AboitizPower to internally raise P25-B coal investment

Sunstar Davao

ABOITIZPOWER Corp. is prepared to use its own funds to raise the P25 billion needed to build the proposed 300-MW circulating fluidized-bed coal-fired power plant at the boundary of Davao City and Sta. Cruz town in Davao del Sur, a top official of the company said.

Manual Orig, first vice president for Mindanao Affairs of AboitizPower Corp., said that due to the urgency of the power crisis in the island, the company will not seek help of financing institutions like banks for the project. This would mean construction could start immediately once the project receives the approval of the government and the local community.

"The power crisis in Mindanao is in a very critical stage and we are ready to spend P25 billion to help solve the problem," Orig said. "This is an affirmation of Aboitiz Power's commitment to the development of Davao and faith in the future of Mindanao."

The proposed project of AboitizPower subsidiary Therma South Inc. is perhaps one of the biggest single investments in Mindanao. No less than 1,000 people will be needed for the 40-month construction of the facility and 200 people will be employed during the regular operations of the plant.

The proposed project will be built in a 52-hectare property in Barangay Binugao in Toril, Davao City and Inawayan in the municipality of Sta. Cruz.

The Davao City Council held its first joint committee hearing on the project last March 24. Executives of AboitizPower presented the project while the oppositors were also given the chance to speak against the proposal.

Orig said Davao City, being the biggest consumer of power in Mindanao, needs reliable and affordable sources of power to meet the demands of growing industries, investments and commercial establishments like malls coming into the city. He said the company will not be investing this huge amount of money on Mindanao if the threat of a power shortage is not urgent.

He assured that AboitizPower with its excellent track record will guarantee that the proposed power plant will be safe and will not cause harmful effects on the water supply, the health of the communities and the environment.

"Dirty coal power plants are those that used the technologies of the 1950s, 1960s and 1970s. New coal-fired power plants are proven to be safe, clean and reliable," Orig said.

"The people of Davao have known the Aboitiz Group for more than 50 years and we consider Davao as our home. We will not do anything that will harm our own community," Orig said.

He pointed that existing clean coal-fired power plants are existing 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 standards and there had been no recorded incident that negatively affected the health and livelihood of the communities around it," Orig said.

The Mindanao power situation is expected to be precarious once more as 2011 enters into tits summer months. The dry summer usually brings water level Lake Lanao down, affecting the generating capacity of the Agus-Pulangi hydropower complex, the lifeblood of Mindanao's power supply.

"We need to get the right mix of power from different sources so that even in the summer or during El Nino, Mindanao will have reliable power," Orig said.

Government estimates that the Mindanao power shortage is set to worsen and that 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, Gen. Santos, Zamboanga and Butuan.

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