THE Central Negros Electric Cooperative (Ceneco) is keen on tapping renewable energy (RE) sources for its future power requirement amid the effects of the tax reform law, its official said.
Ceneco president Roy Cordova said that with the impending increases in power rates brought by Tax Reform for Acceleration and Inclusion (Train) law, the cooperative will push for contracts with “green” energy suppliers.
The tax reform law increases the excise tax on coal and fuel products.
Of the 137.9 megawatts (MW) total contracted supply of Ceneco with four power generators, 117.9 MW or about 85 percent are sourced from diesel and coal-fired power plants.
Based on Ceneco’s initial computation, the upward adjustments on excise tax would result to P0.03 to P0.05 per kilowatt hour increase on electricity rates for generation charge only.
Cordova added that through the Competitive Selection Process (CSP), they will give priority to “green” sources like solar, which is abundant in Negros Occidental.
“Aside from being environment-friendly, RE generation firms have tax incentives, including value-added tax exemption thus, the cost of power is cheaper,” he said.
Ceneco, which serves consumers in the cities of Bacolod, Bago, Talisay and Silay and the municipalities of Murcia and Don Salvador Benedicto, has a current demand of almost 155 MW.
Its base load of 64 MW is sourced from Kepco-Salcon Power Corp. (KSPC), a coal-fired power plant in Naga, Cebu.
Three other firms, including Palm Concepcion Power Corp. (coal) in Iloilo, supplies 35 MW to Ceneco; Green Core Geothermal Inc. (geothermal), 20 MW; and Energreen Power Development and Management Inc. (diesel), 18.9 MW.
The KSPC supply deal is the first to expire in February 2021. The others will end in 2024 and 2031 yet.
Amid the looming effects of the tax reform law, Ceneco has recognized the need to push for the utilization of “green” energy sources given the province’s potential not only in terms of solar, but also wind and hydro.
Cordova told SunStar Bacolod that a firm is currently finalizing its feasibility study on producing at least two-megawatt hydro power at Maragandang River in Barangay Mailum, Bago City.
Once completed, it will be recommended to Ceneco Board.
Cordova said it will then be submitted to the National Electrification Administration and Department of Energy.
“We are hoping that this engagement will materialize soon,” he said, adding that the move to tap RE sources is positioned to ensure cheaper and efficient power supply.