Davao Light inks advance deal with Therma South

Business Mirror

Published on Sunday, 28 October 2012 18:12

Written by Manuel T. Cayon and Paul Isla / Reporters

DAVAO CITY—Mindanao’s largest distribution utility, Davao Light and Power Co. has signed an advanced power-supply agreement with sister-generation company in the Aboitiz Group of companies, to meet future power demand with the influx of big business and an consequent burgeoning of its population.

The Davao Light on Thursday signed a power supply contract with Therma South Inc. to supply the former with 100 megawatts beginning 2015, when the construction of the coal plant in Toril, west of downtown, would be expected to be completed.

The coal plant is projected to carry 300 megawatts.

Davao Light has an estimated peak demand of 290 megawatts, serving more than 300,000 customers in the cities of Davao and Panabo, Davao del Norte, as well as neighboring municipalities of Carmen, Dujali and Santo Tomas, also of Davao del Norte.

The company said demand would increase to 345 megawatts by the end of 2015.

Arturo M. Milan, executive vice president and chief operating officer of Davao Light and Power Co., signed the contract with Roland U. Gaerlan, vice president for marketing and sales of AboitizPower.

The power-supply contract will be submitted for approval by the Energy Regulatory Commission.

“Within Davao Light and Power Co.’s franchise, large firms have made firm indications to require more power. Some steel manufacturing, storage, mall, condominium and hotel companies are now in the construction phase,” Milan said.

He said the city has experienced “rapid economic growth as seen through the building constructions in several parts of the city and added that “some studies also showed strong correlation between electricity use and wealth creation.”

Currently, he said, “Davao Light’s existing power supply is tight” but assured that the company has shielded its franchise from the rotating brownouts “by using its embedded power plants—Sibulan & Talomo hydroelectric plants and the Bajada diesel power plants.”  

The company has also a power contract with Therma Marine Inc., which owns the power barge moored offshore of Maco, Compostela Valley.

“Big industrial customers are also doing their share to help.  When requested by Davao Light during critical shortage levels, they run their own generators for their power needs.  The power that they would have drawn from the distribution lines can be used by more smaller customers,” Milan said.

He said the lack of power in the Mindanao grid has forced two to three hours of rotational outages, in many provinces.  

The power shortage in Mindanao has been heightened with the repair of the Steag State Power coal plant in Villanueva, Misamis Oriental.    source