Economy



By Victor V. Saulon, Sub-Editor


Fresh funds for 17,226-MW power plants sought




Posted on September 20, 2016


NEARLY 200 power developers are waiting to secure financing, or complete the regulatory permitting process, to break ground on their projects and potentially deliver around 17,226 megawatts (MW) of power from 2017 and beyond, latest data from the Department of Energy (DoE) show.

Of these “indicative” projects, coal power plants continue to dominate with 9,203 MW, or more than half of the total as of August. Wind farms are a distant second with 2,145.6 MW or 12.5%. Natural gas, hydropower and solar projects round out the top five. Diesel or oil-based, geothermal, biomass and battery storage facilities account for the smaller scale power projects.

Luzon cornered 67.4% of the total. Visayas and Mindanao accounted for 17.6% and 15%, respectively. The projects have a fair chance of not seeing completion if funding becomes a problem.

DoE officials did not immediately respond to a request for additional information. But in an earlier interview, Mario C. Marasigan, director of the DoE’s renewable energy management bureau, said the rules on renewable portfolio standards (RPS) might help in encouraging the development of more clean energy projects.

The DoE has released in June the draft rules on RPS, a market-based policy that requires distribution utilities to source a portion of their power supply from eligible renewable energy resources.

It listed nine renewable energy technologies from which mandated participants can choose from: biomass, waste-to-energy, wind, solar, run-of-river hydropower, impoundment-hydropower, ocean energy, hybrid systems and geothermal.

As it is, coal-fired power plants will continue to top the DoE’s list in terms of capacity. In Luzon, for instance, two new projects have been cleared to conduct the required studies on their impact on the electricity grid.

These are SMC Global Power Holdings Corp.’s 600-MW circulating fluidized bed coal-fired power plant in Brgy. Ibabang Polo in Pagbilao, Quezon, and Global Luzon Energy Development Corp.’s 670-MW plant in Brgys. Carisquis and Nalvo Sur in Luna, La Union.

The two are the only coal power plants in Luzon with a still undetermined date of commissioning and commercial operation. Manila Electric Co. (Meralco) has a pending application with the Energy Regulatory Commission for the purchase of 600 MW of electrical output from Global Luzon. In its filing in May, Meralco placed the plant’s operation date at around 2022.

The projects in a more advanced stage of development include SMC Consolidated Power Corp.’s 600-MW coal power plant in Limay, Bataan; St. Raphael Power Generation Corp.’s 700-MW plant in Calaca, Batangas; JG Summit Holdings, Inc.’s 600-MW plant in Batangas City; Redondo Peninsula Energy, Inc.’s 600-MW plant at the Subic Bay Freeport Zone; and Meralco PowerGen Corp.’s 1,200-MW plant in Atimonan, Quezon.

Of the five, only St. Raphael Power has been listed with its indicative cost -- at P58.3 billion. The others are still subject to financial discussions with possible lenders. SMC Consolidated Power’s funding status is “under planning and budget review” with project financing at a 70:30 debt-equity ratio.

In Mindanao, the biggest project is the 600-MW coal-fired power plant of SMC Consolidated Power in Brgy. Culaman in Malita, Davao del Sur. The developer has completed the project’s feasibility study and is negotiating for its financing arrangement.

The DoE’s list of “indicative” projects are on top of the “committed” projects that have already closed financing deals. These funded projects are expected to add around 6,261 MW to the country’s power supply.

As of 2015, the country has an installed capacity of 18,695 MW, of which 16,451 MW are classified as “dependable.” Coal-fired plants accounted for 31.5% of the total installed power.