Alsons unit seeks go signal for Zamboanga supply deal

Business World Online
Posted on April 23, 2014 09:20:08 PM

A UNIT of Alsons Consolidated Resources, Inc. (ACR) and a power distributor in Zamboanga have sought regulatory approval for a three-year supply deal, a petition dated March 31 showed.

Mapalad Power Corp. (MPC) and Zamboanga del Norte Electric Cooperative, Inc. (ZANECO) asked the Energy Regulatory Commission to authorize the implementation of their power sales agreement (PSA).

Under the deal, MPC will supply a total of 5 megawatts (MW) to ZANECO through its existing 103-MW diesel plant in Iligan City.

“MPC shall commence supplying power within three weeks from the effective date of the PSA,” the petition read, noting this will run for a period of three years.

The petitioners said that the National Power Corp., through the Power Sector Assets and Liabilities and Management Corp. (PSALM), still supplies bulk of the requirements in Mindanao.

“However, PSALM has drastically reduced its supply commitment to distribution utilities in Mindanao, resulting in power shortages throughout the region,” the petition read.

ZANECO’s supply is insufficient to meet the power needs of its customers as a result of the reduction.

“[T]he franchise area of ZANECO has suffered significant power outages, adversely affecting local businesses and the daily lives of all electricity consumers,” the two parties noted.

ZANECO was compelled to procure additional power supply and other than MPC’s, there was no other viable alternative supply available to address the power shortage.

With the supply coming from MPC, ZANECO’s blended generation rate was expected to reach P4.77 per kilowatt-hour (/kWh) with a one-hour outage per customer.

Without MPC, power interruptions run for three hours, although the generation rate is at a lower P4.40/kWh.

“The immediate implementation of the PSA... will help alleviate the power outages in ZANECO’s franchise area. This will greatly benefit the electricity customers and local businesses,” the petitioners said.

ZANECO distributes electricity in the cities of Dipolog and Dapitan; as well as the municipalities of Godod, Gutalac, J. Dalaman, Katipunan, Kalawit, La Libertad, L. Postigon, Liloy, Labason, Manukan, Mutia, Pinan, Polanco, Rizal, Roxas, Salug S. Osmena, Siayan, Sibutad, Sindangan and Tampilisan -- all in the province of Zamboanga del Norte.

Meanwhile, MPC is a wholly-owned unit of Alsons, which is the listed holding firm of the Alcantara Group.

Alsons shares lost a centavo or 0.61% to end at P1.62 apiece yesterday. -- Claire-Ann Marie C. Feliciano source