Wednesday, November 15, 2006 Veco, PNOC sign pact for more power in Feb.
CONSUMERS of the Visayan Electric Co. (Veco) in Cebu can expect more stable energy supply next year once the distribution utility starts getting 15 megawatts a day from the Northern Negros Geothermal Power (NNGP) plant.
This, as Veco signed yesterday a 15-megawatt a day, five-year power supply agreement with the Philippine National Oil Co.-Energy Development Corp. (PNOC-EDC).
“This is an important development for Veco as we continue to look for ways and means to provide quality service to our customers by improving our system reliability,” Veco president Dennis Garcia said during the agreement signing at the Veco conference room in Banilad, Cebu City.
Tight
PNOC-EDC will sell to Veco 133 gigawatt-hours of power annually from NNGP plant in Mambucal, Negros Occidental starting Feb. 3, 2007.
Veco assistant vice president for utility economics Arlo Sarmiento said with the “tight power supply” in the Visayas grid, additional energy supply will meet the growing demand of Veco’s consumers next year.
“There is no shortage in the supply of power, the additional supply will mean an increase in available power for Veco’s franchise area,” Sarmiento said.
He said Veco’s potential growth rate is between two to four percent with a demand of 300 megawatts during peak hours.
“Despite the fact that the power supply will be coming from a geothermal plant- it being environmentally friendly— we will still be using diesel or fossil fuel. But in the long run, we hope to minimize the use of diesel and fossil fuel,” he said.
While NNGP produces renewable energy, it will also be competitively priced, Sarmiento said.
“The agreement with Veco marks a very important development in our company’s history. Our entry into the direct supply of power to distribution utilities is an initiation for us but we expect to build a good presence,” said PNOC-EDC vice president for operations Marcelino Tongco.
Tongco is optimistic the partnership it clinched with Veco will pave the way for more power supply contracts in the next few years.
“I think its been said that there is a natural partnership between us because our interests are complementary. Since Visayas is our major area of operation, projects here are in the pipeline,” he said.
Capacity
Tongco said PNOC-EDC has a gross capacity of 49.3 megawatts and a net capacity of 43 megawatts.
Its facilities in Leyte have a total capacity of 700 megawatts, of which 340 megawatts are brought to Cebu through the Leyte-Cebu Interconnection Project’s submarine cables.
Tongco also said PNOC-EDC is in talks with both foreign and local companies to finance the construction of another power plant with 20-megawatt capacity.
“The steam is already available. We have started the pre-auction and the offers are good. So hopefully it will start by January,” Tongco said.
PNOC-EDC is Veco’s fourth supplier of energy along with Cebu Private Power Corp., Toledo Power Corp. and National Power Corp. (MMM)
