Power supply contract for coal-fired power plant inked
Panay Power Corporation (PPC), Panay Energy Development Corporation (PEDC), and Panay Electric Company (Peco) yesterday signed a memorandum of agreement (MOA) to formally seal the power supply contract for the coal-fired power plant which is currently undergoing construction at Brgy. Ingore, La Paz district.
The MOA amended the existing Electric Power Purchase Agreement (EPPA) of PPC and Peco signed in 1997. The said EPPA has a remaining term of 13 years.
The EPPA was amended in preparation for the operation of the coal-fired power plant by the last quarter of 2010. In the amended EPPA, Peco's base load will already come from PEDC's coal-fired power plant. Currently, Peco uses as its base load power generated by PPC's diesel plants.
PEDC is a subsidiary of Global Business Power Corporation (GBPC) which will undertake the operation of the 164 megawatt coal-fired power plant.
In a briefing before the MOA signing, Engr. Gil Altamira, manager for commercial operations of GBPC, said that the backfilling at the site of the coal-fired power plant is already 80% completed. He said piling works will commence soon as concrete piles have already arrived.
Altamira said based on their projection the first unit of the coal fired power plant (82 MW) will start operation by July or August next year.
“We want you to witness the signing of a document that will provide Iloilo City a competitive edge in investment opportunities, both in commerce and industry,” said Engr. Adrian Moncada, Assistant Vice President of GBPC.
Moncada said with the operation of the coal-fired power plant there will be a reduction in generation rate estimated from P3.25 to P3.75 compared to the current rate of almost P8.00.
He said the lowered generation rate would result to lower electric bills of consumers.
Moncada added, aside from lower power rate, the coal-fired power plant would also ensure reliable power supply in the city which is currently beset with frequent power interruptions.
City Mayor Jerry Treñas dubbed the MOA signing as a historic occasion for the city.
“This is meant to address not only the problem on the price of electricity but will also give us sustainable power,” the mayor said.
Treñas noted that having a sustainable power supply could attract many investors to the city which would mean more employment opportunities for the people especially the fresh graduates.
“My only regret is that it will not happen during my term but at least we are assured that by 2010 we have sustainable power at a lower cost,” Treñas added.
Altamira stressed that the completion of the coal-fired power plant by next year is just timely as the island of Panay is having a power supply deficiency of 59 megawatts almost everyday.
“What we have is a precarious power supply and demand scenario which needs to be addressed as soon as possible,” Altamira said.