SMC yet to acquire ECC for coal project

By Bong S. Sarmiento

Monday, May 2, 2011

GENERAL SANTOS CITY -- San Miguel Corp. has yet to conduct a public hearing for its planned coal-fired power plant in this city, which is one of the requirements to acquire the environmental compliance certificate (ECC) needed to start the project, the regional Environmental Management Bureau said Monday.

Wilson Trajico, EMB-12 division chief for environmental impact and monitoring, said San Miguel "is not yet seeking an ECC" for its planned $300 million coal-fired power in this city.

"The regional office would know if there's an ECC application. So far, we have not been instructed by our main office to help in the conduct of a scoping or public study, which would imply the company has applied," he said.

Trajico said applications for an ECC are coursed through the national office but the ones normally conducting the public hearing are local personnel.

The official made the clarification after a report said that San Miguel is planning to start the construction of its coal-fired power plant here within the year.

San Miguel president Ramon S. Ang last year announced the company's plan to venture in a 300-megawatt coal-fired power plant in Central Mindanao.

Efforts to locate local officials of San Miguel for comments proved futile.

Already, the diversified giant company has acquired the tenements of three coal mining companies namely Daguma Agro Minerals Inc., Bonanza Energy Resources Inc. and Sultan Energy Philippines Corp.

Studies show Daguma Mountain Range has a coal reserve of 426 million metric tons. Initial exploration and drilling have blocked 55 million metric tons of minable reserves in 526 hectares of the mountain range in Barangay Ned in Lake Sebu, South Cotabato.

Trajico said the three coal mining firms have already been given ECCs.

Fr. Romeo Q. Catedral, social action director of the Diocese of Marbel, has criticized the bid to extract coal reserves in Lake Sebu town and plans of San Miguel to construct a coal-fired power plant here.

"Ned is a watershed area, mining the coal there would pose not only environmental risks but will also threaten food security," the priest said.

On the planned coal-fired power plant of San Miguel, Catedral has called on the City Council to block the venture for the apparent danger it poses to the marine-rich Sarangani Bay.

Ned is a government-designated relocation site. Its near-to-surface location is best exploited through open-pit mining.

South Cotabato Representative Daisy Avance P. Fuentes earlier said that coal mining in Ned would be affected by the provincial environment code that bans open-pit mining method.

Fuentes signed the controversial environment code before her three-term governorship ended last June, a move that also poses a stumbling block to the $5.9-billion Tampakan copper-gold project of Sagittarius Mines, Inc.

The Tampakan project could be the largest single foreign direct investment in the country should it be proceeding in 2016. (BSS)

Published in the Sun.Star Davao newspaper on May 03, 2011.

DMCI unit begins work on new Calaca coal plant

Manila Standard Today

by Alena Mae S. Flores

Sem-Calaca Power Corp., a unit of the DMCI group, will begin work on the expansion of the 600-megawatt Calaca coal-fired power plant this year, a company official said Friday.

Sem-Calaca director Nestor Dadivas told reporters the company would construct two units of 150-MW circulating fluidized bed power plant for the first phase of the expansion.

“The 2 X 150-MW CFB coal power plant is the first phase of the total 4 x 150 MW. We hope to break ground within the year,” Dadivas, concurrent president of DMCI Power Corp., said. The expansion project will bring the total capacity of the Calaca power complex to 1,200 MW.

Sem-Calaca, a company established by Semirara Mining Corp., a unit of DMCI Holdings Inc., operates the Calaca coal facility.

Dadivas did not say how much the company would spend for the construction of the coal facility. A coal-fired power plant costs around $2 million to $2.5 million per MW to construct on the average.

Dadivas earlier said the company was studying the power demand and supply situation in Luzon in order to make an investment decision for the planned expansion.

The current Calaca facility, which consists of two 300-MW generating units, is primarily designed to run as a base-load plant and utilize local coal from Semirara.

Honeyman: Electricity

Sunstar Bacolod

By Neil Honeyman

AN INDEPENDENT VIEW

ALL Ceneco consumers have suffered from the 18% increase in the price of electricity implemented last month. Many will have difficulty in meeting the additional cost and, for some, there will be hardship.

In its Sun.Star Bacolod advertisement published on Thursday 28 April, Ceneco reminded us that the price hike of P 1.27 per KWH was announced at a press conference on 8 December 2010. In fact, the press conference stated that the hike would be in two phases, P 0.36 per KWH on 26 December 2010 (which did not materialize) and P 0.91 per KWH in March 2011.

But is a press conference, held nearly five months previously, the best way to communicate bad news to Ceneco’s member consumers? We do not think so.

Ceneco has 143,000 account holders. The total readership of Sun Star Bacolod and the other local newspapers comprises approximately 10% of Ceneco’s accounts. 90% will not have been aware of the press conference. This is one of least efficient methods of communicating with Ceneco’s member consumers.

The way for Ceneco to tell us the bad news is surely to place a note with the previous month’s bill informing us of impending price hikes. We would also appreciate a cogent and quantified explanation as to how the hike is justified. The somewhat sententious ‘So the Public May Know’ missive which we received with our April bill was not particularly helpful in this regard.

Also at the 8 December 2010 press conference, Ceneco announced the arrival in Bacolod on 14 December of Energy Secretary Jose Rene D. Almendras who would be launching the Wholesale Electricity Spot Market (WESM) for the Visayas which started operations on 26 December 2010. WESM, as Ceneco President Gasambelo said at the 8 December 2010 press conference, would enable distribution utilities and cooperatives to purchase electricity from power-generation companies at competitive prices.

According to the WESM Website, ‘its role in the country’s overall energy reform is to create a fair, transparent and reliable trading environment that will attract investments and encourage healthy competition leading to the ultimate objective of cheaper electricity for all consumers’.

Ceneco’s support for WESM has been lukewarm. The co-operative has persisted in negotiating bilateral agreements which are not transparent and are not demonstrably more advantageous than WESM contracts where lower prices may be obtained due to the ability of the co-operative to negotiate on-line with many power generation companies simultaneously. In last Thursday’s advertisement, Ceneco confirmed its muted attitude towards WESM when it says ‘it will continue learning and exploring the lower cost opportunities that could be available from WESM’. Well WESM Visayas is now in its fifth month of operation and does many trades each day between buyers and sellers of electricity.

We also believe that Ceneco, as a public sector utility, should be able to re-negotiate or even rescind bilateral contracts if these contracts have become contrary to the public interest. We were concerned in 2007 when Ceneco signed a bilateral contract with KEPCO Salcon. The reason for our concern at that time was that the price Ceneco would pay for electricity produced from the coal-fired plant would be dependent on the price of coal. If coal prices increased, then Ceneco would pay more for the electricity under the terms of this contract. Therefore, it is the Ceneco consumers, not KEPCO, who shoulders the risks associated with the possibility of coal price hikes.

We are pleased that several local government units in the Ceneco area are seeking help from the Electricity Regulatory Commission (ERC) in judging the fairness of Ceneco’s contracts. This is a start. But since the ERC has already approved these contracts, it is difficult to expect it to change its mind. We would also look to the Congressmen of Ceneco’s area of responsibility to observe whether they consider that their constituents are being treated fairly.

PNoy’s government reiterated many times that it has a strategy of having a high growth rate for the Philippines. Under current circumstances, we can only obtain a reasonable growth rate if we are able to consume more energy, particularly more electricity. Empirical studies have shown that a 6% economic growth rate requires a 10% increase in electricity consumption. The P 1.27 per KWH price hike in the Ceneco region will have the effect of depressing the demand and truncating our much needed economic growth.

Energy Secretary Almendras needs to understand what is happening on his watch and to decide whether his energy policy is compatible with the government’s growth strategy.

Under PNoy’s governance, too many decisions are made without properly understanding their full ramifications.

And Ceneco should communicate more effectively with its member consumers.

* * *

Please tell me that the discomfiting brown-out last Friday evening was not due to the British royal wedding held at that time. The Philippines is supposed to be a Republic!

Published in the Sun.Star Bacolod newspaper on May 02, 2011.

DMCI unit pushes expansion of Calaca facility

By Donnabelle L. Gatdula (The Philippine Star) Updated May 02, 2011 12:00 AM

MANILA, Philippines - DMCI Power Corp., the power generation unit of the Consunji Group, is proceeding with the first phase of the expansion project for the 600-megawatt (MW) Calaca coal-fired facility.
Nestor Dadivas, DMCI Power president, said they are now in the process of building two of the four 150-MW units of Calaca.
He said they expect the groundbreaking of the initial phase within the year.
The official said they would be raising the funds for the expansion program through project financing from various financial institutions.
Dadivas earlier said the investment level would greatly hinge on the power demand in Luzon.
“We are studying the power demand and supply situation in Luzon,” he said.
On top of the planned expansion program, DMCI Power is also in the middle of rehabilitating the Calaca power plant to increase its capacity by an additional 130 MW.
Parent company DMCI Holdings paid $150.79 million as downpayment for the purchase of the power facility located in Calaca, Batangas. Its bid offer was $361.7 million.The power plant will be operated by Sem-Calaca Power Corp., a new company recently established by Semirara Mining Corp., the coal mining arm of DMCI Holdings.
DMCI Holdings owns 56 percent of Semirara, which has exclusive rights to explore, mine and develop the coal resources on Semirara Island in Caluya, Antique. Semirara currently supplies coal to the Calaca facility.
The Calaca plant will utilize 100 percent Semirara coal. The plant will utilize about 1.6 million metric tons of coal annually.

DMCI Power to double Calaca capacity

Manila Times.net

THE power generating arm of the Consunji Group plans to double the capacity of the Calaca coal-fired power plant this year.

Nestor Dadivas, DMCI Power Corp. director, said the company plans to increase the capacity of the 600-megawatt Calaca facility.

“We hope to break ground within the year,” he said.

The company acquired the 600-megawatt Calaca plant in July 2009 in a state auction for
$361.7 million.

The facility is one of the Luzon grid’s four major coal plants, which were designed to run as base load generating facilities to meet consumers’ round-the-clock demand.

As such, the timing of the facility’s rehabilitation or expansion could contribute to the grid’s erratic reserves and possible outages.EUAN PAULO C. AÑONUEVO

Government urged to sell all remaining Napocor assets

(The Philippine Star) Updated May 02, 2011 12:00 AM

MANILA, Philippines - The country’s power producers are urging the government to sell all the remaining assets of the National Power Corp. (Napocor) to pave the way for true competition in the industry.
Philippine Independent Power Producers Association (PIPPA) president Ernesto Pantangco said while they laud the government’s continuing effort to privatize the assets of Napocor, this momentum should not wane.
“We continue to actively participate in several advocacies and I guess the first one is the continued implementation of the EPIRA and we think that number one, really, is the continued privatization of the Napocor assets,” he said.
He said there remains some items in the Napocor privatization that would have a great impact on competition in the power industry.
“We would like to see the privatization. If you look at Luzon, practically everything’s been taken care of in terms of the assets and IPPA (independent power producer adminstrators) contracts but if you look at Visayas, we still need to privatize Unified Leyte  because currently, despite the influx of the new coal-fired capacities, Unified Leyte still accounts for about 54 percent, which is still under government control. And we would like to see government go below the 30 percent threshold, which is applicable to all industries, to all participants,” he said.
Pantangco said there is also a need to auction the two remaining hydropower facilities complex in Mindanao.
“At the same time, although we are aware of the various sensitivities in Mindanao, we would still want to push for the privatization of the Agus Pulangi assets as well as the other IPPA contracts. Basically two major contracts, one is the Steag BOT, under IPPA and our Mindanao 1 and 2, and Mt. Apo with Energy Development Corp. (EDC), that’s still under contract with Napocor,” he said.
Earlier, Pantangco noted that privatization is still crucial to raise much needed capital for the power sector.
“We still think that privatization is still required in order to put in the much needed investments to rehab the power plants and to make them more reliable, so that’s why we’re still pushing for privatization of all the Napocor assets and contracts,” he said.
He said the privatization has also helped increase the generation capacities in the sector.
“This has been borne out of the fact that any power plant that private sector has taken over, there has been an increase in capacity to a reliable level plus new investments will be put in to further improve the installed capacities,” he said.
The Power Sector Assets and Liabilities Management Corp. (PSALM), created under the restructured Philippine electric power industry (Electric Power Industry Reform Act or EPIRA) in 2001, is tasked to manage, privatize and dispose of all existing generation assets, liabilities, real estate and other disposable resources of Napocor.

Subsidies to government firms more than double in 1st quarter

Business World Online

Posted on May 01, 2011 09:52:00 PM

SUBSIDIES to state firms more than doubled in the first quarter from a year ago, data from the Bureau of Treasury showed.

The government released P7.073 billion in subsidies to government-owned and -controlled corporations, up 112.79% from the P3.324 billion spend on these firms in the same period last year.
In March alone, these subsidies increased by an annual 10.7% to P2.757 billion.
The biggest recipient in the first quarter was the National Food Authority (NFA), which received P2.5 billion in March alone. This was to fund palay procurement, as the agency has targeted to buy as much as 870,000 metric tons of palay from farmers this year.
The NFA was followed by the National Power Corp. The state power firm got P2 billion for its Small Power Utilities Group, as the government stepped in to prevent its small power plants in far-flung areas across the country from running out of fuel.
The National Livelihood Development Corp. received P28 million in March to take its first-quarter total to P877 million.
The National Housing Authority got P574 million, while the Bases Conversion and Development Authority received P123 million in March for a total of P424 million in the first quarter.
The Philippine National Railways got P250 million.
Government corporations focused on health care received sizeable amounts in the first quarter as well: the Philippine Children’s Medical Center got P94 million; the Philippine Health Insurance Corp., P66 million; the Philippine Heart Center, P57 million; the National Kidney and Transplant Institute, P45 million; and the Lung Center of the Philippines, P24 million.
The Philippine Coconut Authority received P45 million in the first quarter, while the Tourism Promotions Board and the Cultural Center of the Philippines got P16 million each.
The Philippine Forest Corp. received P15 million and the National Electrification Administration, P14 million.
Trade-related government firms received some of the smallest subsidies: the Southern Philippines Development Authority got P15 million; the Center for International Trade Expositions and Missions, P7 million; the Aurora Special Economic Zone Authority, P4 million; the Zamboanga City Special Economic Zone Authority, P4 million; and the Cottage Industry Technology Center, P2 million.
The Philippine Rice Research Institute got P8 million in the first quarter, while the Philippine Institute for Development Studies received P4 million in March to bring its total take to P6 million.
Rounding up the list were the National Dairy Authority with P4 million, as well as the Philippine Institute of Traditional and Alternative Health Care and the Local Water Utilities Administration with P3 million each.
Subsidies to state firms form part of the government’s expenditures, which totaled P349.275 billion in the first quarter, about P81.9 billion below its P431.257-billion ceiling set for that period.
Expenditures declined by an annual 12.68% to P349.275 billion.
The government aims to keep its expenditures to P1.711 trillion this year.
With revenues targeted at P1.411 trillion, it hopes to cap its fiscal deficit at P300 billion, equivalent to 3.2% of the country’s gross domestic product. --Diane Claire J. Jiao

Luzon power crisis in 2013 looms–UP prof

business mirror

SUNDAY, 01 MAY 2011 19:24 LIZA T. AGOOT / CORRESPONDENT

BAGUIO CITY—The entire Luzon island is bound to again experience rotating brownouts in 2013.

This will happen even if the government immediately takes action on the impending power crisis in the Luzon grid.

Rowaldo del Mundo, professor of the University of the Philippines National Engineering and Electricity Center, said the country is likely to experience scheduled power interruptions and rotating brownouts to cope with the projected increase in electricity demand in 2013.

During a lecture in this city, del Mundo, an expert in electricity issues, said the Luzon grid forecasts a higher demand for electricity by 2013, which the power industry within the Luzon grid is incapable of supplying.

Luzon grid’s present capability, he said, is limited compared to the expected increase in demand among industries and businesses requiring a large amount of wattage and volume of power.

He said with the current production capacity of power producers, it would not be able to sustain the demand, thus the need for rotating brownouts to be able to meet market demand.

This is apart from both the scheduled and unscheduled maintenance and repairs that each power plant regularly undertakes when they shut down the turbines producing the electricity to prevent further problems.

The professor also said a power plant takes three years to operate once it has been set up.

Power plants are set up during an energy crisis because of the perks and tax holidays the power producers can avail themselves of when there is a crisis. These are not available on a regular year.

“Investments on power production are put in place by capitalists only during crisis so they could receive the incentives that the government can give,” said the professor.

The Limay oil power plant in  Bataan, which produces 620-megawatts of power, has saved the country in previous years. It is scheduled to be retired but could not be mothballed at this point because it will cause a major disruption in the power supply in the Luzon grid.

Del Mundo said the Energy Power Industry Reform Act (Epira),  or Republic Act 9136, passed in 2001 is designed to bring down electricity rates and improve the delivery of power supply to end-users by encouraging greater competition and efficiency in the electricity industry. The essence of these reforms is giving stakeholders a choice.

“Epira was envisioned to give consumers an assurance of an adequate and reliable power supply at lower rates,” he said.

Del Mundo said the law also states that there will be competition between and among power-generating companies when prices will be market-driven and competitive. There will be long-term contracts and a spot market where the trading of electricity between buyers and sellers will be undertaken. There will also be competition between and among generating companies where prices will be market-driven and competitive.

AboitizPower set to put up 300-MW plant in Mindanao

business mirror

SUNDAY, 01 MAY 2011 17:44 PAUL ANTHONY A. ISLA / REPORTER

LISTED AboitizPower Corp. said on Friday it is prepared to invest in the future of Mindanao as it looks into putting up a 300-megawatt (MW) circulating fluidized-bed coal-fired power plant in southern Davao.

AboitizPower said the project will be undertaken by subsidiary Therma South Inc. which is part of its commitment to supply the region’s power needs as its communities, industries, investments and commercial establishments grow—especially in Davao, which has the biggest power supply need in the region.

“AboitizPower has been in Davao for 50 years. Throughout that time and until the present, the company considers Davao its home. As a member of the community, AboitizPower is committed to being a partner in the growth of Davao  and Mindanao,” the company said.

Manuel Orig, AboitizPower first vice president for Mindanao affairs, said Mindanao needs a steady supply of power to fuel its growth, as industries, investments and businesses expand.

“This, in turn, will provide livelihood and development to communities. As communities and households increase, so will their demand for electrical power,” he added.

The demand for electricity for Davao and the rest of Mindanao is growing steadily but the supply, unfortunately, has been lagging behind the needed baseload capacity.

AboitizPower said government estimates show that unless power generation is increased soon, Mindanao will soon face a shortage.

By 2014, the shortage will be around 480 MW—enough to cut the entire power supply of the cities of Davao, Cagayan de Oro, General Santos, Zamboanga and Butuan.

AboitizPower assures that it is ready to do its part to help solve the problem through a long-term solution such as investing for the construction of a proposed 300-MW circulating fluidized-bed coal-fired power plant in southern Davao.

The company said it is prepared to invest its own funds, which now amounts to P25 billion, instead of seeking financing from other institutions to fast-track construction.

Orig said unless the proposed power plant is constructed soon, the energy supply situation in Mindanao will become more precarious, especially as 2011 enters the dry summer season.

“Dry months usually bring down the water level in Lake Lanao  which lowers the energy-generating capacity of the Agus-Pulangi hydropower complex, the lifeblood of Mindanao’s power supply,” Orig said.

He assured residents and the local government units that the proposed 300-MW facility is safe to operate and will not harm the environment or the communities surrounding it.

“AboitizPower has an excellent track record of human safety and environmental protection in its power-generation facilities. We guarantee that the proposed power plant will not cause harmful effects on the water supply, the health of the communities and the environment,” he added.

Orig said dirty coal power plants are those that used the technologies of the 1950s, 1960s and 1970s, and that new coal-fired power plants are proven to be safe, clean and reliable.  AboitizPower’s modern, high-technology coal-fired power plants meet international standards that keep them safe and environment-friendly.

Orig added that they will not do anything that will harm our own community,” Orig said.  He noted that there are already clean coal-fired power plants operating in the Philippines and in Mindanao, like the Steag State Power plant in Villanueva, Misamis Oriental and Cebu Energy Development Corp. in Cebu.

“These facilities continue to meet environmental standards and there has been no recorded incident that negatively affected the health and livelihood of the communities around it,” Orig said.

He further explained that AboitizPower is committed to finding the right balance of energy sources to meet the power needs of Mindanao, particularly Davao City. He adds that “our corporate philosophy is to provide safe, clean energy sources that benefit communities and protect the natural environment.”

AboitizPower operates hydroelectric power plants in Davao and Benguet as well. The company is set to build even more hydroelectric power plants in the next two years. Five hydropower projects have been started in 2011.

In Davao, AboitizPower is set to construct the hydropower plants Tudaya 1 (6.6 MW, upstream of Sibulan A) and Tudaya 2 (7 MW, downstream of Sibulan B) in August 2011 which are expected to be finished by December 2012.

Two other hydropower plants in Kitawtaw, Bukidnon, the 18-MW Sita and 12-MW Simod, are due for completion in 2013. In Benguet, the Irisan 3.8-MW hydropower facility will be completed in September.

However, these hydropower plants are dependent on ideal water levels—something that is affected during dry months. Low water levels result in low power-generation. “This is why together with these hydro-electric plants, clean coal-fired plants must also be ready to use. We need to get the right mix of power from different sources so that even in the summer or during El Niño, Mindanao will have reliable power,” Orig said.

SEM-Calaca to expand Batangas facility

business mirror

SUNDAY, 01 MAY 2011 17:43 PAUL ANTHONY A. ISLA

SEM-CALACA Power Corp. plans to double the existing capacity of its 600-megawatt (MW) Calaca coal-fired power plant in Batangas.

Nestor Dadivas, SEM-Calaca director, told reporters that the expansion of the Calaca power plant will be implemented in two phases. The first phase will initially involve the construction of two 150-MW coal-fired units. The company, Dadivas said, is eventually looking at installing four 150-MW units to expand the existing capacity of the Calaca coal-fired power plant. “We hope to break ground within the year,” he added. The expansion will be funded through financing agreements.

The Calaca facility consists of two 300-MW generating units and is primarily designed to run as a baseload plant and designed to use local coal from Semirara Mining Corp., a subsidiary of parent company DMCI Holdings Inc. (DMCIHI).

In July 2009, DMCIHI acquired the Calaca facility in a bidding held by the Power Sector Assets and Liabilities Management Corp. (Psalm). It has been allocated a substantial 287-MW power supply contract, or about 48-percent of the plant’s rated capacity.

Psalm said  Calaca will provide the new owner a ready market for the electricity that the power plant will generate. The Manila Electric Co. will assume the biggest portion of the contracted energy, which is equivalent to 169 MW.

Sem-Calaca Power is 100-percent owned by Semirara.  It was incorporated on November 19, 2009 aimed primarily to acquire, expand and maintain power-generating plants, develop fuel for generation of electricity and sell electricity. 

(Paul Anthony A. Isla)

WB offers $250-M loan for clean energy

Manila Bulletin

May 1, 2011, 12:15am

MANILA, Philippines – The World Bank urged the Philippine government to show more urgency in dealing with climate change, reiterating its offer of $250 million to help the country develop clean energy sources and better handle extreme weather conditions.

Andrew Steer, special envoy for climate change for Washington-based lender, said he has been pushing Manila to finalize a plan to cope with the potential impact of stronger typhoons, rising sea levels and an increase in global temperature, particularly on agriculture.

''The real challenge of the Philippines, and it's important that citizens are aware... that over the coming decades, unless the world takes tougher action, there are certain things that are going to happen that are not good,'' Steer, in Mania to meet officials and lawmakers, told a news conference.

''One and most immediately, extreme weather events, especially typhoons will become more serious, and it has huge impact on the Philippines.''

He called on Manila to finalize and implement a climate change action plan, including a strategy to mitigate flooding in coastal and low-lying communities.

The World Bank has also offered to provide an insurance facility for local governments that need funds to cope with disasters as well as in the recovery and rehabilitation efforts.

To combat climate change, the bank has been helping developing economies switch to clean-energy technologies to curb carbon emissions, and has supported government and private sector investments in the development of wind and solar energy.

The Philippines annual carbon emission rate is less than 2 tonnes per person, low compared with more than 20 tonnes per head in wealthy European and Middle Eastern states.

Aboitiz Power rushing Davao plant

Manila Standard Today
by Alena Mae S. Flores

Aboitiz Power Corp. plans to initially spend an estimated P25 billion of its own money instead of seeking funding from lending institutions to speed up the construction of a 300-megawatt coal-fired power plant in Davao City and Davao del Sur province.

“We will initially invest our own funds to start construction and seeking financing later,” Luis Miguel Aboitiz, senior vice president of Aboitiz Power, said.

The Davao coal plant will become a unit of subsidiary Therma South Inc. Aboitiz Power has committed to supply Mindanao’s power needs with the expected surge in demand from communities, industries, investments and commercial establishments.

“The region needs a steady supply of power to fuel its growth, as industries, investments and businesses expand. This, in turn, will provide livelihood and development to communities. As communities and households increase, so will their demand for electrical power as well,” Manuel Orig, Aboitiz Power first vice president for Mindanao affairs, said.

The demand for electricity in Davao and the rest of Mindanao is growing steadily but supply has lagged behind the baseload capacity.

Government estimates show that unless power supply generation is increased soon, Mindanao will face a power shortage. By 2014, the shortage will be around 480 MW—enough to cut off the entire power supply to the cities of Davao, Cagayan de Oro, General Santos, Zamboanga and Butuan.

Orig said that unless the proposed power plant was built soon, the energy supply situation in Mindanao would become more precarious, especially with the dry season this year. Dry months usually bring down the water level in Lake Lanao, which in turn lowers the energy-generating capacity of the Agus-Pulangi hydropower complex—Mindanao’s power supply.

Orig assured residents and local government units that the proposed 300-MW coal plant in southern Davao was safe and would not harm the environment or the communities surrounding it.