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By Francis Allan L. Angelo

A CONSORTIUM of electric cooperatives in Panay Island will begin negotiations with an independent power producer to purchase electricity from a 164-megawatt coal-fired power plant based in Iloilo City.

The negotiation kicked off with the signing of a memorandum of agreement between the Panay Power Supply Consortium (PPSC) and Panay Energy Development Corporation (PEDC).

PEDC, a subsidiary of Global Business Power Corp. (GBPC) under the Metrobank group, will operate the coal-fired power plant being constructed at Brgy. Ingore in LaPaz, Iloilo City.

The PPSC is composed of Aklan Electric Cooperative, Antique Electric Cooperative, Capiz Electric Cooperative and Iloilo Electric Cooperatives (Ileco) 1, 2 and 3.

The negotiation is seen to culminate in a 25-year electric power purchase agreement (EPPA) between PEDC and PPSC member cooperatives.

Adrian Moncada, GBPC assistant vice president for commercial operations, said once they have concluded the negotiations, the EPPA will be submitted to the Energy Regulatory Commission for approval.

The PPSC was conceptualized in 2008 to address the worsening electricity shortage in Panay.

The looming expiration of the cooperatives’ power supply contracts with the National Power Corp., which is presently being privatized, in 2010 also prompted PPSC to look for potential suppliers.

The coal-fired power plant is expected to be operational in the last quarter of 2010. It is composed of two units each with a capacity to generate 82MW. The plant has a net production of 144MW

Engr. Wilfred Billena, Ileco 1 general manager and PPSC president, said they bidded out a total of 72MW for their power requirements starting 2011.

A total of 36MW was awarded to two renewable energy companies – Global Green Power and Asea One – while the remaining 36MW was awarded to GBPC.

GBPC has set aside 72MW, or 75% of the coal-fired power plant’s net generation for Iloilo City’s electricity needs.

The remaining 36MW of the coal plant will be allocated to 5 electric cooperatives in Negros Occidental and Oriental.

Engr. Gil Altamira, GBPC commercial operations manager, said their price per kilowatt-hour will be lower than the ERC-approved rate of P4.30/kWh in the EPPA between Central Negros Cooperative (Ceneco) and Korean Electric Power Corp., (Kepco) which will also operate a coal-fired power plant in Cebu.

“We will try to reduce our price from that of the Ceneco-Kepco deal. The advantage of the GBPC-PEDC plant is that it is embedded in Panay Island which could save us from additional transmission cost,” Altamira said.

Billena said their contract with GBPC and other suppliers might not be enough because of their unpredictable consumer growth.

“Our consumption is pegged at 30MW but sometimes we are surprised because we hit 32MW on certain days. The supply instability in the Visayas grid makes it hard for us to predict our growth. When these new capacities operate, we expect our connections to increase. Apparently, the supply that we are about to contract might not be enough,” Billena said.

Billena said an embedded power plant in Panay is advantageous compared to sources outside the island because it is “more stable and cooperatives here will be given priority.”

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By Francis Allan L. Angelo

 

TOWNS in two Iloilo electric cooperatives suffered power blackouts because generation and distribution problems.

 

Engr. Wilfred Billena, Iloilo Electric Cooperative (Ileco) 1 general manager, said their franchise area is suffering from rotating brownouts since Sunday after the Palinpinon Geothermal Plant in Negros and the 100-megawatt thermal power plant in Cebu.

 

Billena said they need 26MW to sustain power supply in their franchise areas “but because the two plants broke down, we had no choice but to resort to rotational brownouts.”

 

“My phone was swamped with text messages and calls from consumers who complained of prolonged brownouts. I told them that problem lies with the National Power Corp. because we only distribute power they produce,” Billena said.

 

Billena said local officials called him because the brownout occurred during their fiestas and other special events.

 

“Wakes and hospital operations were also disrupted by the brownouts. The Katamnan Festival of Oton was postponed late in the evening because there was no power. It’s embarrassing,” Billena said.

 

Billena said they expect the power situation in Iloilo and Panay to ease up in 2011 when the 164MW coal-fired power plant of Global Business Power Corp. goes online.

 

Based on data from the National Grid Corporation of the Philippines last April 16, Panay’s total demand is 208MW but its capacity is only 140MW, a deficit of 68MW.

 

“If only we did not drive earlier investors in power plants, we would not be suffering this problem. We really need a baseload plant, regardless of the fuel, that will run for 24 hours, 7 days a week so we will not suffer from brownouts,” he added.

 

BUSTED SUBSTATION

 

Five towns in northern Iloilo also suffered power blackout after the substation of Ileco 3 exploded for still unknown cause.

 

Engr. Antonio Lazaraga of Ileco 3 said the towns of Sara, Ajuy, Lemery, San Dionisio, and Concepcion have no electricity.  

 

Lazaraga said they are trying to fix the substation, which was bought and installed in 1986, and restore power supply in five days.

 

Reports surfaced that the substation was bombed. The Ileco 3 management has sought the help of the PNP 608th Iloilo Provincial Mobile Group to investigate the incident.

 

Lazaraga said the substation may have exploded because it is already old. 

By Francis Allan L. Angelo

 

THE new president of an influential business organization in the country vowed to help the city and province of Iloilo rise to economic prominence provided that problems on power and water shortage are solved first.

 

Alfonso Uy, the newly elected president of the Federation of Filipino Chinese Chambers of Commerce and Industry, Inc. (FFCCCII), said the two problems besetting Iloilo must be solved first to encourage investors to come to the city and the province.

 

“Many investors are interested in Iloilo but they are hesitant because of our unstable and expensive power and water supplies,” Uy said in a phone interview with The Daily Guardian Monday.

 

Uy was elected FFCCCII president April 6 during the federation’s 27th Biennial Convention at the SMX Convention Center at the Mall of Asia in Pasay City. He is the first Visayan president of the federation.

 

FFCCCII is composed of 170 member organizations nationwide and one of the most influential business organization in the Philippines today.

 

Uy also chairs the Iloilo Economic Development Foundation (ILEDF) which promotes the city and province of Iloilo as the future investment site in the country.

 

Uy said they are pushing for projects which are “fundamentally needed to promote Iloilo.”

 

“One good news is the construction of the coal-fired power plant of the Global Business Power Corp. (GBPC). We expect the price and supply of electricity in the city and province to stabilize once the project is completed and goes online between October and November 2010,” Uy said.

 

Engr. Adrian Moncada, GBPC vice president for commercial operations, told the Iloilo business community in a forum on power issues last Friday that the 164-megawatt power plant will be completed in the last quarter of 2010.

 

“Landfill development is currently ongoing in the 24-hectare site and actual construction will start by July or August this year,” Moncada said. 

 

As regards water supply, Uy said they are looking at the long-term supply that will cater to big investments in Iloilo.

 

He cited the integrated irrigation system project of the National Irrigation Administration (NIA) which got the support of the World Bank.

 

The NIA project will construct a water dam in Lambunao which has capacity of 360 million cubic meters. The project will also create an irrigation canal system.

 

“The integrated irrigation project will irrigate our farmlands the whole year and supply water to Iloilo City and the towns along the distribution lines. It will mean increase in agricultural production and stable water supply,” Uy said.

 

ILEDF has requested NIA to revisit the study on the integrated irrigation project to find out if it’s still feasible.

 

“We have to revalidate the data of the study to find out if it’s still feasible nowadays to address the water shortage,” Uy said.

 

Uy said solving the power and water problems are the key to Iloilo’s prominence in “sunshine industries” such as the business processes outsourcing sector.

 

“If we solve these concerns, it would be easy to attract members of the business community to invest in Iloilo,” he added.

 

Two years ago, a major call center investor moved to Bacolod City because of high power rates in Iloilo City.

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.

By Francis Allan L. Angelo

 

TOP energy officials and stakeholders confirmed the power shortage besetting Visayas region, particularly Panay and Negros Occidental.

 

The energy scenario in the region and the necessary actions that must be taken to avert the shortage was presented during the energy summit initiated by the Department of Energy at the Cebu Waterfront Hotel January 14-16.

 

The summit was attended by officials of the National Power Corp. (NPC), National Transmission Corp. (Transco), Philippine Electricity Market Corp. (PEMC), independent power producers, distribution utilities and other stakeholders in the energy industry.

 

In a summit brief obtained by The Daily Guardian, Crispin “Bingbong” Lamayan, Transco assistant vice president for System Operations-Visayas, confirmed the shortage of reserved electricity in the Cebu-Negros-Panay (CNP) power grid.

 

As of December 17, 2008, 7pm, Panay Island lacks 53 megawatts (MW) while Negros is short by 57MW.

 

Lamayan said Panay is suffering from rotating brownouts ranging from 30 minutes to 9 hours. Negros needs 240MW by 2010 on top of its present capacity of 109MW.

 

The Transco official also said that Cebu province lacks 291MW with Mactan Island accounting for about 65MW while the power deficit in Bohol reached 38.70MW.

 

The Leyte-Samar enjoys a 352.70MW surplus but it is not enough to fill in the 439.7MW total power deficit of Visayas region.

 

The supply coming from geothermal plants in Leyte, where the grid also gets its power needs, is also decreasing, Lamayan said in several news items last year.

 

The power crisis is attributed to the burgeoning business climate in the region while power sources remained the same.

 

What needs to be done to avert the power crisis by 2010?

 

Mario Pangilinan, PEMC vice president for market operations, presented the Supply Augmentation Plan which is being finalized and will be operational within the period the CNP grid is expected to suffer low electricity supply. This crisis period includes the present until 2010 when new power plants in Visayas are expected to be operational.

 

The summit also came up with action plans based on the needs and peculiarities of each island in Visayas.

 

In Panay, energy officials proposed the deployment of more NPC modular units (generator sets) to augment the island’s power supply. Another solution presented was the uprating of the Negros-Panay transmission by middle of 2010.

 

Another proposal is the possibility of granting renewable energy initiatives before the implementing rules and regulations of Republic Act 9513 (Renewable Energy Law) are finalized.

 

Ilonggo business executive Rex Drilon, president of the Iloilo Local Economic Development Foundation who attended the summit, called for the declaration of a state of emergency in Panay given its power shortage problem.

 

For Negros, the development of the biomass market was encouraged.

 

It was also proposed that incentives will be given to renewable energy investors before the implementation of RA 9513. The rehabilitation of existing power plants in Negros must also be covered by the said incentives.

 

The consortium of the five electric cooperatives in Western Visayas is also seen to develop the subtransmission line and loop and improve electricity supply.

By Francis Allan L. Angelo

LOOMING power and water crises are bugging the Iloilo City government this holiday season.

For one, the National Power Corp. (Napocor) has yet to install the 15 units of modular diesel power generator in Iloilo City to augment the metropolis’ electricity. With this, Mayor Jerry Treñas said he is apprehensive power blackouts will occur when the city celebrates Christmas and New Year.

Last year, the whole metropolis was plunged in darkness but Panay Electric Co. (Peco) and Panay Power Corp. said the outages were man-made and technical in nature.

The generator sets supposed to be installed before December in a Peco-owned lot at Brgy. Bolilao, Mandurriao are part of Napocor’s commitment to the city to supply 15 megawatts of power through a direct interconnection agreement with Peco mandated by the Energy Regulatory Commission.

Early this year, Napocor installed the first batch of the same 15 generator sets at the Capiz Electric Cooperative compound in Panit-an, Capiz to augment power supply in the province and parts of northern Iloilo.

This is in response to the order of President Gloria Macapagal-Arroyo for the Department of Energy and Napocor to solve the acute power shortage in Panay, especially in Iloilo City.

Meanwhile, Panay Power Corp. continues as the main supplier of electricity to Iloilo City which has currently a peak demand of 76MW. This December, the city’s power demand may exceed 90MW.

Aside from power shortage, the City government is also grappling with acute water shortage. The problem is more pronounced in the 11 Waterfront barangays who were supposed to meet the Metro Iloilo Water District (MIWD) board of directors around 2pm Thursday. The meeting did not push through as the punong barangays walked out after an hour of waiting for the directors to meet them.

The meeting was aimed at resolving the water shortage at the Waterfront whose residents are now restive over MIWD’s minimum fee of P159. Residents said no water comes out of their faucets but they continue to pay the water firm.

Punong Barangay Roberto Divinagracia said Waterfront barangays are forced to buy water by the gallons from private sources.

Divinagracia, president of the Association of Barangay Captains-Iloilo City proper district, said they will make a position letter asking MIWD to waive the minimum fee until normal water supply returns to the waterfront area.

BILLING POLICY

In a news release issued yesterday, the MIWD issued a new billing policy on areas that have no water supply.

In consonance with the resolution passed by the MIWD board of directors the other day. the water firm decided to condone the payment of water bills in some MIWD service areas experiencing water shortage.

Engr. Edgar Calasara, MIWD officer-in-charge, said water bills which have zero to five cubic meter (0-5cu. m.) consumption reading shall not be delivered anymore provided that the water district’s engineering department certifies that such area has no water for the period.

Water bills that were delivered to concessionaires shall not be paid provided that said billing bears 0-5 cu. m. consumption reading and are certified by the Engineering Department as within an area without water supply for the period.

If the consumer has paid the bill in any authorized MIWD collecting banks or payment outlets, the amount shall be retained and considered advanced payment for future water bills.

Calasara said the policies shall be effective November 1 to December 31, 2008, unless extended by another board resolution.

He, however, said that consumers in areas where there is a steady supply of water are obliged to pay their monthly water bills.

Calasara also assured the consumers that MIWD is doing everything to fast track the permanent repair of its damaged pipe and the ongoing cleaning of its reservoir in order to restore water in areas where there is intermittent supply, particularly in Jaro and the Waterfront.

 

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