Aboitiz: New plants to give steady power to Mindanao, Cebu

CEBU, Philippines – AboitizPower Corp. inaugurated yesterday its 300-megawatt baseload power plant in Davao City, which is comparable to the coal plant it is building in Toledo City, Cebu.

The company’s officials said the Davao power plant will help solve the power supply crisis in Mindanao in the long-term.

“Following the project’s groundbreaking and construction, other private power producers have started to invest in Mindanao and we hope their entry in the next couple of years will eventually lead to a steady and reliable supply of power in this region,” said AboitizPower Chief Executive Officer Erramon Aboitiz.

Aboitiz said the baseload plant will be a reliable complement to Mindanao’s existing hydro power sources, adding, that renewable energy should continue to contribute a significant portion of the power supply.

Before the Davao plant, Mindanao sourced more than 50 percent of its power requirement from state-owned hydro power plants, resulting to seasonal power shortages in the region during dry months.

Because it is not dependent on the weather condition, the Davao baseload plant is able to continue generating much needed power even with Mindanao experiencing dry spells caused by El Niño.

The opening of a new coal-fired power plant started in September last year when the first unit of the 300 MW facility began commercial operations. The second unit is undergoing reliability tests and will be in full commercial operations by February 2016.

The power plant, which houses the country’s first coal dome, currently supplies baseload power to more than 20 electric cooperatives and distribution utilities in Mindanao.

Aboitiz explained the project indicates the positive impact of government reforms in the energy sector, citing the Electric Power Industry Reform Act (EPIRA) of 2001.

He said this law has transformed the county’s power industry positively from “a monopolized, politicized and highly subsidized structure into one that is competitive.”

President Benigno Aquino, the inauguration’s guest of honor, said the EPIRA law has allowed private investments to come in the power sector.

Aquino stressed the need to foster an environment that would encourage the private sector to make massive investments in energy, particularly in Mindanao.

Toledo power plant

In another development, Therma Visayas Inc. (TVI), a unit of AboitizPower, is also on track in the construction of its 340MW coal-fired power plant in Toledo City, Cebu, which will provide the Visayas grid reliable and cost-efficient baseload power supply by 2017.

Sebastian Lacson, chief operating officer of AboitizPower Coal Group, said the company is investing some P36 to P38 billion for the plant, scheduled to be completed by late 2017.

“This will be bigger than the 300MW plant here in Davao,” Lacson said yesterday.

Last year, TVI secured nearly P32 billion worth of loan to finance the construction of the Toledo coal plant partly.

The Therma Visayas plant will improve the Visayas’ energy mix through dependable baseload power, securing the energy needs of the region.

This coal project has two 170MW units.

This year, the publicly listed power firm is also set to inaugurate its 59MW solar farm in San Carlos City, Negros Occidental, which will become one of the biggest solar power plants in the country.

Aboitiz said the company seeks to achieve a balanced mix of renewable and non-renewable energy sources.

The power company is eyeing to increase its power capacity by 2,000MW in the next five years. It currently has an attributable power portfolio totaling about 2,400MW from coal, geothermal, hydro and oil-based sources. It has 915MW of renewable energy.

AboitizPower is the power generation and distribution arm of holding firm Aboitiz Equity Ventures.

Shares in AboitizPower closed at P40.90 per share yesterday, up 0.25 percent from the previous close of P40.50. — /JMO (FREEMAN)