Published
By Myrna M. Velasco
Alegria, Cebu – A
Chinese energy firm will be injecting massive investments for planned two
coal-fired power projects of 1,500 megawatts aggregate capacity in Luzon and
Visayas grids, Energy Secretary Alfonso G. Cusi has declared to reporters in a
briefing on the sidelines of the production launch of the Alegria oil field
here.
With such scale of
power developments to be sponsored by China Energy Development Corporation for
projects utilizing ultra super critical (USC) clean coal technology, it is
anticipated that the investment cost could go as high as US$3.750 billion or a
mammoth equivalent of P195 billion.
Cusi said the Chinese
firm will put two units of 600-MW capacity for Luzon grid or total installation
of 1,200MW; and two units of 150MW or aggregate 300MW capacity for the Visayas
power investment.
The DOE chief noted
that China Energy executives were in the country Friday last week, and had
already started scouring through prospective sites in Cebu; and the same thing
for that planned development in Luzon. “They’re looking at several sites in
Luzon, but we don’t want to meddle in that anymore,” he stressed.
At this stage, Cusi
noted that the government has given its commitment that once investment
blueprints and timeframes are firmed up for these proposed projects, the
Department of Energy (DOE) will certify the Chinese firm’s ventures as energy
projects of national significance.
“I told them (China
Energy), I’ll guarantee you, one that we’re going to declare that as energy
project of national significance and we will finish the permitting – provided
that all documents are complete – we will finish the permitting in 30 days,”
the energy chief stressed.
Cusi said these power
projects are currently being discussed to be of ‘merchant market’ frame of
development – meaning, they have to seek out bilateral supply contracts with
interested off-takers (capacity buyers) or they shall be trading their
generated capacity at the Wholesale Electricity Spot Market.
“In order to increase
capacity, there must be investors willing to put up power plants that are
merchant,” Cusi said, adding that he does not prefer tying up Filipino
electricity consumers to long-term contracts, especially if these will have take-or-pay
clauses.
He expounded that the
Chinese energy firm’s interest in the Philippine power sector had been stirred
up during President Rodrigo Duterte’s state visit in China in 2016, but
investment decisions are just advancing now.
In the end, the energy
chief noted that “our objective is to drive down electricity tariffs, so how
can we drive down electricity rates? The answer is to increase capacity.”
He added that for the
Duterte administration, the main concern is capacity bulking up onward to years
2020, 2021 and 2022, so they will not be leaving a capacity of power supply
shortfalls – given also this administration’s push on massive infrastructure
build-up.
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