Sunday, September 30, 2012

NGCP upgrades energy management system in Visayas

business mirror


THE National Grid Corp. of the Philippines (NGCP), the country’s sole power-lines concessionaire, said on Friday it has completed the upgrade of its Energy Management System (EMS) in the Visayas this year.
The NGCP said the completion of the EMS is in line with its efforts to build a stronger transmission for a stronger nation. It said the upgrade of system operations facilities in the Visayas is part of a nationwide project that improved the capability of and integrated NGCP’s National Control Center with its Regional Control Centers.
The NGCP said the project adopted the use of OPEN 3000, a state-of-the-art operating system that facilitates the effective monitoring and control to ensure the balance of power supply and demand.
The agency said the upgrade was necessary to replace obsolete hardware and overloaded system software in order to increase system reliability and performance, provide complete system data by accommodating new stations, and integrate the electricity market functions into the EMS.
The NGCP said the EMS integrates applications that are needed to manage the power transmission network.
A major component of the EMS, the NGCP said, is its Supervisory Control and Data Acquisition (Scada) system, which is a collection of equipment and software that facilitates control of remote devices, acquisition of real time data on power demand, capacity of connected power plants and other power-system parameters.
The NGCP said the Scada/EMS upgrade in Luzon and the Visayas has a combined project cost of P189.4 million. The upgrade in Mindanao, where the regional control center has been moved from Iligan to Cagayan de Oro, cost P126.5 million.
The NGCP earlier said  it continues to strengthen the power transmission network in Leyte, which is aimed to meet the increasing power demand and improve system reliability. Among its ongoing projects this year is the Visayas Substation Expansion I Project, NGCP said the expansion includes the installation of a new 100-megavolt ampere  transformer at Ormoc substation in Leyte.
The NGCP said the transformer is set to be energized in December 2012.
It said the projects in the area that are in their preconstruction stage include the Visayas Substation Reliability Project I, which involves the installation of a new transformer at Maasin substation in Southern Leyte.
The NGCP said the Ormoc-Babatngon 138-kiloVolt (kV) transmission line project involves the construction of a second circuit transmission line and its associated high-voltage equipment at the Ormoc and Babatngon substations.
The NGCP said another project, the Ormoc-Maasin 138-kV transmission line project, covers the stringing of a second circuit, and installation of related equipment at the Ormoc and Maasin substations.
The agency said it also implements the rehabilitation of its 69-kV transmission lines in the area.
Since last year, the NGCP said a total of 617 wooden transmission poles have been replaced with steel poles.
The rehabilitation, the NGCP said, is expected to increase line reliability and significantly lessen the probability of line outages, especially during extreme weather conditions.
To ensure continuous power services, the NGCP has appealed for public support in the prevention of pilferage, sabotage, grass fires and kite flying near transmission and distribution lines.
The NGCP is a privately owned corporation in charge of operating, maintaining, and developing the country’s power grid. It transmits high-voltage electricity through “power superhighways” that include the interconnected system of transmission lines and towers, substations and related assets.    source

Thursday, September 27, 2012

Thai power firm eyes tieup with Meralco

By Riza T. Olchondra
Philippine Daily Inquirer
Electricity Generating Public Co. Ltd. (EGCO) of Thailand is keen on partnering with Manila Electric Co. (Meralco) for its power plant expansion in Quezon province while looking for other opportunities, including plant acquisitions, a company official said.
EGCO wants Meralco as an offtaker and partner for the 500-megawatt (MW) second phase of its coal-fired power plant in Mauban, Quezon, Quezon Power (Philippines) Ltd. Co. managing director Frank Thiel told reporters.
Quezon Power’s existing facility includes a 460-MW coal-fired generating plant and a 31-kilometer transmission line.
“Meralco has been a great partner of Quezon (Power) and offtaker for the first unit,” Thiel said.
Aware that Meralco has other suitors for offtake deals, Thiel said Quezon Power’s draw was that it had permits, community support, land, a transmission line and a plan to synergize operations of the first and the planned second unit to bring costs down.
The construction of Quezon Power’s second unit may take about three years. Financing may come mostly from local banks but the power firm is also looking at overseas sources for complementary and competitive deals, Thiel said.
Thiel said EGCO intended to expand its presence in the Philippines, whether in traditional or renewable power generation, after having taken a controlling stake in Quezon Power.    source

BDO Capital arranges P10-billion loan for A. Brown coal project

By Donnabelle L. Gatdula (The Philippine Star) Updated September 27, 2012 12:00 AM

MANILA, Philippines - BDO Capital & Investment Corp., the investment house of top lender Banco de Oro Unibank, is arranging a P10-billion financing package for A. Brown Co. Inc.’s coal power project in Iloilo.
BDO Capital president Eduardo Francisco told The STAR that they are currently firming up the loan.
“We are working on it,” he said.
He said the 135-megawatt power generation project is a “sound project,” being backed by reputable names in the industry.
Francisco said they have also looked at the details of the project, including the off-taker agreement.
“We have seen the agreement signed by the buyers of the power from the plant and we believe the project would run smoothly,” he said.
The BDO Capital official said they expect to close the financing deal soon.
“It would be soon. Before the end of the year,” he said.
Ayala-owned AC Energy and A. Brown earlier reported that they will jointly build the circulating fluidized bed (CFB) thermal plant in the province of Iloilo at an estimated cost of P12.5 billion.
Specifically, the project will be undertaken by A. Brown subsidiaries Palm Thermal Consolidated Holdings Corp., Palm Concepcion Power Corp. (PCPC) and Panay Consolidated Land Holdings Corp.
The construction of the project is expected to start in the last quarter of this year, with target completion in 2015 when an anticipated tight power supply situation in the Visayas grid occurs.
“The corporation has done all the preliminary work and investments over the past two years, and the project is already in an advanced stage of pre-development.The engineering plans are ready and important regulatory approvals have been secured,” PCPC president Roel Castro earlier said.
Aside from power generation, A. Brown is known for being a premier developer of quality real estate in Northern Mindanao since 1995. It is also engaged in a huge palm plantation project in Mindanao.    source

Wednesday, September 26, 2012

Coal Asia firms up supply deals

Business World Online 
Posted on September 26, 2012 09:56:21 PM

COAL ASIA Holdings, Inc., which is targeting to be the fourth firm to list on the stock exchange this year, aims to supply coal to big-name firms in the next few years, the company’s financial adviser said yesterday.

His statement could not be verified immediately with the companies he cited.
Speaking to reporters after an investors’ briefing at Discovery Suites in Ortigas Center, Pasig City yesterday, Vicente L. Araña, Coal Asia’s financial adviser, said the company has been in talks with Global Business Power Corp., Aboitiz Power Corp., Manila Electric Co., TeaM Energy Corp., the Alcantara Group, FDC Utilities, Inc., DMCI Holdings, Inc., Ayala Corp., and San Miguel Corp. for the potential coal supply of these firms’ plants, while for cement, the company has been in discussions with Holcim Philippines, Inc., Cemex Philippines, and Lafarge Republic, Inc.
“Coal Asia believes that it is at the right place and the right time for its coal mine operation given the energy crisis in Mindanao, and owing to the growing demand for fuel to meet this region’s [sic] economic expansion and the resulting buildup of new generating power plants such as coal-fired units,” the company said in a statement yesterday.
Asked for a timetable for these deals, Mr. Araña said: “Within the year, ideally. At least one, hopefully.”
“We don’t know exactly what we will close; this still has to be negotiated,” Mr. Araña told reporters.
Coal Asia, an investment holding firm primarily engaged in coal and energy-related businesses, is the parent of Titan Mining and Energy Corp., which in turn owns coal operating contract (COC) 159 in Davao Oriental, as well as COCs 166 and 167 in Zamboanga Sibugay, according to a regulatory filing last July.
It claims to hold the country’s second-largest proven coal reserves with a combined 123 million metric tons (MMT) consisting of 71.1 MMT in Davao Oriental and 51.1 MMT in Zamboanga Sibugay, where commercial operations may commence in 2014 and 2015, respectively.
In addition to possible supply deals, Coal Asia has also received proposals from two independent power producers for the development of a mine-mouth power plant project in Davao Oriental, and from established mine operators for the joint development of the Zamboanga Sibugay project, Mr. Araña said.
The company, however, was not yet in the position to provide details on these proposals, he added.
Last Sept. 14, the Philippine Stock Exchange approved Coal Asia’s initial public offering, which is set to take place Oct. 9-15, with listing on the stock exchange’s first board targeted for Oct. 23.
Coal Asia said it aims to raise P726,868,750 in net proceeds from an offer of 800 million common shares priced at P1 apiece, equivalent to 20% of total issued and outstanding capital stock.
Of these proceeds, P537 million will go to the company’s Davao Oriental project, while P63 million will be allotted for those in Zamboanga Sibugay. The balance of P126.869 million will be earmarked for working capital purposes, the company said in a regulatory filing.
The funds will support the company’s sub-surface exploration, construction of mine and camp site structures, port and stockyard facilities, supplemental infrastructure for power and water, treatment plants, and an in-house laboratory, among others.
Brokerage Abacus Capital and Investment Corp. will serve as issue manager and underwriter for the firm’s planned public offering, the document read.
Coal Asia will be the fourth firm to go public this year following conglomerate GT Capital Holdings, Inc., which listed in April, as well as Gotianun-led East West Banking Corp. and feed supplier Calata Corp., which listed in May.
For the first half, Coal Asia reported a net income of P2.03 million, as well as P13.41 million in sales and cost of sales totaling P6.73 million. -- F. J. G. de la Fuente    source

Quezon Power Eyeing Meralco Supply

Manila Bulletin
September 26, 2012, 6:56pm
MANILA, Philippines — To viably underpin the planned 500-megawatt expansion of its coal-fired power plant in Mauban, Quezon Power Philippines Ltd. Co. has been tugging its way into advancing negotiations with power utility giant Manila Electric Company (Meralco) for an off-take or power supply agreement (PSA) that will cover the bulk of its additional capacity.
This was disclosed to reporters by Quezon Power managing director Frank Thiel in a press briefing following the conclusion of the Project Finance Forum convened by the BDO Group last Tuesday at the Shangri-La Hotel in Makati.
In line with its bid to corner Meralco’s nod on its targeted off-take deal, the company executive has indicated that they are willing to back that up with a partnership arrangement in the project’s corporate vehicle.
He indicated that since Meralco historically sounded off intent to gain majority ownership in power projects in which it would be involved in, Thiel noted that they are willing to offer that as a “leverage” to the utility firm.
“Meralco is our primary target. They are the off-taker of our QPPL-1 and it stands to reason that we would want them to be the off-taker also for the number 2 plant… so we’re concentrated on that right now,” he stressed.
Acknowledging the fact that all power developers in the Luzon grid are also ardently courting Meralco for off-take agreements, the Quezon Power executive noted that they can offer in the negotiations table some distinct advantages that can propel them ahead in the competition.
In particular, he noted that the facility’s expansion has already been granted an environmental compliance certificate (ECC) by the Department of Environment and Natural Resources (DENR) and that the plant’s existence in Mauban is already well-received by its host community.
Additionally, he stressed that since the expansion will already share some of the facilities of the first 460MW unit, they would be able to offer competitive rates to Meralco.
“We have the ECC already, we have the land, we have the transmission line and the sharing of facilities with the first unit will give us very competitive rates in terms of power prices,” Thiel has reiterated.
Beyond the Mauban plant expansion, Quezon Power has also been scouring for other opportunities in the power sector – and this could range from acquisitions to development of greenfield facilities, such as liquefied natural gas-fed power plant or even those that will utilize renewable energy resources.
“We’re also in the hunt for potential acquisitions,” he said, but there is nothing definite yet as to which assets they will be keen on considering.
With the changeover in Quezon Power’s equity ownership – shifting to Thai firm EGCO – it has been noted that their desire for operational expansion in the Philippines has just been turning more aggressive.    source

Agus 3 proponent seeks Congress OK of $500-M proj

By Neil Jerome C. Morales (The Philippine Star) Updated September 26, 2012 12:00 AM

MANILA, Philippines - Agus 3 Hydropower Corp., the proponent behind the Agus 3 hydropower plant, is seeking congressional approval to pursue the $500-million project in Mindanao.
The 225-megawatt (MW) power plant will increase available output in electricity-starved Mindanao, the company said in a statement.
In a letter to the Joint Congressional Power Commission (JCPC) dated Sept. 10, Agus 3 said it is applying for a service contract in line with the Renewable Energy Act of 2008.
“The development of the Agus 3 hydropower plant can proceed independently of the privatization of the Agus complex...and in furtherance of the objective of the Renewable Energy Law for the acceleration of the exploration and development of renewable energy resources for power generation,” the company said.
“The immediate implementation of Agus 3 will empower the host local government units and their constituencies by way of financial assistance to be derived from their share in the revenues of the Agus 3 hydropower plant,” it added.
Agus 3 said it has secured relevant government clearances, including the certificate of non-overlap from the National Commission on Indigenous Peoples.
In January, Agus 3 applied for a service contract to the Department of Energy (DOE).
However, DOE Secretary Jose Rene Almendras referred the matter to the Power Sector Assets and Liabilities Management Corp. for study of the current situation of the Agus complex.
The DOE, which also said that the awarding of hydropower resources in the area is not technically feasible due to the cascading nature of the resource, also asked the JCPC for policy directions.
Under Republic Act 9136 or the Electric Power Industry Reform Act of 2001, Agus complex should be privatized 10 years after the passage of the law.
The 10-year moratorium ended last June, but DOE already recommended not to sell the hydropower facilities prior to the deadline.
The sale of the hydropower complex has faced several oppositions, like concerns from the Alliance of Electric Service Companies in Mindanao that the low-cost power provided by the power complex could be jacked up when privatized.
Agus 3 is 80 percent held by Tranzen Group of Salvador Zamora II that also owns the country’s largest miner Nickel Asia Corp. The remaining 20 percent stake is owned by Lanao Hydropower Development Corp.
Agus 3 said it will fund the construction of the 225-MW primarily through bank financing.
The company has already secured a credit line from the Development Bank of China.    source

Tuesday, September 25, 2012

Agus 3 hydropower plant not part of Agus-Pulangi privatization

business mirror


THE Agus 3 Hydropower Corp. on Wednesday said the development of the 225-megawatt (MW) Agus 3 hydroelectric power plant is not covered by the privatization policy of the National Power Corp. (Napocor) generating assets.
In a letter to the Joint Congressional Power Commission (JCPC), Agus 3 chairman and chief executive Salvador Zamora II, said the use of the water resource of Lake Lanao and Agus River is regulated in accordance with a water protocol in the respective water permits of the existing Agus hydroelectric power plants.
Agus 3 Hydropower Corp. is a joint venture between Tranzen Group Inc. of Zamora and Lanao Hydropower Development Corp. Tranzen and Lanao own 80 percent and 20 percent of the project, respectively.
“The development of the Agus 3 hydropower plant can proceed independently of the privatization of the Agus hydropower complex with the reforms in the electric power industry and in relation of the Renewable Energy Act of 2008 for acceleration of the exploration and development of renewable energy resource for power generation,” Zamora said.
He said he believes that Agus 3 Hydropower Corp. is entitled to the registration of and renewable energy service contract for the Agus 3 hydropower plant.  
Zamora added the immediate implementation of the Agus 3 hydropower will empower the host local government units and their constituencies by way of financial assistance to be derived from their share in the revenues of Agus 3 hydropower plant.
He said the implementation of the Agus 3 hydropower plant will optimize the use of the water of Lake Lanao and Agus River for power generation consistent with the objectives of the Water Code of the Philippines.
Zamora added that the immediate operation of the Agus 3 hydropower plant will reduce importation of fossil fuel and save the country from substantial foreign exchange expenses.
Zamora added the immediate operation of the Agus 3 hydropower plant will contribute to the reduction of carbon and other greenhouse gas emissions to the atmosphere and mitigating the climate change impact of these emissions.
He said the power plant will also displace power generated from using bunker and other fossil fuels, adding that Energy Secretary Jose Rene Almendras advised them that their application was referred to the Power Sector Assets and Liabilities Management Corp. (PSALM) for study of the current situation of the Agus hydropower complex.
Almendras said there is a need to pursue the privatization plan of the Agus hydropower complex to guarantee a level playing field in the industry. The individual awarding of hydropower resources in the area of the Agus complex is not technically feasible due to the cascading nature and hydrologic interdependence of the resource.
To date, the government controls only the six hydro power plants in the Agus complex with a capacity of more than 700 MW. The 80-MW Agus 1 in Marawi City, 180-MW Agus 2 in Lanao del Sur, 158.1-MW Agus 4 in Lanao del Norte, while the 55-MW Agus 5, 200-MW Agus 6 and 54-MW Agus 7 are located in Iligan City.
Almendras earlier said Napocor will need another P2 billion to P3 billion to rehabilitate the power plant to come up with either additional capacity or to optimize the existing generating capacity of the 982-megawatt Agus-Pulangi hydropower complex in Mindanao.
“We need to rehabilitate and fix up what we can in the [Agus-Pulangi] power plant. We’ve even asked Napocor to find a way to bring back the Agus hydropower complex to the 700-MW capacity that it once was,” Almendras said.   source

Coal Asia to buy stake in VenturOil

Tuesday, September 25, 2012

COAL Asia Holdings Inc., holder of the country’s second largest coal reserves, recently struck a deal to purchase a stake in VenturOil, a company that expects to start producing up to 11,440 bbl of oil per day by 2013 which translates to a gross cash flows of over $315 million.
Coal Asia's entry into the very lucrative oil and gas business will be done through its affiliate Colossal Petroleum Corp.
Coal Asia is eyeing to acquire a stake in VenturOil's Service Contract 6 for both Cadlao and Bonita oil fields where VenturOil holds a 20 percent undivided interest and 12.88 percent interest, respectively.
An independent valuation of Venturoil's Service Contract 6 has placed the value at between US$96m - US$190m. The deal will be subject to the approval of the Energy department and the parties will have 90 days from the signing of an agreement to work out the salient terms of the buy-in.
The Cadlao field, located 40 kilometers off the northwest coast of Palawan island, was developed in 1981 for its rich oil deposits producing 11 million barrels of oil from two wells, but production ceased in 1991 due to high operating costs and low oil prices.
Reviving the potential of Cadlao, the Cadlao Redevelopment Project was carried out after independent reports certified remaining oil reserves at the site of around six million barrels.
VenturOil has already partnered with Australian oil firms Blade Petroleum and Raisama Energy for the completion of the Cadlao project. Under the terms of the partnership agreement, VenturOil’s 20 percent stake in the partnership is fully funded with Raisama Energy covering the entire share of Venturoil in the development cost of the Cadlao project.
Established in October 2006, VenturOil is an oil production and exploration company in the Philippines investing in fast cash flow assets and developing them into profitable assets in the shortest possible time at the most cost effective means possible.
Coal Asia remains to be a serious player in the energy sector as it targets more contracts to level up its game with other major players in the industry. It recently obtained both the Securities and Exchange Commission and Philippine Stock Exchange's approval for its P800-million initial public offering.
Published in the Sun.Star Davao newspaper on September 25, 2012.    source

Meralco cautions gov’t on feed-in tariff plan

Philippine Daily Inquirer
Manila Electric Co., the country’s biggest power distributor, has cautioned the government regarding the imposition of the feed-in-tariff allowance (FIT-ALL) on consumers as this might have a significant impact on electricity bills.
In a commentary sent by Meralco to the Energy Regulatory Commission, the distribution utility pointed out, in particular, the proposed guidelines for the collection and administration of the FIT-ALL, a universal levy to be collected from all power consumers. The FIT-ALL approximates the total payments required to be made to all renewable energy developers that will be entitled to the feed-in-tariff rates.
However, apart from the FIT-ALL itself, consumers will also have to pay for the administrative costs that will be incurred by the fund administrator—or the entity that will be tasked to handle all the remitted FIT-ALL by the distribution utilities and electric cooperatives. Thus, a prudent system must be in place to ensure that consumers will not be burdened further.
“We recommend that the rate recovery mechanism be simple and easy to implement, will not require over- and under­recovery adjustments, will be revenue neutral to the distribution utilities or electric cooperatives and will not have a significant impact to the generation charge of the consumers,” said Lawrence S. Fernandez, assistant vice president and head of utility economics of Meralco.
“We firmly believe that any additional imposition, just like any other cost throughout the power supply chain (for example, distribution, transmission, ancillary charges and taxes), should be carefully and continuously scrutinized against the objective of providing adequate, reliable, efficient and cost-effective electric service to all end-users, households and business alike,” he added.
Meralco, according to Fernandez, was also seeking the immediate resolution of the assignment of the fund administrator, which will have a major role in the implementation of the feed-in-tariff system.
The National Renewable Energy Board (NREB) has formally endorsed the state-run National Transmission Corp. (Transco) to become the administrator of the charges that will be collected from all power consumers for the use of renewable energy.
NREB Chairman Pedro Maniego Jr. earlier said that the letter dated September 11 reiterated their position that Transco should be the administrator of the FIT-ALL in compliance with the request of the Energy Regulatory Commission to confirm in writing such proposal.—Amy R. Remo     source

ERC asked to simplify feed-in tariff collection

Manila Standard Today
By Anna Leah G. Estrada    Posted on September 25, 2012   12:01am
Power distributor Manila Electric Co. asked the Energy Regulatory Commission to simplify the system of collecting the feed-in tariff of electricity produced by renewable energy companies.
A Meralco official said the ERC should exercise caution in implementing the recovery rate mechanism between distribution companies and the feed-in tariff allowance administrator, as it could push up power rates.
“We would like to urge caution on the possible effect of this arrangement to the consumers’ electricity bills,” Meralco  assistant vice president and head of utility economics Lawrence Fernandez said in a letter to ERC executive director Francis Saturnino Juan dated Sept. 12.
The cost of power produced by renewable energy companies such as solar energy or wind-power developers will include FIT-allowance, or the uniform peso per kilowatt-hour charge that will be collected and placed in a fund managed by an administrator. The ERC has not come out with its computation on the FIT-All.
“We recommend that the rate recovery mechanism be simple and easy to implement, will not require over and underrecovery adjustments, will be revenue neutral to the DUs/ECs [distribution utilities and electric cooperatives] and will not have a significant impact to the generation charge of the consumers,” Fernandez said.    source

Monday, September 24, 2012

Neda wants Agus power plant privatized

business mirror


CAGAYAN DE ORO CITY—The National Economic Development Authority (Neda) has recommended the full privatization of the Agus Hydro-Electric Power Plants (HEPPs) to address the power crisis in Mindanao.
The recommendation was one of nine issues and concerns on the Mindanao power situation submitted to President Benigno Simeon C. Aquino III by Neda, according to Ozamiz City Mayor Nova Princess E. Parojinog-Echavez, chair of the Infracom of the Regional Development Council in Northern Mindanao (RDC-10).
“The Neda board has recommended for [the] full privatization [of the Agus HEPPs] to be done on a per power plant basis or split into three subcomplexes to address the concern on having dominant players,” said Jaime H. Pacampara, chief economic development specialist of Neda-10 and Infracom coordinator of RDC-10.
The issue of privatization of the Agus-Pulangi power complexes, located in Lanao del Sur and Bukidnon provinces, is a very contentious and divisive issue that came to the fore during the power crisis in Mindanao in 2009-2010.
The Agus hydropower plant in Lanao del Sur has a total generating capacity of 700 megaWatts (mW) while the Bukidnon-based Pulangi hydropower plant has a generating capacity of 255 mW for a combined total generating capacity of 955 mW.
Both plants supply about 55 percent of the power needs of Mindanao.
But given their antiquated infrastructure, the combined power  generation of the two hydropower complexes is currently only about half or even less than their power-generating potential, with Napocor claiming that these plants are now operating at a capacity of only from 200 mW to 300 mW.
Agus’s first unit was constructed in 1953 while the newest one started operation in 1992. Pulangi began operations in 1985.
The power plants’ privatization is in accordance with the Electric Power Industry Reform Act (Epira).
Section 47 of Epira states that 10 years from its passage, power assets may already be sold to private investors.  Epira’s 10th year was last June 2011.
But despite this law, many are vehemently against the privatization of the Agus-Pulangi hydropower complexes citing negative impact on electricity prices in Mindanao. Privatization opponents also raised the specter of monopoly after these plants’ privatization.
Instead of privatizing these assets, privatization opponents urged the Aquino administration to rehabilitate them.
Mindanawon Sen. Aquilino “Koko” Pimentel III even urged for an amendment if not outright scrapping of the Epira since it has not benefited the people since its approval.
Pimentel said the Mindanao power crisis is artificially designed to make Mindanawons capitulate to the national government’s desire to privatize the Agus-Pulangi hydropower complexes.
But with Neda’s recommendation to Malacanang, Mindanawons fear the worst, especially since President Aquino has repeatedly called for understanding on why he is for privatization of these power plants.
Aside from privatization of the Agus-Pulangi plants, the Neda also recommended to Aquino to compel the National Power Corp.-Power Sector Assets and Liabilities Management Corp. to purchase power directly from the private producers to come up with a blended rate with hydropower.
However, Neda said instead of reverting back to a monopoly, the distribution utilities should enter into bilateral contracts with generation companies subject to the limits prescribed under Rule 11, Section 5 of the Epira.
It also recommended the privatization and transfer of power barges provided that the private sector agrees to rehabilitate and transfer the PBs and the consumers agree on higher power rates.
Neda also recommended the Leyte-Mindanao Interconnection Project which many are opposing for fear that high power cost in Luzon will be transferred to the Visayas and Mindanao.    source

Customers help Davao Light avoid rotating brownouts

business mirror


CAGAYAN DE ORO CITY—Thanks to its large institutional customers which use their own power generators during power curtailments, Davao Light and Power Co. (DLP) has so far avoided implementing rotational service interruptions within its franchise.
The National Grid Corp. of the Philippines (NGCP) has curtailed power supply to Mindanao for as high as 460 megawatts (MW) on August 5. On September 21, the power curtailment for the Mindanao Grid was only 130 MW.
But with the onset of El Niño and the critical power supply situation in Mindanao, DLP believes the NGCP’s power curtailment to the Mindanao grid will go up.
However, DLP’s current setup with its large customers has enabled the company to avoid implementing brownouts. The setup involves institutional customers such as malls to operate their own power generators instead of getting power from the grid. This set-up also enables other customers without generating capacity to utilize the power that would have been consumed by these large customers.
At the peak of the recent power supply shortage in August, the Victoria Plaza, Gaisano JP Laurel and NCCC Ma-a malls, along with Craft Haven International Services Inc. (formerly Unifrutti), C. Alcantara & Sons Plywood Division, Gaisano South Ilustre, Coca-Cola and Legaspi Oil used their own generators.
Two years ago, during the power crisis in 2010, the first five of the above-mentioned companies and the Lapanday Foods Corp., Tadeco, New Asia Oil Inc., Western Feedmill, Forever Richsons Trading, Dole Philippines-Stanfilco, and Waterfront Insular Hotel Davao also generated their own power supply.  At the height of this latest power shortage, some local dailies reported that other areas in Mindanao have experienced 30 minutes to two hours of rotating outages.
“To make up for this lack of power supply, Davao Light is optimizing the use of its contracted energy supply from Hedcor Inc. Sibulan [42 MW] and Talomo [5 MW] hydro-electric power plants, and the oil-fired power barges of Therma Marine Inc. (30 MW). The electric utility’s Bajada Power Plant (40 MW), which is on hot standby, is being operated if in case the power supply from these contracts is not enough,” DLP said in a statement.
The NGCP said that as of Monday, September  24, Mindanao’s system capacity was at 1,149 MW while its system peak was at 1,204 MW resulting to a -55 MW reserve.
Mindanao’s power mix is composed of coal (18.3 percent), diesel (17.29 percent), geothermal (7.94 percent) and hydro (56.47 percent).    source