Published January 25, 2017, 10:00 PM By Myrna M. Velasco
The power group of conglomerate San Miguel Corporation (SMC) is offering to government the initial 150 megawatts capacity of its 600MW Limay power plant in Bataan to augment supply during the Malampaya shutdown – and at a cheaper rate that could match capacity produced from coal-fired generation facilities.
SMC President Ramon S. Ang told reporters that the 150-megawatt first block of its Limay power facility is utilizing diesel as commissioning fuel, but it intends to supply the grid during the 20-day downtime of the Malampaya gas production facility on the price of coal, which is currently at the level of P2.80 per kilowatt hour.
By the Department of Energy’s (DOE) estimate, diesel-fired power facilities would likely be supplying their capacities to the grid at P6.00 to P8.00 per kWh, but San Miguel Global Power Holdings Corporation, dangles a more competitive option on that anticipated tight supply period.
“Our unit 1 at Limay is running on diesel… that can help during the Malampaya shutdown. It can produce 150MW, but the cost with its diesel commissioning fuel is more expensive. But what we’re saying is, even if we are paid at the price of coal, that will be okay with us,” Ang said.
He noted they are ready to feed their capacity to the grid on the request of Energy Secretary Alfonso G. Cusi who is scouring for solutions “to ensure that power supply during Malampaya shutdown will not suffer shortages.”
Ang said their power business group is currently in discussion with relevant government agencies on this offer – primarily the DOE and the Energy Regulatory Commission (ERC) on cost recovery mechanisms for the commissioning fuel.
The 600-MW Limay plant of San Miguel has been designed as a coal plant utilizing circulating fluidized bed (CFB) technology – and it will have four blocks of 150MW capacity each. The first unit is expected to reach full commercial commissioning May this year; while the second block around August; and the third and fourth blocks next year.
“There are discussions with DOE and ERC regarding Limay. I think what the government wants is cheaper rates. It is our power group that has been in discussion with them,” Ang stressed.
The Malampaya shutdown will run from January 28 to February 16 this year; but Ang said they could also help with buffer supply in case of technical glitches post-downtime of the gas facility, hence, their supply offer would be good for 30 days.
Proposal of staggered payments to diesel-fed power facilities is also a “welcome option” for the San Miguel power group.