Alternergy, Shell team up for wind project

MANILA, Philippines — Alternergy Holdings Corp. and Shell Overseas Investment B.V. are joining forces to explore the vast offshore wind potential in the country, with initial plans to develop a project in Occidental Mindoro that has a potential capacity of one gigawatt (GW).

Alternergy and Shell have obtained a wind energy service contract from the Department of Energy (DOE) to assess the feasibility of an offshore wind project in the Calavite Passage near Mindoro.

Alternergy chairman and former energy secretary Vince Pérez said the partnership combines the competencies and experiences of the two firms to boost the country’s renewable energy target.

“As part of any service contract application, we do have to submit a work plan and our work plan with the DOE is for the first five years, that is our plan. And there’s a lot of work to be done. Feasibility study, technical assessment, and of course, community engagement,” Perez said in a briefing yesterday.

“This is really the early stage. But we felt it’s an exciting part because we’re going to be leveraging off each other’s expertise and skills,” he said.

Perez said that based on the study by the World Bank, the northwest corner of Mindoro has a potential of up to five-GW of offshore wind capacity.

“We believe that we were somewhere about one gigawatt potential for that area. But again, this all will have to be finalized as we reach financial investment decision, but that particular Calavite passage, that area of the northwest corner of Mindoro offshore, the World Bank’s offshore study has said there’s about five gigawatts and maybe ours is only one gigawatt,” he said.

Aside from the Calavite passage wind power project, Alternergy and Shell are also looking at other offshore wind sites for possible development.

Shell, with 50 years of deep water offshore and over 20 years of offshore wind development experience, is bringing in its global track record, supply chain access, and technical expertise in developing large-scale bottom-fixed and floating offshore wind projects.

Shell has more than 2.2-GW of offshore wind capacity in operation and under construction and 9.2-GW in the funnel of potential projects across North America, Europe, the UK and Asia.

Shell general manager for offshore wind in Asia-Pacific Joe Nai said that typically, offshore wind development could take anywhere between six to 10 years “from finding the right location, having the consents, the permitting approved, until the point that you actually take final investment decision and construction can start.”

“So the speed of that, whether it will be five years or 10 years, really depends on clearly the regulatory framework that will evolve over time,” Nai said.

Perez, for his part, said that it would take no sooner than five years to develop an offshore wind project given the size of work that needs to be done.

“The Philippines’ offshore wind industry is promising and still at its nascent stage. The World Bank estimates that robust development of offshore wind could add 20 GW of installed capacity by 2040, accounting for 14 percent of the Philippines electricity needs and some $14 billion of value added to the economy,” he said.

“Alternergy looks forward to working with Shell and jointly shape with stakeholders the policies for a sustainable offshore wind industry in the Philippines,” Pérez said.

Energy Secretary Raphael Lotilla in a statement yesterday expressed his appreciation for the enthusiasm of the private sector in developing offshore wind projects in the country

Aside from the Alternergy and Shell partnership, the DOE said PetroGreen Energy Corp. (PGEC) also recently formed three special purpose vehicles for its offshore wind projects in Luzon and the Visayas together with its foreign partner, Copenhagen Energy (CE).

PGEC and CE, a Danish energy trading and developer of solar, onshore and offshore wind projects, plan to undertake projects with a total aggregate capacity of about four GW.