Davao leaders differ stand on coal power plant issue

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Wednesday, October 6, 2010

DAVAO CITY -- Aboitiz Power Corporation may have convinced Vice Mayor Rodrigo Duterte to support its plan to construct a 200 megawatts coal-fired power plant in this city next year, but not his daughter Mayor Sara Duterte.

The mayor had said earlier that she is not inclined to support such project because the coal-fired power plant has long-term effects on the environment.

But the older Duterte expressed his support to the project on Tuesday after hearing the presentation conducted by Erramon Aboitiz, CEO and president of Aboitiz & Co., and Aboitiz Equity Ventures Inc., before City Council members.


Aboitiz is proposing a USD$400-million coal-fired power plant to be constructed in the city within the next three to four years starting 2011.

"Our target capacity is at 200 megawatts, in estimate this would cost at about USD$400-million. There's no location yet where this will be (built) but we are looking at sites whether it's south or north of Davao City near the shoreline," Aboitiz said.

He said Davao Light and Power Company has long made a projection that from 2010 to 2014, the city would have a deficiency of 484-megawatt per hour.

Aboitiz said it takes three to four years to construct a power plant. Thus, he said, it is high time that the city develops a viable source of energy as soon as possible.

During his presentation, Aboitiz mentioned that the coal, which will fuel operation of the power plant, will be delivered through boat from Indonesia.
The city is a convenient location for setting up a coal plant, he said.

"We think it makes sense to be in Davao. Davao is basically the largest user of power in Mindanao, as a city. We think having it in Davao would improve the reliability and security of power in Davao and in Mindanao. We also think having it here would reduce cost of power in Davao. I guess all the other benefits that go with the power like business taxes, employment would also improve here," he said.

Aboitiz said to improve the power source in Mindanao, high generating power plants should be constructed while barges, which use diesel and hydropower plants should be thought of "as a reserve or temporary solutions" during power shortages.

"For a long term goal, we have to build power plants in Mindanao. Barges for me are interim, stop gap measures. Some of the barges had their use as a reserve but to become a base load plant, I think we have to build a new base load plant. I don't think we have to depend on other forms of generation that are really meant to be reserves or temporary solutions," he said.

He also said that he believes coal plant is the best option as this will not be dependent on rainfall and water levels.

In the same presentation, Aboitiz said the power cost in the city would also be reduced as consumers from the city need not pay for transmission costs since the power plant is set up here. "It would reduce the power rate to 70 centavos," he said.

Aboitiz also answered to queries on the environmental implications of a coal-fired power plant in the city, to which he assured the coal plant would be "clean".

"The coal plant (set for construction here) would be designed to use a clean coal technology. There would be no smoke. It would be a covered coal yard. It wouldn't be the type wherein you'd see smoke coming out of the plant so the dust would not be blown out of it. It will be power that is responsible," Aboitiz said.

He also assured that the power plant would "abide by environmental policies."

Clean coal?

Clean coal technology, according to the Wikipedia, is a term used to describe technologies being developed that aim to reduce the environmental impact of coal energy generation. It implies that it is possible to make coal a fuel source that is free of (or very low in) carbon dioxide emissions and other pollutant emissions.

Some of the techniques that would be used to accomplish this include chemically washing minerals and impurities from the coal, gasification, treating the flue gases with steam to remove sulfur dioxide, carbon capture and storage technologies to capture the carbon dioxide from the flue gas and dewatering lower rank coals (brown coals) to improve the calorific value, and thus the efficiency of the conversion into electricity.

Earlier, Mayor Duterte met with the Aboitiz group to discuss their proposal to setup a coal-fired plant in the city.

"Giingnan pud nako sila (I also told them) you talk to the City Council. You talk to the vice mayor regarding your project. You present your project to the public," the mayor said.

The vice mayor, who earlier supported Aboitiz' proposal for a hydropower plant, also expressed his support to a coal-fired power plant. "Ako I am endorsing it," Vice Mayor Duterte said in an interview.

The vice mayor reiterated his stand in welcoming initiatives to add to the power grid as Mindanao is dependent on hydropower plants as well as his perception that the city needs more energy to attract more investors.

"We're at a rotation na nga eh. It's bound to happen that we'll fall short in energy. They're now discussing it with the city councilors. A power plant takes three to four years to be completed. We're not so much concerned on that but rather will it be done on the right way, whether there will be mitigation," he said.

Duterte said the discussion will be endorsed through a resolution to the city council for formal deliberation.

This was not the first time that the two top officials of the city had differing stance. The Tamugan River hydroelectric plant that the Aboitiz Group was also proposing earned strong opposition from the mayor and a welcoming support from the vice mayor.

Both the coal-fired power plant and hydropower plant are eyed to start construction next year.

With regard to the hydropower plant, the Aboitiz Power still intends to push through with it but is now eyeing the length of Tamugan River that is no longer in the protected area as identified in the city's Watershed Code.

"We've decided to move it out of the protected area. It would also be even smaller than what we proposed," he said.

Aboitiz said Hedcor, a company also under Aboitiz, is yet to finalize how small would be the generating capacity of the hydropower plant.

Aboitiz has two hydropower plants along Sibulan River, which have a combined generating capacity of 42 megawatts. (Jade C. Zaldivar of Sun.Star Davao/Sunnex)

Published in the Sun.Star Davao newspaper on October 06, 2010.

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