Conal to start building coal-fired power plant in Sarangani 1st quarter 2011

GENERAL SANTOS CITY (MindaNews/26 October)—Construction of the 200-megawatt coal-fired power plant in Maasim, Sarangani will start in the first quarter of next year to offset the projected power shortage in Mindanao by 2014, an official of the Alcantara-led Conal Holdings Corp. announced in a press briefing over the weekend.

will start construction of its $450-million coal-fired plant in the first quarter of 2011 to plug the power supply deficit expected to constantly hit Mindanao by 2014.

Joseph C. Nocos, Conal Holdings vice president, said the company can no longer afford to further delay the project because “the power outlook for Mindanao is not good if no new power generation facility will go on stream.

Nocos said the permit for the $450-millionplant is already being worked out and the project is moving into its detailed design and engineering phase.

Conal Holdings, which is joint venture between the Alcantara group and the Electricity Generating Public Co., Thailand’s largest power producer, has acquired the environmental compliance certificate from the Department of Environment and Natural Resources.

Available power capacity in Mindanao stood at 1,331 MW as of Sunday, the website of the National Grid Corporation of the Philippines showed.

Pegging a conservative annual demand growth of 3%, Nocos said “that shortage of power will be felt in 2011 and likely to happen by 2014” across the Southern Philippines if no new power generation facilities will rise.

The projection does not take into account the entry of major industries such as mining, shipyard and steel mills, he added.

He also warned consumers to brace for a double whammy– higher power rates that are “reflective of the true cost of power in Mindanao” and power supply lack with no new power generation facility on stream by then.

Currently, the South Cotabato Electric Cooperative II charges less than P6 per kilowatt-hour to its consumers in the city, the whole of Sarangani province and parts of South Cotabato province.

Nocos said the higher power rates would take a toll on consumers with the privatization of National Power Corporation’s power plants as required by the Electric Power Industry Reform Act of 2001 (Republic Act 9136).

Once the NPC privatizes its Agus and Pulangi hydropower plants, it will lead to some increase in power costs as the investors will have to recover their investment, he explained.

More than half of Mindanao’s power requirement comes from the hydropower plants, thus consumers in the area enjoy lower power rates compared to Luzon and the Visayas.

Secretary Luwalhati R. Antonino, chair of the Mindanao Development Authority, said the government has not arrived on a firm decision on whether to go ahead with the privatization of the hydropower plants.

She cited the position of the Philippine Chamber of Commerce and Industry against the privatization of the hydropower plants as reason for being non-committal in having the facilities under private hands.

Antonino said that Congress is still studying the proposal to amend the Epira over fears raised by the business sector.

Nocos said that once their coal-fired power plant goes on stream, consumers in the service area of SOCOTECO II will enjoy at least a peso of reduction as the company will directly connect to the transmission facilities of the cooperative.

He said the plant, which is staunchly opposed by the local Catholic Church and the environment groups on concerns for the human health and the environment, can be developed in three to five years.

He added the firm is willing to dialogue with the Diocese of Marbel headed by Bishop Dinualdo D. Gutierrez to explain the project to the religious sector. (MindaNews)