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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.

Iloilo City at night. (Photo by Tara Yap)

Iloilo City at night. (Photo by Tara Yap)

By Francis Allan L. Angelo


ILOILO City and the rest of Panay Island are facing another debacle in the worsening power problems of the region.


Energy industry sources said SPC Power Corp., which bought the 146.5-megawatt Panay Diesel Power Plant (PDPP) operated by the National Power Corp. (Napocor) at Brgy. Tinocuan, Dingle, Iloilo, is hesitant to operate the plant because of the price of electricity.


The problem surfaced during the meeting Saturday of power industry stakeholders in Panay initiated by Dr. Raul Banias, presidential assistant for Western Visayas.


Banias said SPC will negotiate with electric cooperatives in Panay regarding the new price of electricity once the firm takes over PDPP operations March 25 from Napocor.


“As a merchant power producer, SPC will not be able to sell power at subsidized rates which Napocor offered to cooperatives. SPC will have to negotiate with the cooperatives regarding the price after the turnover of PDPP. The cooperatives will agree with Salcon’s price, well and good. If they cannot agree on the terms, SPC will not operate the plant and we will have bigger problems,” Banias said.


NPC sells electricity to cooperatives at around P2.80 per kilowatt-hour, which is cheap for power produced by a diesel-fired plant because of government subsidy.


Prevailing industry rates peg electricity from diesel-fired power plants at P8 to P9 per kWh depending on the fluctuations of oil prices in the world market and the peso-dollar exchange rate.


Engr. Edgar Mana-ay, who worked in the energy sector for more than 20 years, doubts if SPC will operate if the firm follows NPC’s subsidized rates.


“If the price is doubled or tripled up to P9 per kWh, maybe they (SPC) will continue the operation of the dingle diesel plant,” Mana-ay said.


If SPC does not run PDPP, Banias said Panay Island will lose some 50-60 megawatts of power, compounding the power woes of the island which is already reeling from 9-hour rotating brownouts.


The dilemma will trickle down to Iloilo City which draws 15MW from Napocor through its interconnection with Panay Electric Co. (Peco), the sole power distributor in the metropolis.


Mayor Jerry Treñas said Peco is only getting 8MW out of the 15MW it contracted from Napocor.


Iloilo City’s main source of power is Panay Power Corp. (PPC) whose mother company, Global Business Power Corp. (GBPC), plans to construct a 164-MW coal-fired power plant.


“As we all know, demand for power in Iloilo City increases during summer season. It’s a critical period for the city. If there are problems with GBPC’s plants, where shall we get power when PDPP is not running?” Banias said


Banias said they came up immediate solutions to SPC’s problems but he doubts if these are feasible.


“One, we can opt to delay the turnover of PDPP to SPC but this is not possible. Another option is to transfer Power Barge 104 from Davao City but residents and politicians there will certainly object,” he added.


Another solution is the deployment of 15 units of generator sets in Iloilo City which Napocor promised to Mayor Treñas.


Treñas will ask President Gloria Arroyo to expedite the transfer of the gen-sets, which have a total capacity of 15MW, and avert a power shortage in the metropolis.


The President will arrive in Iloilo City today to inaugurate the expansion of a call center.


Atty. Dennis Ventilacion, president of Iloilo Electric Cooperative-2, said their power purchase contracts with Napocor are good until December 2010.


Ventilacion said they expect SPC to assume Napocor’s contracts with the cooperatives “but the price would reflect the true cost of power.”


“We expect electricity rates to increase once SPC takes over PDPP operations. Another problem is when SPC withdraws some of the plant’s capacity from the market because SPC might not rehabilitate some of the engines for economic reasons,” Ventilacion said.


SPC Power Corp. (SPC), formerly Salcon Power Corp., won the bidding for the 146.5-megawatt (MW) Panay and 22-MW Bohol diesel power plants November 12, 2008.


The Power Sector Assets and Liabilities Management Corp. (PSALM) said SPC outbid two other firms after submitting the highest offer of $5.86 million for the two plants.


PSALM oversees the sale of government’s power assets which is mandated by the Electric Power Industry Reform Act (Epira).


The other bidders for PDPP and Bohol plant were Therma Power-Visayas, a Philippine corporation owned by Aboitiz Power Corp., and Trans-Asia Oil and Energy Development Corp. of Philippine Investment Management Inc. (Phinma).


Organized in 1994, SPC also won the contract for Napocor’s 203.8-MW Naga power plant complex in Cebu under a rehabilitation, operation, maintenance and management (ROMM) agreement.

By Francis Allan L. Angelo


PANAY Power Corp. (PPC), the sole power producer in Iloilo City, has reduced its generation charge by more than P4 since August 2008 because of successive oil price rollbacks in the world and domestic markets.


Based on data obtained by The Daily Guardian, PPC’s generation charge in January 2009 was pegged at P8.4119 per kilowatt-hour, down from P13.223/kWh in August 2008.


In September 2008, PPC reduced its generation charge to P12.805/kWh. It was further reduced to P12.106/kWh in October 2008.


In November 2008, PPC’s generation charge went down to P9.8737/kWh before plummeting to P8.5222/kWh December 2008.


Generation charge is the cost of producing energy charged by PPC to Panay Electric Co. (Peco), the sole power distributor in the city. Peco passes on the generation charge to its consumers.


PPC and Peco vowed late last year to lower power rates because of the oil price rollbacks.


PPC operates a 72-MW diesel-fired power plant located on a 40-hectare property at Brgy. Ingore, LaPaz, Iloilo City.


Global Business Power Corporation, mother company of PPC, plans to put up a 164-MW coal-fired power plant to augment the city’s power supply.


The coal-fired power plant is expected to further lower power rates in Iloilo City aside from providing stable power supply.

By Francis Allan L. Angelo

THE bid of Antique Governor Salvacion Z. Perez to seek for the cancellation of the environmental compliance certificate (ECC) to the proposed coal-fired power plant in Iloilo City is too late in the day.

In an interview over the weekly cable TV talk show Serbisyo Publiko Sunday hosted by City Councilor Perla Zulueta, Engr. Adrian Moncada, assistant vice president of Global Business Power Corp. (GBPC), said Perez should have asked for the cancellation of the ECC within 15 days after it was issued by the Department of Environment and Natural Resources (DENR).

Perez and four other Western Visayas governors – Isidro Zayco of Negros Occidental, Carlito Marquez of Aklan, Victor Tanco of Capiz and Felipe Hilan Nava of Guimaras – earlier wrote President Gloria Arroyo urging her to revoke the ECC issued to GBPC’s proposed coal-fired power plant at Brgy. Ingore, LaPaz, Iloilo City.

Moncada said the ECC was issued September 1 but the letter of the five governors only came out last week.

“If we refer to the DENR procedures, any protest to the issuance of the ECC must be done within 15 days after it was issued. I don’t think that the DENR will recall it at this time,” Moncada said.

Moncada said there could be political color to the anti-coal letter of the governors “but it is up to the President to act on this.”

But DENR Secretary Lito Atienza said they will not revoke the ECC to the coal-fired power plant project.

Atienza said President Arroyo forwarded the governors’ letter to his office for his action.

The DENR chief said the issues on the project’s effects on public health and environment have already been addressed in previous consultations and studies by their experts.

Atienza said the GBPC project will use clean coal technology and will solve the acute power problem of Iloilo and the rest of Panay.

Engr. Randy Pastolero of Panay Electric Co., the sole power distributor in Iloilo City, said the proposed coal-fired power plant will help lower electricity rates in the metropolis which is now pegged at P14 per kilowatt-hour.

“With the ECC of the coal plant already approved, there is now a pending reduction of the generation cost which is the prime factor in our power rates in Iloilo City,” Pastolero said.

Recently, Governors Zayco, Tanco and Marquez told Iloilo City Mayor Jerry Treñas hat they did not intend to interfere in the city’s affair.

The three governors also said that they have no objection to the project as long as public health and the environment are protected.

By Francis Allan L. Angelo

THE Department of Environment and Natural Resources (DENR) has set several conditions for the proponents of the 164-MW coal-fired power plant in Iloilo City to mitigate any adverse effects of the project on the community.

The conditions are spelled out in the environmental compliance certificate issued by DENR Secretary Jose “Lito” Atienza to Panay Power Corp. (PPC), proponent of the power plant which will be constructed on the PPC property at Brgy. Ingore, LaPaz district.

Atienza signed the ECC September 1, almost nine months after PPC, which is a subsidiary of Global Business Power Corp. (GBPC), submitted its environmental performance report and management plan (EPRMP) and environmental management plan (EMP).

The top condition set by the DENR is the continuous conduct of an “effective information, education and communication (IEC) program to educate stakeholders of the mitigating measures of the project.”

The IEC will also inform contractors, workers and local residents on the conditions set by the ECC and the environmental and human safety features of the project “for greater awareness, understanding and sustained acceptance” of the undertaking.

The IEC program will be implemented in the form of quarterly consultation with affected residents, farmers and fishpond owners.

Environmental training for the staff, contractors and workers will also be conducted to help them understand the mitigation, monitoring safety measures of the power plant.

The DENR also directed the project proponent to continuously implement the comprehensive social development program for the affected community. The program must be submitted to the Environmental Management Bureau (EMB) central and regional offices 30 days after receiving the ECC.

The proponent was also required to establish and maintain a 5-meter buffer zone planted with appropriate local species along the plant’s periphery.

Another condition is the installation of additional automatic sensor for monitoring temperature and other relevant parameters prior to the discharge of cooling water from the coal-fired power plant while maintaining the existing one.

As a general condition, the proposed plant shall conform with the provisions of Republic Act 6969 (Toxic Substances and Hazardous and Nuclear Wastes Control Act of 1990), RA 8749 (Clean Air Act of 1999), RA 9003 (Ecological Solid Waste Management Act) and RA 9275 (Clean Water Act of 2004).

The existing memorandum of agreement on the environmental guarantee fund (EGF), environmental monitoring fund (EMF) and multipartite monitoring team (MMT) shall be revised to include the coal-fired power plant.

The revisions will include the increase in EGF and EMF for the cleanup and monitoring of the plant operations.

Also, the action/management program for the protection and enhancement of the Jaro River and the existing mangroves/aroma stands in the area shall be implemented continuously and regular monitoring of said river to include aquatic biota shall be continuously undertaken. The results of the monitoring shall be submitted to the EMB central and regional offices.

Engr. Adrian Moncada, PPC assistant vice president, said they will install the display of the continuous emission monitoring system (CEMS) at the DENR regional office “so that the public can see that we follow the standards set by the law.”

“The CEMS will operate 24 hours, seven days a week and it will be open to the public. We want our operations to be transparent to the community,” Moncada said.

Moncada said they will also continue to help rehabilitate the Maasin watershed area and plant a buffer zone around the plant to address concerns about greenhouse gases.

January 2021

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