NPC ready to provide power on peak hours but on higher cost
Good news: The National Power Corporation (NPC) acceded to the request of the Panay Electric Company Inc. (Peco) to buy power on an as available basis anytime of the day from any of NPC's power plants.
Bad news: It will be sold on a higher cost.
In a letter sent by NPC President Cyril de Callar to Peco's Senior Vice President for Operation Edmund Afzelius, the NPC is amenable to provide Peco a maximum of 10 megawatts power supply during the day, from 10:00 am to 4:00 pm "on a firm basis but at replacement power rates according to the production costs of diesel power plants in Panay Island."
Callar's letter was in response to the request of Afzelius to amend the Non-firm Power Supply Agreement since the available capacity for sale to them was limited to off-peak hours. The NPC provided power to Peco last August 14 during off-peak hours.
The NPC based their load capacity and availability in the contract they have signed with Peco. Part of the contract states that "this agreement is for the sale of NPC unutilized electric energy from its Geothermal Power Plants in Leyte and Negros Oriental on as available basis."
With such provision in the contract, this was interpreted to mean that when NPC's diesel plants start to cut in at around 8:00 am, the geothermal plants are no longer available. "In which case, Peco is not allowed to avail power from your diesel plants after 8:00 am and before 11:00 pm," Afzelius wrote.
Callar added that they will continue to abide with existing NPC and Peco's Non-Firm Power Supply Arrangement providing Peco with power during off-peak hours. He said the scheme will also help Peco to lower its power costs to its consumers.
The rate of power during off-peak hours and peak hours vary. The power provided by NPC to Peco during off-peak hours is cheaper as it comes from geothermal sources. The power during peak hours comes from diesel plants in Panay and is expensive. Power during off-peak hours is more than 3 pesos, said Treñas.
Callar also suggested that Peco should secure an approval from the Energy Regulatory Commission for the 5-10 megawatts firm power supply contract with the NPC as long term solution. This will also help the Peco to recover such rates from customers.
Peco can coordinate with Dr. Eduardo Eroy, vice president and head of NPC Visayas and Transco-Visayas should they agree with the terms and conditions of the NPC, said Callar.
Meanwhile, Mayor Jerry Treñas said he will discuss the matter to Callar as he leaves for Manila today.
He believes the scheme will not reduce the power shortage and power costs in Iloilo City. "It will not make any difference," the mayor said.