation development. Leyeco V warns that four of its five substations will exceed the 70 percent maximum rated capacity by 2014. Hence, additional capacity is needed with the construction of new substations in Ormoc (20MVA), Palompon (10MVA) and Kananga (5MVA).

The third biggest cost is the renewal projects. Leyeco V plans to fix the undersized line conductors as well as overextended secondary lines and service drop wires so that its 13.04-percent systems loss will be improved below the ERC’s 13-percent cap or even lower to a single-digit mark. It also wants to replace 25,737 defective meters and 3,775 dilapidated poles.

If the DDP is not implemented, Leyeco V System Planner Michael Guiñarez forecasts that the system loss will gradually increase to 18.4 percent in 2020 based on their simulation. Consumers will bear the systems loss which will be reflected on their electric bill.

Non-network projects which comprise the fourth-biggest cost will go to the following:

· Renovation of Leyeco V’s main office, P2 million (2012-13) to include the construction of a customer’s lounge at the front and a covered walk leading to the building;

· Construction of new multipurpose building, P3 million (2012) to accommodate gatherings including the annual general assembly;

· Renovation of engineering building and warehouse, P1 million (2013);

· Acquisition of 16 units utility truck (4WD), P12.8 million (2011-15);

· Acquisition of four units boom truck, P25 million (2012-13) for easier and faster line construction;

· Information technology and equipment upgrading to include computers and accessories, construction of radio repeater and other gadgets, P10 million (2012-15);

· Distribution Management System Development, P7 million to include computerization of accounting system (2012), geographic information system (2013);

· Supervisory Control and Data Acquisition, P8 million (2013-1205) which involves setting up a control center to remotely detect line problems for faster response.

Saturday, November 26, 2011

Socoteco II power rates up

By Edwin G. Espejo | Saturday| November 26, 2011

GENERAL SANTOS CITY (MindaNews/26 November) — Electricity costs went up by at least P0.31 per kilowatt hour for November following the disruption of power supply early in the month as shown in the latest billings released by the South Cotabato II Electric Cooperative (Socoteco II) this week.
Socoteco II institutional services manager Geronimo Desesto said power costs went up following a P0.238 spike in the generation charge imposed by Therma Marine Inc. from where the utility firm sourced its supply shortfall when one of the two power plants of STEAG in Misamis Oriental was shut down for preventive maintenance.
Transmission and systems losses costs also increased by P0.07 pushing the power rate increase to P0.31 per kwh (kilowatt hour).
“Tamaas din ang transmission cost kasi tamaas ang generation charges. Sa Therma Marine natin kinuha yung kulang,” (Transmission and systems losses costs also increased because we sourced our shortfall from Therma Marine) Desesto explained.
The cost of electricity is expected to drop in the December billing of Socoteco II.
Socoteco II general manager Rodrigo Ocat however said power rates could go as high as P6.24 per kilowatt in February next year when the power sales agreement between the electric cooperative and Therma Marine takes effect.
At the moment, Socoteco II is charging its consumers an average of P5.45 per kilowatt hour to include value added tax.
Ocat said they have entered into a contracted with Therma Marine Inc. for an 18-megawatt supply to cover up for the announced reduction of supply from the National Power Corporation (Napocor or NPC).
Therma Marine is owned by the Aboitiz Power group which purchased two of NPC’s power barges that have combined capacities of 220 megawatts.
The NPC had earlier announced that it can only supply up to 70 percent of total requirements of Socoteco II starting next year, according to Ocat.
Supply could go down further upon notice because of the delicate and declining available capacities from NPC’s generating plants.
Socoteco II needs a base load capacity of at least 70 megawatts by early next year. The power distribution firm however has a peaking requirement of 107 megawatts. Demand for power supply is expected to increase once mall giant Shoe Mart (SM) opens in the second quarter of next year.
Power supply and sales agreement between Socoteco II and NPC have been shortened to three years due to precarious and declining generating capacities of the state-owned power company.
Socoteco II has also entered into a power supply agreement with the Alcantara-owned Sarangani Energy Corporation (SEC) which is building a 200-megawatt two-phased coal fired power plant in Maasim, Sarangani.
The power plant is expected to start generating electricity late 2014.
Representatives from both Socoteco II and SEC said they expect power supply to stabilize and power rates to go down once the new power plant begins commercial operation.
Investors and stockholders of SEC were in Maasim Friday to lead the groundbreaking ceremonies of the power plant project which is estimated to cost a total of US$450 million or P19.4 billion. (Edwin G. Espejo/MindaNews)

Alcantara coal plant breaks ground

Manila Standard Today

MAASIM, Sarangani—The Alcantara Group’s Sarangani Energy Corp. on Friday broke ground on its 200-megawatt coal-fired plant project, which is estimated to cost $400 million to build and reduce electricity rates by as much as P1 per kilowatt-hour over the long term, officials said here.

“The construction of our coal plant here will improve reserves and increase availability of supply in southern Mindanao,” Joseph Nocos, vice president for business development of Sarangani Energy, said during a briefing.

“The plant will bring down [blended] rates by P0.30 to P0.50 per kWh by 2014, and around P1 per kWh in the next eight years,” Nocos said, refering to the cost of power supplied by South Cotabato II Electric Cooperative to consumers in southern Mindanao.

The coal plant is one of the several power plants slated to be built by the private sector in response to a looming power shortage in Mindanao by 2014. Generation facilities in the island have been unable to keep with Mindanao’s growing population and expanding economy.

Mindanao needs around 600 MW of additional power capacity to avert an impending power shortage. The Sarangani coal plant is expected to cover one-third of the island’s project power deficit in 2014.

Energy Secretary Jose Rene Almendras welcomed the project, saying it was “the beginning of a solution to the Mindanao situation.” Mindanao suffered power outages last year during the El Niño weather phenomenon, which cut production from the hydropower plants. Mindanao depends on the bulk of its power requirements from hydro plants.

“I hope there will be more non-hydro baseload generation projects that will follow. Ideally we should have 500 MW of non-hydro baseload generation in Mindanao,” Almendras said when asked for comment.

Trade Secretary Gregory Domingo, who graced the groundbreaking ceremonies, said the project would spur investments in Mindanao.

“This will be a very big help to businesses, if there is a shortage of power, it caps the economic growth of the area. This project takes out one of the critical constraints for growth of an area,” Domingo said. “As we add more [power} capacities, that will bring pressure on the rates to go down.” Alena Mae S. Flores

NEA grants loans for electric cooperatives’ upgrade

Published : Saturday, November 26, 2011 00:00 Written by : Euan Paulo C. Añonuevo

THE National Electrification Administration (NEA) has released a set of loans to electric cooperatives for repairs and maintenance, network improvement and debt payments.
In a statement, NEA said the loans totaling P794 million would benefit 38 utilities. “NEA encourages the ECs to avail of its Enhanced Lending Program since the loans being offered have competitive interest rate,” the agency said.

Its lending program provides an interest rate of 9 percent per annum for loans to be repaid in more than two years, and 8 percent per annum for loans to be paid two years or less. The other features of the program include no other charges for term loans; longer repayment period, i.e. from three to five or five to 10 years; fast processing; electronic fund transfer; minimum requirements; assistance in the preparation of project feasibility studies; and personalized service.

Among those who have availed of the loans are Kalinga Apayao Electric Cooperative Inc. (P5 million), Cagayan II Electric Cooperative Inc. (3 million), Isabela II Electric Cooperative Inc. (P12 million), and Aurora Electric Cooperative Inc (P5 million), for the rehabilitation of their damaged distribution system wrought by typhoons Juan, Pedring and Quiel.

Also, loans were granted to 15 ECs to assist them in the reduction of their annual systems loss by at least 1 percent and thereby improve system reliability. Another 11 ECs availed loans totaling P195 million as working capital for their operations, while 21 others received P413 million for electrification projects.

PEP readies mining, energy ventures

Published : Saturday, November 26, 2011 00:00 Written by : Krista Angela M. Montealegre

PREMIERE Entertainment Philippines Inc. (PEP) is setting the stage for a possible venture into the energy and mining industries.
Maricel Baltazar, PEP deputy corporate information officer, said the company’s board approved the inclusion of mining and energy among its secondary purpose.

“The board sees there are a lot of opportunities if we set our sights on energy and mining prospects,” said Baltazar.

PEP will also change its corporate name to Premier Horizon Alliance Corp. because its current name is “too limiting to a particular industry.”

The board also approved the decrease in the company’s authorized capital stock from P1.8 billion to P563.56 million following the reduction of the par value of common shares from P1 to P0.25 per share, thus wiping out PEP’s deficit.

Incorporated in 1988, PEP, originally known as Premiere Films International Inc., was engaged in the business of producing foreign movies.

In 1997, the company ventured in the gaming industry as part of its whole entertainment offer. It acquired IT gaming company Digiwave Solutions Inc., which operates Pagcor’s e-Games stations in Metro Manila and nearby provinces, through a share-swap transaction

In 2008, PEP amended its company name to Premiere Entertainment Philippines Inc., which continues to offer broadcast rights for its film library titles for TV, video, cable and other medium requiring such titles.

Besides Digiwave, PEP has three operating subsidiaries, namely Premiere Events Palace Inc., PEP Metro Leisure Inc. and Premiere e-Teleservices Inc.

Its shares were unchanged at P0.315 each on Friday.

Friday, November 25, 2011

Discount scheme extension to cost PSALM P10B

By: Amy R. Remo
Philippine Daily Inquirer
11:40 pm | Friday, November 25th, 2011

State-run Power Sector Assets and Liabilities Management Corp. stands to lose P10 billion in revenue if it will be made to continue extending up to next year discounted power rates to economic zone locators.
PSALM president Emmanuel R. Ledesma Jr. said the estimated losses were based on the assumption that the discounted power rates would be extended for one more year, or up to the time when the open access and retail competition scheme would be implemented.
The amount, Ledesma said, referred to the “difference between the production cost of our remaining (power) plants and the discounted rates (charged to ecozone locators).”
Also, the government no longer has the capacity to continue supplying electricity to ecozone locators, which is currently being done through Manila Electric Co., under the Ecozone Rate Program (ERP).
“PSALM is not in a position to renew the power supply contract with Meralco. After the privatization of several power plants of the government, PSALM’s remaining sources of power are insufficient to supply the demand of Meralco,” Ledesma further explained.
Ledesma’s statements were made in reaction to calls made by Meralco, the Philippine Economic Zone Authority and members of the Semiconductor and Electronics Industries in the Philippines Inc. (Seipi) for the extension of the provision of discounts under the ERP by one more year up to December 2012.
The ERP is said to be benefiting 279 Meralco customers in industrial areas, which account for 43 percent of the country’s total merchandise exports or about $19 billion.
Recently, Seipi sent a letter dated Nov. 8, 2011 to Ledesma, the Department of Trade and Industry and the Department of Energy, appealing for the extension of the ERP.
In the letter, Seipi president Ernie B. Santiago and chair Norberto A. Viera stressed that the local semiconductor industry, with the prolonged weakness of the electronics market, “cannot afford any additional cost that would result in higher prices of our products. Even future expansions will be in question.”
Among the reasons it cited as to why the discounted power rates should be extended were that “market is weak and competition is bloody; every company needs every cost reduction it can get, and that there is an overcapacity in competitor countries and everybody is dropping their prices.”

DoF Prepares Borrowing For PSALM

Manila Bulletin
November 25, 2011, 11:30pm

MANILA, Philippines — The national government would borrow as much as P85 billion for Power Sector Assets and Liabilities Management Corporation (PSALM) next year, the Department of Finance (DoF) said Friday.

Finance Undersecretary Rosalia B. De Leon said that borrowing for PSALM would be a prudent decision as government financing cost is at least 50 basis points lower than state agencies.

De Leon said the funding for the state energy-firm will come from domestic and overseas markets.

“There’s no decision yet,” she said when asked about the borrowing structure.

But De Leon pointed that the P85 billion is separate from the government’s own financing requirement of P727.4 billion to finance its programmed budget deficit.

The borrowings of PSALM are not paid by the government but are passed on to consumers as part of a universal charge.

PSALM has obtained P75 billion in syndicated term loan early this year to meet working capital requirements and refinance debt that fell due earlier.

The agency said it was also exploring options for its future financing requirements, including tapping the capital markets to raise funds. As of end-2009, total liabilities of PSALM stood at $16.5 billion.

Finance Secretary Cesar V. Purisima earlier said that consolidating the liability management of the various state-owned companies would enable the government to better handle its debts.

This is because the government would be able to borrow at a lower cost which in turn would improve the country’s fiscal health.

When state-owned companies borrow, they seek sovereign guarantee for their borrowings to able to make it easier for them to convince investors to lend them money.

State-owned companies also shoulder a certain amount of premium when issuing new debt.

Ayala Land, Mitsubishi in energy tie-up

Manila Standard Today

Ayala Land Inc., the biggest property developer, has tied up with Mitsubishi Corp. of Japan to promote energy efficiency in the Philippines.

Ayala Land said in a disclosure to the stock exchange the two companies would form Philippine Integrated Energy Solutions Inc. that aims to lower energy consumption within the property firm’s large mixed-use development projects.

Ayala Land will own 60 percent of PhilEnergy while Mitsubishi Corp. will hold 40 percent.

Ayala Land will manage PhilEnergy while the Japanese partner will provide critical technical support through its extensive network of affiliated energy-saving companies with leading track records in Japan and around the region.

The partnership is the latest cooperation between Ayala and the Mitsubishi groups.

A key feature of the direction of the company is the implementation of the district cooling system in large Ayala Land mixed-use development projects, which will provide significant savings on capital expenditures and operating costs through increased efficiency in the consumption of electrical and water utilities.

PhilEnergy is investing close to P1 billion for the construction of DCS plants that will serve the needs of Ayala Center redevelopment in Makati and Alabang Town Center.

The company plans other DCS projects in Cebu, Davao, Cagayan de Oro and Quezon City and tap into large domestic and even regional market of facilities that require energy-saving solutions.

“We are very excited about this new partnership with Mitsubishi Corp. Being able to manage the occupancy costs for the tenants in our portfolio of leasing properties is going to be very critical to the continued success of Ayala Land in this very competitive market environment,” said Ayala Land president Antonino Aquino.

“We are also fully committed to raising the bar for sustainability in our facilities, and even the country as a whole, and PhilEnergy will be a vital component of our strategy moving forward.” Jenniffer B. Austria

Investors eye stake in San Miguel power unit

Conglomerate in talks with prospective buyers
Philippine Daily Inquirer
12:41 am | Friday, November 25th, 2011

Conglomerate San Miguel Corp. on Thursday said it was in talks with investors interested in acquiring a portion of its power unit after it deferred a planned $850-million public offering due to market volatility.
The food-to-power firm told the stock exchange there were “ongoing talks with third parties who have expressed interest to acquire an equity stake in SMC Global Power Holdings Corp.”
The company confirmed a report by Bloomberg quoting group president Ramon Ang who said San Miguel was “in talks with several” parties, which he did not name.
SMC Global Power had earlier deferred a planned IPO worth up to P36.9 billion, which would have been the country’s biggest IPO. The sale was meant to fund more infrastructure and energy projects.
San Miguel was the country’s dominant food and drinks firm for decades before an aggressive expansion saw it become the biggest power player. It also has interests in oil refiner Petron Corp, power distributor Manila Electric Co., infrastructure, coal mining and telecommunications.
The group accounts for nearly 30 percent of installed capacity on the main Luzon island and has plans to add 3,000 MW of new capacity in the next 10 years via greenfield power projects requiring investments of about 90.4 billion pesos.
Shares of San Miguel slid 0.9 percent on Thursday by mid-session as the main stock index lost 1 percent.—Reuters