SNAP-Benguet offers rehabilitated Ambuklao power plant

Business Mirror
WEDNESDAY, 26 OCTOBER 2011 19:01 PAUL ANTHONY A. ISLA / REPORTER


BOKOD, Benguet—SN AboitizPower (Snap)-Benguet—the joint venture between SN Power of Norway and AboitizPower Corp.—is offering the newly rehabilitated 105-megawatt (MW) Ambuklao hydropower plant to provide ancillary services to the National Grid Corp. of the Philippines (NGCP), Emmanuel Rubio, the company’s president and chief executive officers, told reporters on Wednesday.


At the sidelines of the inauguration of the 105-MW Ambuklao hydropower plant, the Snap official said they hope to finalize the ancillary service agreement with the NGCP before the end of November. Ancillary services refer to capacity and energy needed to maintain a stable and reliable operation of the transmission system.


Apart from trading the Ambuklao plant as a merchant plant to the Wholesale Electricity Spot Market (WESM), Rubio said providing ancillary services to the NGCP would be another market for the Ambuklao plant.


Considering the Ambuklao’s capacity, Rubio said the approach for the power plant is to offer for ancillary service to NGCP similar to Snap’s other assets—the Magat and Binga hydropower plants.


To date, the electricity generated from the Ambuklao and Binga hydropower plants are fully traded at the WESM.


Rubio made it clear that they still need to secure the approval of the Energy Regulatory Commission (ERC).


“Negotiations are progressing very well. NGCP needs to sign additional capacities for ancillary and I don’t think they have met the required ancillary requirements in the grid. The Ambuklao is one of those plants that can meet that requirement. We haven’t received the certification yet, though we have passed the test to provide ancillary services conducted by NGCP,” he said.


Once certified, Rubio explained that they can enter into an ancillary supply contract with NGCP, which has to be approved by the ERC.


He added that they are even offering the entire plant’s output for ancillary service.


Rubio noted that the NGCP may consider Snap-Benguet as a better source of ancillary services since its rates are highly competitive compared to the rates of other power plants.


“Hydropower plants are the ones preferred by the NGCP to provide ancillary services because of their cost competitiveness. In terms of performance compared to diesel and coal, it cycles much faster than those plants,” he said.


In 2008 Snap-Benguet acquired the Ambuklao-Binga hydropower complex through a bidding done by the Power Sector Assets and Liabilities Management Corp. That same year, the Ambuklao plant’s rehabilitation began, to restore the plant and increase its capacity to 105 MW from 75 MW after two years of rehabilitation following a 12-year shutdown.


Snap-Benguet spent an additional $280 million on top of the $325-million purchase price to rehabilitate and refurbish the Ambuklao and Binga hydropower plants not only to restore the capacities but to also increase them by 105 MW and 120 MW, respectively.


The Ambuklao plant is now also registered under the Clean Development Mechanism and expected to generate 180,000 carbon credits, which is the realization of Snap-Benguet and the government’s strong and long-term commitment to renewable power for all.