Zamboanga could tap 43MW more electricity to end blackouts

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Zamboanga City could tap as much as 43 megawatts (MW) that will be soon available from a single private power company. The projected power supply is more than enough to cover the current deficit of 35MW to satisfy the city’s 87MW electric demand.

But this power supply, which will be sourced from at least three subsidiaries of the Alcantara-led Alsons Consolidated Resources, Inc., could only be available depending on how fast the concern government agencies and the company as well as Zamboanga City Electric Cooperative (Zamcelco) can process the necessary papers for it to be delivered in this city, which is suffering from a daily eight-hour rotational blackouts.

Another caveat is how quick will be the rehabilitation process of the diesel-fed power plant of the Alsons in Iligan City, which the bulk of the power supply will be sourced from.

Local government and Zamcelco officials, as well as members of the business chambers, and civic groups met again on Friday to discuss the available options to immediately bring down the number of hours of the daily outages.

Among the possible sources of power supply that are part of the stopgap measures are as follows:

-       Iligan-based Mapalad Power Corp. for its diesel-fed power plant – 18MW

-       Soon-to-be Zamboanga City based Alsons-Aggreko for the joint venture modular generators set—10MW

-       Sarangani based Southern Philippine Power Corp. – 5MW

Archimedes B. Donato, business development manager of the Alsons Power group, said another source is the 10MW power supply, which is intended for the cement-maker Holcim Corporation based in Iligan City, will be temporarily diverted to Zamcelco.

Holcim has an existing power supply agreement with the Mapalad and is willing to give its contracted 10 MW to this city – 5MW in daytime and additional 5MW in the evening.

This will bring a total of 43MW supply for this city.

But Holcim will only allow the sharing scheme until September this year since by that time the operation of the cement factory will go on full-scale.

He also clarified that the delivery of the 18MW from Mapalad will be on the gradual basis depending on the progress of the rehabilitation process of its 18-engine diesel-fed power plant.

Despite the positive projection, what Alsons group can only guarantee for the meantime is a 7MW or more depending on the availability of the generated power supply on Mapalad in the month of May.

Mapalad can only deliver the entire 18MW for Zamcelco in September when the six-month rehabilitation process will be completed.

Alsons just recently acquired the 100MW Mapalad Power plant from the government of Iligan City after it put the plant on the auction bloc when its previous owner, state-owned National Power Corp. (NPC), failed to pay real property taxes to the city. The power plant has not been used for several years. 

Donato said he can only estimate the power supply on the Mapalad since it is the only one aside from the 85MW of the San Ramon Power Incorporated, which is also owned by Alsons, that Zamcelco has an existing power supply agreement with them.

The 100MW coal-fired power plant of the San Ramon Power Incorporated is yet to commence its construction in this city’s economic zone by the end of the year. The power plant will be operational in 2016.

For the time being, Donato said their company is helping the city to source its needed power supply being the host of two of Alsons’ major power plants – the existing 100MW diesel-fed Western Mindanao Power Corporation, and soon-to-be the San Ramon Power Incorporated.

In a separate interview, Zamcelco president Elbert C. Atilano said they are eyeing to sign two additional contracts for the Alsons-Aggreko and Southern Philippine Corp. within this week before the long holiday for it to be submitted to the Energy Regulatory Commission to set the rates and approval of the power deals.

“We really hope we can get these since the options are already available for us, compared to other distribution utilities in Mindanao which are still looking for other sources,” he said.

The contract between Zamcelco and Mapalad will run for three years, while discussions are still ongoing on how long Zamcelco will contract the Alsons-Aggreko, and Southern Philippines Power Corp.

Donato said Southern Philippines Power Corp. has an existing “exclusive” contract with the NPC to supply 50MW to the main grid. The power plant, however, could produce 55MW.

He said they needed special permits from the government to allow the 5MW excess to be used by Zamcelco, without violating its contract with the NPC.
In addition, he said, they are still also fine-tuning its rental agreement with the Singapore-based Aggreko, which they will source the modular generator sets. It will also take roughly four to six weeks to ship the generator sets as well as the construction of the facility in this city.
“Normally, this process [of getting necessary permits] could take at least two years but we hope we can finish this in just two weeks,” Mr. Donato said.
At present, Zamcelco is sourcing its power supply from the NPC as base load and Aboitiz-owned Therma Marine, Inc., which supply 18 MW.

Based on the power supply allocation this month, NPC is supposed to deliver at least 44MW but it could only provide 35MW as the aged old hydroelectric power plants, which supply the bulk of the electricity in Mindanao, are running only half of its full capacity or roughly below 500 MW due to repairs and the dry spell.

Therma Marine, meanwhile, is commissioned to provide this city with at least 18MW, but this also being reduced to only 13MW sine one of the power barges had been shut down for maintenance. For weeks, the barges of Therma Marine have been running on its full capacity due to the high demand.

Atilano said when all these power supplies would be available; the power rates in this city will increase to P11 per kilowatt-hour (kWh), or double almost from the existing rates.

However, he said the high rates would be temporary, which is expected to occur from May to July when Zamcelco will be using all the existing available options to get their power supply at the time when generation from NPC is on its lowest level.

George G. Ledesma, president of the Industrial Group of Zamboanga Inc., told BusinessWorld that power “conservation” is the key to bring down the cost of the power bill.

During a power summit held two weeks ago here, Energy secretary Carlos Jericho L. Petilla has said that the power being generated by the NPC’s hydropower plants is expected to dip further starting April due to summer season, and Mindanao does not have enough power plants to compensate the needed power supply.

By Darwin Wally T. Wee



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