By Victor V. Saulon, Sub-Editor

PHILIPPINE company San Bernardino Ocean Power Corp. (SBOPC) is looking to source through official development assistance (ODA) a portion of the funds needed for its $25-million tidal energy project within the San Bernardino Strait.

“We’re trying to access ODA,” said Antonio A. Ver, president of H&WB Asia Pacific (Pte. Ltd.) Corp., the joint venture partner of France’s Sabella Societe par Actions Simplifie in SBOPC.

“The rest [of the funding is through] project finance. If we get ODA for $10 million, [the remaining] $15 million, that’s project finance,” he said in a phone interview on Monday.

Of the remaining $15 million, Mr. Ver said 70% will be sourced from debt and 30% from equity. For the equity portion, Filipino funds through H&WB will contribute 60%, while 40% will be from Sabella. Philippine laws require a 40% limit for foreign funds in energy projects.

The pioneering 1.5-megawatt (MW) project will use tidal in-stream energy conversion (TISEC) technology, which Mr. Ver said is adaptable in Philippines waters. TISEC produces electricity through tidal currents.

Capul island in Northern Samar province will be the main consumer of the reliable and clean ocean power sourced from San Bernardino Strait, which separates Luzon’s southern tip from Samar.

Capul is off-grid and falls under the small power utilities group (SPUG) of the National Power Corp. (Napocor). The government company currently supplies 60% of the island’s electricity at no more than eight hours a day. It relies on costly diesel generators to produce power.

Northern Samar Electric Cooperative (Norsamelco) will be the off-taker for the initial power plant harnessing the marine current resource. SBOPC had been awarded with three Ocean Power Service Contracts by Department of Energy on Oct. 30, 2013.

“We will be operating as a qualified third party (QTP),” said Mr. Ver, referring to an entity that provides electricity in remote and unviable areas that a franchised distribution utility is unable to serve.

“A qualified third party receives a share from the universal charge for missionary electrification,” he added about the payment uniformly collected from all power users.

Mr. Ver said the power plant is expandable to 3 MW because of a 1-MWh storage capacity. He said the service area is scalable to include Calintaan and Matnog in Sorsogon.

Unlike solar and wind energy, tidal currents are predictable, Mr. Ver said, thus ocean technology does not have intermittency issues.

He said his group had signed a memorandum of understanding with PNOC Renewables Corp. should the unit of state-led Philippine National Oil Co. decide to join the project.

“They’re interested to take equity,” he said. “It would still depend on the project’s internal rate of return, and equity internal rate of return.”

Mr. Ver said towards the end of 2018, the joint venture should have raised the $25 million to fund the project. During this period, the engineering, procurement and construction (EPC) package should have been completed, he said.

“After we go the EPC stage, that’s when we will be able to determine the total final project cost. From there we will determine how much is 70% debt and 30% equity,” he said, adding that it would also be at this time when PNOC Renewables should be able to assess the project’s viability.

“Our research work in San Bernardino dates back to as far as seven years ago. When we reached year three, we were already able to determine the resource. The technology that we chose is TISEC,” he said.

Sabella, a marine energy technology and engineering company, developed TISEC and is known for its successful project using its D-10 turbine in Fromveur Passage in energizing Ushant, an off-grid island in Brittany, France.

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