CONSUNJI-LED DMCI Power Corp. is conducting testing and commissioning of its 15-megawatt (MW) coal-fired power plant in Masbate to replace its existing facility in the off-grid island in Bicol that runs on diesel fuel.

“[It’s in the] finishing stages of commissioning,” Nestor D. Dadivas, its president, told reporters, adding that the turnover is expected on the last week of December. “The turnover is on the last week of December.”

He said the tariff to be imposed on consumers would be lower as the plant runs on coal at P2 per kilowatt-hour (kWh), which is cheaper than diesel at P10 per kWh.

“The government will save about P700 million a year,” Isidro A. Consunji, president and chief executive officer of the company’s parent DMCI Holdings, Inc., told reporters.

The savings will be a reduction on the universal charge for missionary electrification (UCME), which is collected from consumers to subsidize the cost of energizing off-grid areas, Mr. Consunji said.

Mr. Dadivas said the power plant would start contributing to the company’s revenues next year at an amount that depends on the final tariff to be granted by the regulator. He added that the company was also awaiting the completion of a 69-kilovolt transmission line that will allow the conveyance of energy.

“Ang commitment nila (Their commitment is) before year-end,” he said, referring to the transmission line as promised by the National Power Corp.

He said the completion of the power plant could result in raising the energy demand in the province, which historically grows by 10% each year. With the improved power transmission capacity, the appetite of consumers to buy appliances could rise, he said.

The off-taker of the power plant’s output is Masbate’s electric cooperative.

Next to Masbate, the company expects to start building a similar 15-MW coal-fired power plant in Palawan. The plant will also displace a more expensive diesel-fired power facility.

“Meron na rin kaming EPNS (energy project of national significance) sa Palawan,” he said, referring to the certification issued by the Department of Energy that eases the permitting process for crucial projects.

“We hope to finalize negotiations with the winning bidder [for engineering, procurement and construction, or EPC],” Mr. Dadivas said.

The power plant is expected to be completed 22 months after the EPC award. Two contractors have been short-listed for the project. The plant will supply power to Palawan’s electric cooperative.

Mr. Consunji said the two power plants can burn coconut husk as alternative to coal. Initial theoretical estimate placed the biomass component of the dual-fed plant as contributing 20% of its output or 80 tons of husks a day.

Mr. Dadivas said the Masbate plant will bring DMCI Power’s installed capacity at 130 MW, although next year the net capacity should be at about 118 MW because of the retirement of old facilities. — Victor V. Saulon

RELATED ARTICLESMORE FROM AUTHOR