Government assures no Luzon power shortage by 2016

Business Mirror

Published on Thursday, 31 January 2013 20:37

Written by Lenie Lectura / Reporter

THE Department of Energy (DOE) on Thursday said the Luzon grid is not going to experience any power shortage by 2016, contrary to the recent observation aired by Manila Electric Co’s. (Meralco) top official.

In a statement, the agency said the peak demand in Luzon grid is indeed expected to increase at an annual average rate of 4.13 percent from 7,969 megawatts (MW) in 2012 to 16,477 MW in 2030.  Based on this, correspondingly, the grid will require an additional 500 MW by 2016 and 8,100 MW by 2030.

However, the DOE noted that there are committed power projects that will address this and eventually avoid the anticipated brownouts. 

“In response to Meralco’s statement that Luzon grid will experience power shortage due to the lack of new power plants coming in, the Department of Energy notes that in the 2012 Power Development Plan [PDP], peak demand in Luzon grid is expected to increase.… The PDP assumes that there are committed power projects that are expected to be on line starting 2013 until 2015,” it said.

 For this year, the following power facilities will be up and running: 600-MW GN Power; 21-MW CIP 2 Bunker; 67.5-MW Pililia Wind; 1.2-MW Payatas LF; and 13-MW Green Future Biomass.

The DOE said the 600-MW GN Power will be on commercial operation by May, while the 1.2-MW Payatas LFG by Pangea by March 2013. Meanwhile, the 21-MW CIP 2 Bunker was fired up on January 17, while the 13-MW Green Future Biomass has been operational since November 2012 but not in full capacity.

The 20-MW Maibarara Geothermal project, which is originally scheduled to be up and running by 2014, will be commissioned by July 2013 and commercial operation is sometime fourth quarter of this year.

 By 2015, the DOE  expects that the 135-MW Puting Bato Coal Phase 1 and the 11-MW SJCI Power Rice Husk will be fired up.

“In addition to new power plants, there are also rehabilitation of power plants that will add capacity to the grid, these are: 130-MW additional capacity from Bacman Geothermal and 5 MW per year, starting 2012 up to 2015, from Binga hydro uprating,” added the DOE.

On Wednesday Meralco Chairman Manuel Pangilinan warned that Luzon may experience power shortage if no new power facilities are installed.

“We do need more power plants in the country. The margin of [supply] safety in Luzon is very very tight and unless we fire up our oil-fired plants, we will experience brownout in Luzon,” Pangilinan said during the Philippine Economic Summit 2013.

Meralco President Oscar Reyes also anticipates that there would be “increasing tightness in 2013-2016 until new power-generating plants come in.”   source

Subic solar-energy firm gets DOE perks

Business Mirror

Published on Thursday, 31 January 2013 20:31

Written by Henry Empeño / Correspondent

SUBIC BAY FREEPORT—Banda Solar Corp., a pioneering alternative energy company based in this free-port  zone, is now gearing up to provide local customers with cost-efficient and environment-friendly solar-power systems after securing a certification from the Department of Energy (DOE).

Bob Silvers, president of Banda Solar, said his company has been allowed by the DOE to avail itself of incentives such as zero-percent value-added tax rate, tax- and duty-free importation of components and parts and materials, as well as income tax holidays, after a stringent evaluation and site validation by the DOE.

The accreditation is valid for three years.

Silvers added that the DOE certification would allow the manufacture of affordable solar-energy products in the country, since the bulk of these products used in the Philippines are being imported from China, Germany and the United States.

This would also help the firm promote its products better and in the process make alternative energy systems more accessible and affordable to the public, he said.

“[The DOE] incentives will be passed on to our customers to encourage them to use solar-powered products, thus helping in the improvement of renewable energy industry as well as achieving additional advantageous effects to the environment,” Silvers added.

Banda Solar, a Subic-registered company that began as Bandacorp PI Inc. in 2006, is now producing export-quality energy and lighting systems and distributing solar panels and light-emitting diode lamps (LED) that could cut down power costs by more than 50 percent.

To promote the environment-friendly system, it also provides free consultation on solar power, as well as briefing on energy-saving devices ranging from air-conditioning system to solar street lights, solar water heater, and even home and industrial solar-lighting solutions.

As the first small-business enterprise dealing on alternative energy projects to receive such a DOE accreditation, Banda Solar is also looking at promoting the use of renewable energy in the Subic Bay Freeport by working with Subic Enerzone, the local power distributor, and the Subic Bay Metropolitan Authority in the Tipo Expressway lighting project.

The company is also promoting alternative energy awareness among residents of local communities by installing a one-kilowatt power station in Iram, an upland village populated mostly by Ayta tribesmen.

Silvers said solar power is picking up locally, as evidenced by strong demand for solar power or LED lamp systems among Subic companies like the Ocean Adventure marine theme park, gastight plastic storage manufacturer GrainPro, packaging manufacturer Pactec, global testing and certification firm SGS and ink solution provider Printing Images CtC Inc.

Banda Solar has also installed solar power systems to clients in Pampanga, Batangas, Ilocos Sur and Zambales.   source

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In Photo: Bob Silvers, president of the Banda Solar Corp., proudly shows his company’s accreditation certificate from the Department of Energy. (Henry Empeño) 

Firm Expanding Its Hydro Portfolio

Manila Bulletin

By Myrna M. Velasco

January 31, 2013, 5:59pm

Local firm Sta Clara Power Corporation is on expansion mode, with its latest 8.0 megawatt mini-hydropower venture via a tie-up with Union Energy of businessman Lucio Co.

The project developers, in a press statement, bared that they will be spending P1.9 billion for the proposed Catuiran hydropower facility’s construction in off-grid Mindoro. It is targeted on stream in 2016.

Effectively, it will be an addition to the company’s hydropower generation portfolio, which includes the 1.2MW Loboc mini-hydropower facility in Bohol; the 0.8MW Amlan plant in Negros Occidental and the 70MW Bakun facility in northern Luzon, wherein it takes the function of being an independent power producer administrator or IPPA.

The company’s other projects would be the 9.0MW Cantakoy mini-hydro project in Bohol, Tinoc mini-hydro projects as well as some other prospects in Luzon and Mindanao.

Sta Clara chairman Nicandro G. Linao has noted that this will be the company’s contribution in helping solve supply shortages which has not spared the island-province.

This run-of-river facility will be the initial foray of Co in power generation. He will effectively be joining the bandwagon of renewable energy (RE) developers which are anticipated swarming the electricity sector following the shaping of policies in that investment area.

Linao have noted that power interruptions in Mindoro has resulted in “huge losses for businesses”, hence, his company will be coming in “to address (these) concerns by putting up the Catuiran hydro project.”

Based on the project brief, the facility will be sited approximately 30 kilometers southwest of Calapan City and will be drawing its water supply for power generation from the Catuiran river.

Sta. Clara president Asisclo T. Gonzaga has emphasized that the facility will be their response to the government’s call for RE-based investments in the power generation sector.

“We expect to start construction within the year… with the growing concern on the environment, it has been proven that mini-hydropower has the least adverse effect on the environment thereby making it the most socially-acceptable energy source,” he explained.   source

Union Energy, partner to put up P1.9B hydro power plant

By Amy R. Remo
Philippine Daily Inquirer

12:54 am | Thursday, January 31st, 2013

Union Energy Corp., led by Puregold owner Lucio Co, and power firm Sta. Clara Power Corp. are putting up a P1.9-billion mini-hydro power project, aimed at helping secure the electricity requirements of consumers in Oriental Mindoro.

Sta. Clara board chairman Nicandro G. Linao, officials of Union Energy and the local government of Oriental Mindoro will lead the scheduled groundbreaking ceremonies on Thursday for the 8-megawatt facility.

“We are very happy to work with Union Energy for the Catuiran Project, which will address the growing power needs of Oriental Mindoro and nearby areas. The provinces of Mindoro have been relying on National Power Corp.’s Small Power Utilities Group for its power requirement and have not been spared [from] power shortages,” Linao said in a statement issued Wednesday.

“Needless to say, it resulted in huge losses for businesses. We aim to address these concerns by putting up the Catuiran hydro project,” Linao added.

According to the statement, the project site for the mini-hydro power project is located about 30 kilometers southwest of Calapan city and in the southern side of the Catuiran river, one of the major river systems in Oriental Mindoro that originate from Mt. Halcon.

The planned power plant is expected to start commercial operations in 2016.

“We are supporting the government’s call for the more green energy sources under the Renewable Energy law. We expect to start construction within the year,” noted Sta. Clara president Asisclo T. Gonzaga.

“With the growing concern on the environment, it has been proven that mini-hydropower has the least adverse effect on the environment, thereby making it the most socially acceptable energy source,” Gonzaga added.

Sta. Clara Power is a local renewable energy developer that owns and operates the 1.2-MW Loboc mini hydropower plant in Bohol and has a 45-percent stake in the Amlan mini-hydro facility in Negros Occidental.   source

Two energy firms in P1.9-B hydro project

Manila Standard Today

Written by Madelaine B. Miraflor  Reporter  Published on 31 January 2013

Lucio Co-owned Union Energy and renewable energy developer Sta. Clara Power Corp. said on Friday that they are forming a partnership for eight mini hydropower projects in Oriental Mindoro costing P1.9 billion.

Sta. Clara, which is chaired  by Ni­can­dro Linao, together with Union Energy and local government officials, will hold today the ground­breaking ceremonies for the P1.9-billion mini hydro project.

He said that the project intends to address the growing power needs of Oriental Mindoro and its nearby areas.

”The provinces of Mindoro has been relying on the National Power Corp. Strategic Power Utilities Group for its power requirement and has not been spared of its own power shortages. Needless to say, it resulted in huge losses for businesses. We aim to address this concerns by putting up the Catuiran Hydro Project,” Linao added.

The project site is approximately 30 kilometers southwest of Calapan City.  It could be reached through a national road that is accessible through a dirt road.

The facility is an 8-megawatt (MW) capacity run-of-river project that will be located in the southern side of the river.

The power plant will be up and running by middle of 2016.

”We are supporting the govern­ment’s call to put up green energy sources under the Renewable Energy Law. We expect to start construction within the year,” Asisclo Gonzaga, Sta. Clara Power president, said.

”With the growing concern on the environment, it has been proven that mini-hydropower has the least adverse effect on the environment thereby making it the most socially acceptable energy source,” he added.

Sta. Clara Power currently owns and operates the 1.2-MW Loboc Mini Hydropower Plant located in Bohol, and has a 45-percent stake in the Amlan Mini Hydro in Negros Occidental.

The company is also a partner of Vivant for the administration of the 70-MW Bakun Hydroelectric Power Plant. Its other projects include the 9-MW Cantakoy Mini Hydro Project in Bohol and Tinoc Mini Hydro projects.
Sta. Clara Power has upcoming projects in Mindanao and Luzon.

Meanwhile, Union Energy Corp., led by Puregold owner Lucio Co, recently poured in P1 billion in investments for a 9.9-MW rice husk biomass power plant in San Jose City, Nueva Ecija.

Union Energy said in an earlier statement that the project would be the first biomass project to be launched since the issuance of the feed-in-tariff rates in July this year.

The planned facility, which will be using rice husk as feedstock, will be established by Union Energy and about 20 rice millers in Nueva Ecija through a joint venture called San Jose I Power Corp.   source

Lucio Co invests in Mindoro mini-hydro project

By Iris C. Gonzales (The Philippine Star) | Updated January 31, 2013 - 12:00am

MANILA, Philippines - Chinese-Filipino businessman Lucio Co, the majority owner of the Puregold supermarket chain, has partnered with renewable energy developer Sta. Clara Power Corp. for an eight-megawatt mini-hydropower project in Catuiran, Oriental Mindoro.

Co’s Union Energy and Sta. Clara Power will put up a P1.9-billion mini hydropower project, which is expected to be operational in the middle of 2016. The partners plan to start construction this year, company officials said.

Sta. Clara Power chairman Nicandro Linao said they are scheduled to hold the groundbreaking ceremonies today.

“We are very happy to work with Mr. Co’s Union Energy for the eight-megawatt mini-hydropower project,” Linao said.

He said the project is seen to address the growing power needs of Oriental Mindoro and its nearby areas.

Mindoro has been relying on the National Power Corp.-Small Power Utilities Group for its power needs but has also been experiencing power shortages.

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 “Needless to say, it resulted in huge losses for businesses. We aim to address this concerns by putting up the Catuiran hydro project,” Linao said.

 The eight-MW hydropower run-of-river project, to be established on the southern side of the Catuiran river, would be on line by the middle of 2016, he also said.

The Catuiran River is one of the major river systems in Oriental Mindoro that originates from Mt. Halcon, is the highest mountain in Mindoro Island.

The river runs through mountainous regions from upstream to midstream where the project site is located.

For his part, Sta. Clara president Asisclo Gonzaga said the company’s latest venture supports the government’s call to put up green energy sources.

“We are supporting the government’s call to put up green energy sources under the renewable energy law. We expect to start construction within the year,” Gonzaga said.

Sta. Clara Power currently owns and operates the 1.2-MW Loboc mini-hydropower plant in Bohol and has a 45-percent stake in the Amlan mini-hydro in Negros Occidental. Other projects include the 9-MW Cantakoy mini-hydro project in Bohol, Tinoc mini-hydro projects and other upcoming projects in Mindanao and Luzon.

Union Energy, meanwhile, owns 66 percent of San Jose City I Power Corp., a renewable energy company that plans to build a 9.9-MW biomass plant in Tulat Rd., San Jose City, Nueva Ecija.   source

Meralco warns of blackouts

By Donnabelle Gatdula (The Philippine Star) | Updated January 31, 2013 - 12:00am

MANILA, Philippines - Expect frequent blackouts across Luzon beginning this year if no new sources of power are established to support the country’s economic growth, Manila Electric Co. (Meralco) chairman Manuel Pangilinan said yesterday.

“We do need more power plants in the country. The margin of (supply) safety in Luzon is very tight, and unless we fire up our oil-fired plants, we will experience brownout in Luzon,” Pangilinan said during a roundtable discussion at the Philippine Economic Summit 2013.

Meralco president and chief executive officer Oscar Reyes said the power firm recorded 7.1 percent growth in sales as of end-2012 on higher revenues from industrial, commercial and residential customers.

Industrial, commercial and residential sales volume grew by about 11 percent, six to 6.5 percent, four to 4.5 percent, respectively, from the previous year.

With this growth momentum, Reyes said “we anticipate that there would be increasing tightness in 2013-2016 until new power generating plants come in.”

Reyes said the government – in its Philippine Energy Plan – sees the need for additional energy capacity of 3,000 megawatts capacity in the next five years, taking into account a growth of only 4.5 percent.

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“So there would be shortfall,” he said, noting that building a power plant usually takes three to five years.

Economic guru Nouriel Roubini noted in the summit that the country’s GDP is likely to grow by 6.5 percent in 2012 and seven percent in 2013.

To ensure sufficient and adequate supply of power in its franchise area, Meralco entered into long-term bilateral contracts involving 2,880 MW. Many of these contracts will replace expiring ones with the National Power Corp.

Meralco is also putting up its own power plants with total capacity of about 2,900 MW from 2016 to 2019.

These new capacities will include 600 MW in Subic, 1,700 MW liquefied natural gas (LNG) facility in Quezon/ Batangas, and 600 MW baseload facility in an undisclosed location.

The new plants would represent 30 percent of the total power requirement of Meralco and the remaining 70 percent would be sourced through bilateral contracts with other power producers.

Philippine power producers have been urging the government to assure sufficient supply of reliable and competitively priced power in anticipation of increase investments in the country.

“Given the latest developments, it is already necessary to put up the necessary infrastructures that will secure the continuous supply of electricity,” Philippine Independent Power Producers (PIPPA) president Ernesto Pantangco said, referring to the country’s economic gains.

“An unreliable power system charging high energy costs dissuades investments and investors both in the short and long-term. Baseload power plants that run on coal or natural gas produce energy at a constant rate, usually at a more competitive cost relative to other power facilities available to the system,” he said.

According to the Department of Energy (DOE), the current electricity consumption rate in the Luzon grid means that three new 600-MW power plants have to be in service every year from 2015 to 2017.

The Philippine Energy Plan states that 11,000 MW in additional capacity is needed until 2030. This projection is based on a 4.79-percent annual growth in energy demand.

Currently, the country only has 13,000 MW in dependable capacity.

The association of power generators is also pushing for the diversification of fuel sources to balance the overall energy mix.  source

Power subsidy

Manila Standard Today

By Othel V. Campos  Posted on Jan. 31, 2013 at 12:00am

The Trade Department is negotiating to increase the maximum number of companies  allowed under the Industry Competitiveness Fund and possibly include the fund in the annual budget.

“We are preparing a program that will continue the implementation of the ICF and provide it with strong legal support like including it in the succeeding [General Appropriations Act],’’ Trade Undersecretary Cristino Panlilio said.

The ICF is a program extended to big manufacturing companies to subsidize their power costs. The program expired in 2011, but there are still companies who are still enrolled in the program.

Among the last few companies benefiting from the fund is Phoenix Semiconductors Philippines Corp., whose ICF is valid until 2020.   source

Power outages in Luzon feared

Manila Standard Today

By Alena Mae S. Flores  Posted on Jan. 31, 2013 at 12:01am

Meralco on Thursday said Luzon will experience tightness in power supply between now and  2016 unless more power plants are built to meet demand amid a projected strong economic growth.

Meralco chairman Manuel Pangilinan said, “We do need more power plants in the country. The margin of safety in Luzon is very very tight. And unless we start up our oil-fired plants, (we may) experience brownout in Luzon.”

He spoke at the Philippine Investments Summit even after the Philippine Independent Power  Producers Association already urged the government to prepare for the increased  demand due to the strong economy.

The power outlook for Luzon came after Mindanao was buffeted by recurring brownouts last year.

Meralco president Oscar Reyes, for his part said that under a “tight supply scenario,” the Luzon grid may suffer brownouts if a 600 MW to 1,200 MW unexpectedly goes offline.

“If the oil-fired power plants have to fill in the tightness that will influence the price (of electricity),” he said.

Reyes said that in anticipation of this “tightness” and ensure adequate power supply, Meralco, through the Meralco PowerGen Corp., is already planning to build 2,880 megawatts of new capacity in the long-term.

“We are trying to put in place our own generation portfolio. The first is RP Energy of 600 MW which the Luzon grid really needs to come in by 2016,” he said.

PIPPA, the association of the country’s independent power producers, comprised of the country’s biggest power players, said last week that government should assure sufficient, reliable and competitively-priced power in anticipation of increase investments in the country.

PIPPA, in a statement, cited the reports of the Philippine economy beating forecasts and further expectations of accelerated growth which required adequate, reliable and competitively-priced power supply.

PIPPA president Ernesto Pantangco said the government should take advantage of the momentum signalled by the latest gross domestic product figures and the historic highs in the Philippine Stock Exchange.

The country’s GDP has been forecasted at over 6 percent to 7 percent this year.

“Given the latest developments, it is already necessary to put up the necessary infrastructures that will secure the continuous supply of electricity,” Pantangco said.

Building reliable, adequate and competitively-priced power supply provided by baseload power plants are the key to meeting the country’s energy supply needs while keeping prices stable especially for power-intensive industries, he said.   source

Power agency granted P1.6B in aid to 41 co-ops in 2012

Business Mirror

Published on Wednesday, 30 January 2013 18:35

Written by Lenie Lectura / Reporter

THE National Electrification Administration (NEA) on Wednesday reported that it disbursed P1.6 billion in financial assistance to 41 electric cooperatives (ECs) via its Enhanced Lending Program in 2012.

“This is part of the agency’s program in assisting electric cooperatives to be operationally strong and viable distribution utilities in…the competitive electricity industry,” NEA Administrator Edita S. Bueno said in a statement.

A P10-million calamity loan was each availed of by the Isabela Electric Cooperative I and the Agusan del Sur Electric Cooperative. The amount was used to restore power lines that were destroyed by recent typhoons.

Critically situated Lanao del Sur Electric Cooperative was given a concessional loan of P29.93 million at 6-percent interest rate per annum for the replacement and installation of meters and distribution transformers in order to improve its operational performance.

Likewise, the Single Digit System Loss Loan was granted to eight ECs to assist them in reducing their annual systems losses by at least 1 percent yearly and thereby improve system reliability.

The System Loss Reduction Program includes activities such as replacing power transformers; meter pole clustering; rehabilitating defective lines and replacing defective kilowatt-hour meters; and installing grounding transformers, gas circuit breakers, and system power protectors.

Those who availed themselves of the loan include Mopreco, P12 million; Batanelco, P6.7 million; Cagelco II, P20.37 million; Presco, P9.95 million; Casureco I, P11.5 million; Leyeco III, P12 million; Anec, P27.44 million; and Surseco I, P3.28 million.

Thirty-five ECs were granted Rural Electrification Loans, among them Cagelco I (P50 million), Cenpelco (P40 million), Iselco I (P50 million), Ormeco (P43.33 million) and Casureco II (P122 million). The loans will be used as working capital to pay for their power accounts.

Other ECs, such as Neeco II-Areas 1 & 2, Aurelco, Romelco, Canoreco, Ileco I, Boheco II, Buseco, Moresco I & II, Camelco, Fibeco, Laneco, Doreco, Socoteco I and Aselco also availed themselves of this loan, mostly for the rehabilitation and upgrading of their distribution systems.

NEA encourages ECs to avail of its Enhanced Lending Program because of the competitive interest rate at 9 percent per annum for loans to be repaid in more than two years and 8 percent per annum for loans to be paid within two years or less.

The program has no other charges for term loans; a longer repayment period; a fast processing period; an electronic fund transfer; minimum requirements; assistance in the preparation of project-feasibility studies; and personalized service.   source

219 Meralco Customers To Benefit From New Peak/Off-Peak Rates

Manila Bulletin

By Myrna M. Velasco

January 30, 2013, 5:16pm

About 219 large customers of Manila Electric Company (Meralco) are expected to benefit from cost savings with its provisionally approved peak/off-peak rate (POP) program.

Based on data analysis it furnished the Energy Regulatory Commission (ERC), at least 75 customers which were previously granted discounted rate under the Customer Choice Program (CCP) and another 144 end-users from the Ecozone Rate Program (ERP) will reap overall cost reduction even without them shifting their consumption from peak to off-peak hours.

The discounted tariff for big electricity end-users were previously given to 86 CCP customers and 352 ERP-qualified end-users as part of the government’s resolve to ease the industries hefty burden on electricity costs. These availees have 43.8-percent share in the country’s manufacturing sector and their exports contribute around $19.6 billion in revenues.

The regulator noted that a timely approval of the POP-applied rates of Meralco is necessary to prevent a scenario wherein industrial users would be prompted to relocate their manufacturing facilities in other countries. The new rates will be effective this January billing.

It can be gleaned from the ERC decision that the new peak rates are higher than the previously-approved tariffs, but the off-peak rates have been remarkably reduced.

For the months January to June, the approved peak rate is at P7.4854 per kilowatt hour (kWh); and it is at P7.2779 per kWh for July to December. Notably, these are higher compared to the previous time-of-use (TOU) rates at P6.4852 per kWh and P6.1053 per kWh, respectively, for the same periods.

The off-peak rate for January to June as well as July-December is at P3.5461 per kWh, which is also higher than the previous off-peak TOU rate of P3.0925 per kWh.

The load shifts to the cheaper off-peak rates are seen beneficial to industries like cement, steel, glass, textile, electronics, semiconductors, plastic, business process outsourcing (BPO), telecommunications and water utilities, among others.

The ERC ruling has noted that there is a “wider price difference” between peak and off-peak in the new POP rates.

It stressed that the newly approved tariffs will not only encourage end-users to shift to the lower cost off-peak hours, but it will also benefit the distribution utilities to shave on peak loads, hence, helping hem improve their load factors.

“Meralco designed its revised TOU retail rates in such a way that it will have a wider spread between peak and off-peak rates so as to encourage customers to respond to the pricing signal and consume electricity during off-peak periods,” the regulator said.  (MMV)   source