Siemens eyes power generation venture

Updated May 7, 2018, 10:24 PM By Myrna M. Velasco

https://business.mb.com.ph/2018/05/07/siemens-eyes-power-generation-venture/

BERLIN, Germany – Siemens AG, which is generally into supplying turbines and turnkey contractor of energy plants, is eyeing this time to venture into power generation, specifically to serve the electricity needs of industrial zones in the Philippines.

In an interview here, Thomas Hagedorn, Siemens head of sales for Asia Pacific, has indicated that they are currently in talks with prospective partners on the proposed power plant venture.

“It will be different…it will have a captive market in the industrial zones,” he said, albeit emphasizing that one of the main factors they are keenly monitoring now is how the Philippine government will solve near-term gas supply hurdle.

He added “we’re having discussion with potential partners on how we can combine the gas technology that we have as a company and develop our own project…it could be a combined cycle for industrial zones.”

The planned power facility, Hagedorn noted, will be of smaller scale installation compared to the bigger installations that they have already done in the Philippines, primarily the gas-fired power plants of First Gen.

The Siemens executive did not divulge the parties they are currently in discussions with, although he hinted that some are “current partners” that they already have for power projects installed in the country.

Gas-fired generation is one major pitch that the Philippine government has been advancing especially for the industrial and economic zones that have traditionally relied on oil-fired power facilities in fully meeting their energy as well as industrial processes needs.

As culled from a number of studies, the industries’ shift to gas will be a cheaper option; while at the same time, they could also be trimming their carbon footprints.

In Luzon, most of the industrial parks are concentrated in the Laguna-Cavite-Batangas areas, the last province of which is key host to the country’s existing gas-fired power projects.

In Cavite, there are at least 37 industrial zones, based on the record of the Department of Energy; 21 in Laguna and 14 in Batangas.

Gas-fired power plant investments, at this point though, are all waiting for the government-underpinned infrastructure development of liquefied natural gas (LNG) supply chain, as a replacement to the Malampaya field at its anticipated gas production decline starting year 2022.

A gas industry framework has so far been crafted and is now being rolled into motion, but the biggest puzzle to the industry at this point is the ‘seriousness’ of both government and prospective investors on when they can set up the LNG terminal that will cater next to Philippine gas markets.