Committed Power Projects Still Inadequate To Meet Future Demand

Despite assurance from Energy Secretary Carlos Jericho L. Petilla of capacity additions when supply conditions hit straining point in 2015, a list of the Department of Energy (DOE) revealed that there are actually only two committed power projects in the Luzon grid.

These are the coal-fired plants of South Luzon Thermal Energy Corporation (SLTEC) of Trans-Asia and Ayala group joint venture; and that of Southwest Luzon Power Generation Corporation of the Consunji group.

The initial 135-MW of the Putting Bato coal-fired facility of SLTEC is targeted on stream August this year, according to the energy department; while the 300-MW of the expanded Consunji coal plant in Calaca, Batangas is for commissioning around November this year for Unit 1 of 150MW; and the second unit of another 150MW by February 2015.

The Phinma Group-Ayala joint venture has programmed to expand the capacity of their coal plant by another 135MW and this is targeted on-line by 2015.

What has been teeming in the DOE’s list are “indicative power projects”, but these may not necessarily reach commercial development either due to major issues such as financing, political risks or hurdles on off-take agreements.

The roll of committed power projects for the Visayas grid has also been dismal, with only the 270-MW of Palm Thermal Consolidated Holdings Corporation taking off from blueprint to-date. The facility is due for commissioning in 2015.

Based on DOE’s forecast, Luzon and Visayas grids will be afflicted with supply tightening around 2015. If power projects cannot be firmed up on time, these two power grids faces prospects of brownouts.

For Mindanao, the only committed project logged by the energy department is the 300-MW Therma South Inc. coal plant of the Aboitiz group.  It will shore up the grid’s power supply starting 2015.

There are other Mindanao power facilities which project developers guaranteed to be on-line by 2015 and 2016, but these are not included yet in the DOE’s “committed projects’ list”. These include the 210-MW Sarangani coal-fired plant of the Alcantara group and the 405-MW plant of FDC Utilities Inc. of the Filinvest group.

Power industry players have been seeking concrete policy directions as well as updated and sensible energy blueprint that shall guide them in their investment plans.

And while the DOE leadership sounded off expectations that power plant projects will come on-line as they are needed,   what it missed in such assumption had been the lingering policy uncertainties which may discourage capital flows in the sector in the near term. (MMV)

Reference:


Velasco, M.M.(2014 February 6). Committed Power Projects Still Inadequate To Meet Future Demand. ManilaBulletin. Retrieved from http://www.mb.com.ph/committed-power-projects-still-inadequate-to-meet-future-demand/