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By Francis Allan L. Angelo

AN independent power producer in Iloilo City is reaching out to prospective investors in the metropolis to address their projected energy requirement.

Engr. Henry Alcalde, project manager of the 164-megawatt coal-fired power plant of Global Business Power Corp. (GBPC), said they expect the demand in Panay to increase once their new plant operates next year.

“If you lower the cost of power, you encourage consumption. Lower prices will also attract businesses in our area. And once these investors come in, they will gradually use up the capacities of the new coal-fired power plant and the diesel plant. How fast this demand will be, we don’t know. But once the demand gets higher than our capacity, we will try to address that,” Alcalde said.

The coal-fired power plant will be operated by the Panay Energy Development Corp. (PEDC), a subsidiary of GBPC under the Metrobank Group. It is expected to go online in the last quarter of 2010.

The construction of the coal-fired power plant has resulted in renewed interests by investors to enter Iloilo City, particularly business processes outsourcing (BPO) firms.

A major investor expected to do business in the city is giant land developer Megaworld which bought the old Iloilo airport lot in Mandurriao district for P1.2 billion.

Megaworld is planning to develop the 54.5-hectare lot into a new business district with facilities such as hotels, convention center and BPO offices.

Industry sources said Megaworld would require around 20MW of power for its initial operations which is estimated to cost P1.5 billion.

Recently, the National Grid Corporation of the Philippines (NGCP), which handles the transmission side of the energy sector, made a positive projection on the energy needs in the Visayas grid.

Without factoring in the projected huge power demand from new growth areas such as the 300-hectare South Road Properties in Cebu City and the 54-hectare Megaworld property in Iloilo City, the NGCP said the next round of power supply problems in Cebu, Negros and Panay would be felt in 2018.

Alcalde said NGCP’s projections somehow jives with their own forecast, with Iloilo City suffering a 4-MW shortfall by 2014 on an annual demand growth of 3%. This does not include Megaworld’s demand. 

Engr. Gil Altamira, GBPC commercial manager, said they are reaching out to Megaworld to find out how much power they will need.

“Power plants don’t just pop up like mushrooms. We have to know the needs of the consumers so we can plan ahead of time, whether Engr. Alcalde will put up another unit.” Altamira said.

In Negros and Panay, load growth averaged 6.1% and 5.9%, respectively, this year. Panay’s load grew nearly 50% in 2007 only because the Panay Electric Co., Inc., sole electricity distributor in Iloilo City, was synchronized to the grid that year.

Growing demand has used up power reserves in the grid, leaving Cebu, Negros and Panay vulnerable to outages whenever a plant breaks down. Rotating brownouts have been the norm in these islands since summer.

Cebu’s actual peak demand this year reached 577 MW, while those of Negros and Panay hit 226 MW and 221 MW, respectively. Including Bohol and Leyte-Samar islands, the Visayas’ actual peak demand this year reached about 1,300 MW.

The Cebu-Negros-Panay grid gets 360 MW from the geothermal fields in Leyte, boosting total dependable capacity in the Visayas to 1,466 MW. Of the 360 MW, 200 MW goes to Cebu first and the balance is divided between Negros and Panay.

Cebu, Negros and Panay are expected to continue to experience power shortage until the first quarter of 2010, when the first of three 82-MW coal plants that Cebu Energy is building in Toledo City comes onstream.  (With reports from BusinessWorld)

By Francis Allan L. Angelo

POWER supply is one of the major reasons why Transcom, a European business processes outsourcing (BPO) firm, decided to open shop in Iloilo City.

Duncan H. Cowie, Transcom vice president and regional manager for North America and Asia Pacific, said electricity was a key factor in their decision to locate their fifth Philippine site in Iloilo City.

“I consider power as a critical element of our business. And with power you have networks and the other elements that supply your infrastructure. I’m very excited that Iloilo has a new power plant coming on soon. Did that (power plant) make a difference in our decision? Absolutely. It’s very important to us. It’s so important to have security of supply because my clients don’t really mind what’s happening where we are. They only want to know we keep working,” Cowie said.

Global Business Power Corp. (GBPC) is putting up a 164-megawatt coal-fired power plant at Brgy. Ingore, LaPaz, Iloilo City to address the power shortage not only in the city but in Western Visayas as well.

The power plant, which is expected to go online next year, will be operated by the Panay Energy Development Corp. under the GBPC umbrella and supply electricity to Region 6.

Cowie said they will initially employ more than 800 Ilonggos when they open next month.

“We plan to increase that capacity by 50% in the next six months. By March 2010, we expect to employ around 1,500 people and will increase to 2,000 by end of next year,” Cowie said.

Transcom will be located at the Amigo Plaza Mall on Iznart Street in downtown Iloilo City. The building has been accredited by the Philippine Economic Zone Authority to host BPO firms.

Cowie said the manpower potentials attracted Transcom to locate its fifth center in Iloilo City after Metro Manila and Bacolod City.

“We are not attracted by facilities or regions. We’re attracted by the people, the individuals,” Cowie said.

Cowie said they began hiring and training employees more than a month ago.

Chris Mason, Transcom vice president for implementation and solutions, said they were did not meet any difficulty in hiring employees, particularly for the management level posts.

Mason said the hiring rate in Metro Manila is 20-25% but in Iloilo it ranges from 40-45%.

“Your hiring rate in Iloilo is double the national rate which speaks a lot of your manpower potentials here. Hiring management level officers is usually the hardest process but here in Iloilo, we did not find it hard to get the people we need. It’s primarily because of the numerous universities in Iloilo,” Mason said.

As regards Transcom expansion, Iloilo City Mayor Jerry Treñas said he has been talking with several businessmen who are interested in putting up buildings for new and expanding BPO firms.

Cowie said North America and Asia Pacific are the fastest growing areas among Transcom’s five regional operation areas at 50% annually.

“Transcom’s global growth is around 20%. In North America and Asia, the fastest growing country is the Philippines. Our growth rate in Asia is more than 100% yearly. Two years ago, we only had 800 employees in the Philippines. This year, we already have more than 6,000 employees,” Cowie said.

Transcom’s main business areas are customer care, sales and support, credit management and additional customer related services. It also provides CRM consulting, translation and interpretation, and legal services. Its expertise is in a wide range of industry sectors including telecommunications, the financial industry, travel & leisure, utilities and retail/consumer goods. It has 75 sites in 29 countries worldwide.

By Francis Allan L. Angelo


THE Regional Development Council (RDC) in Western Visayas will take its chances in requesting the transfer of the 32-megawatt Power Barge 104 from Davao to Panay.


The RDC passed last week in Bacolod City a resolution urging President Gloria Arroyo to order the transfer of PB 104 to Panay to ease the acute power shortage in the island.


Presidential Assistant for Western Visayas Raul Banias confirmed the passage of the RDC resolution which will be endorsed to the Department of Energy.


But Banias had earlier said Davao will oppose the transfer of PB 104 to other areas “because they need it for their reserves.”


Data from the National Grid Corporation of the Philippines showed that Panay has a peak demand of 210MW but its supply is only 128MW or a shortage of 82MW.


The island draws power from the Cebu-Negros-Panay grid, Panay Power Corp. (PPC), 15MW modular generator sets in Capiz and two power barges stationed in the city and province of Iloilo.


Power supply in Panay was imperiled by the turnover of the Panay Diesel Power Plant (PDPP) in Iloilo to its new owner SPC Island Power Corp.


Power utilities raised fears of losing some 50MW if SPC does not operate the power plant because of needed rehabilitation works and lack of supply agreement contracts with electric cooperatives.


The problem was remedied when the Department of Energy agreed to subsidize the operation of PDPP for five months until SPC has signed supply contracts with Panay utilities.


Singapore-based SPC bought PDPP and the Bohol Diesel Power Plant for US$5.7 million last year. The plants were turned over to the company March 25.


Officials of distribution utilities and electric cooperatives said new power plants are needed to stabilize the energy situation of the island.


Engr. Randy Pastolero, special assistant to Panay Electric Co. (Peco) president and CEO Miguel Cacho, said the 164MW coal-fired power plant proposed by Global Business Power Corp. (GBPC) in LaPaz district will help stabilize power supply in Iloilo City and the rest of the province.


Peco is the sole power distributor in Iloilo City which has a peak demand of 75MW daily.


GBPC operates PPC which supplies 61MW to Iloilo City. The rest of the city’s energy requirement comes from the National Power Corp.

Ileco 1 general manager Wilfred Billena (right) and Ileco 2 president Dennis Ventilacion explain the purpose of the Panay Guimaras Power Consortium. (FAA)

Ileco 1 general manager Wilfred Billena (right) and Ileco 2 president Dennis Ventilacion explain the purpose of the Panay Guimaras Power Consortium. (FAA)


By Francis Allan L. Angelo


ELECTRIC cooperatives in Panay and Guimaras are racing against time in their search for power suppliers that can provide stable electricity by 2011.

The seven electric cooperatives in Panay-Guimaras said they are facing very serious power shortage with the looming expiration of their contract with the National Power Corp. (Napocor) after 2010.

This problem prompted the cooperatives to form the Panay Guimaras Power Consortium (PGPC) that will represent their interests, especially their increasing demand for electricity.

Engr. Wilfred Billena, Iloilo Electric Cooperative (Ileco) 1 general manager and interim consortium president, said they have been looking for power producers that can supply stable and cheap electricity to their franchise areas.

Billena yesterday led the opening of the bids submitted by five independent power producers in Panay-Guimaras areas.

Atty. Dennis Ventilacion, Ileco 2 president, said they cannot extend their power supply contract with Napocor because it is being privatized by the national government.

“They (Napocor) will not anymore renew the contract because of the privatization. We are now looking for other sources of electricity for our requirements from 2011 onwards,” Ventilacion said. 

Ventilacion said the Napocor contracts of Aklan and Capiz electric cooperatives will expire December this year “and they will have to look for their suppliers.”

“What they have now is a transition supply contract which will sustain the electricity supply to their consumers. The contract however is very limited because Napocor cannot anymore expand its capacity. This limited contract will mean a community cannot grow because of limited power supply,” Ventilacion added.

Billena said another problem besetting the cooperatives is the “assignability clause” which favors buyers of Napocor assets.

“Let us take for example the Dingle power plant. Under the assignability clause, the contract of a cooperative will be assigned to the new owner of the Dingle plant which might yield higher power rates because the plant is purely diesel. That is causing fear among the cooperatives,” Billena said.

Billena said another purpose of the consortium is to stabilize the price of electricity in Panay-Guimaras area once the proposed power plants are operational.

“To ascertain the future prices of electricity, we formed the consortium which will look and negotiate with power producers. We don’t want prices of electricity to be erratic that’s so we can plan our future growth.

Billena said they are looking for power producers that can provide electricity “24 hours a day, 7 days a week and 365 days a year.”

“We need a base plant considering the growth rate of the Panay-Guimaras area. That is why we are conducting the bidding so that we can get steady power supply at the cheapest cost,” he added.

A total of five power suppliers tendered their bids to PGPC including Trans-Asia Oil and the Global Business Power Corp.-DM Consunji Inc. consortium which will use coal to produce electricity.

The other bidders include firms using biomass and hydroelectric power but their bids may only be for peaking, not baseload.

Atty. Salvador Cabaluna, Ileco 1 director, said the PCPC members will evaluate the bids before they reconvene next month.

“We will evaluate the bids not just in terms of their prices but also their capability to provide stable electricity supply,” Cabaluna said.

June 2020

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