A CONSORTIUM set to operate a 246-megawatt (mw) coal-fired power plant in Toledo City next year is now negotiating with Mactan Economic Zone (MEZ) 1 to supply the industrial area in Lapu-Lapu City with power starting next year.
Cebu Energy Development Corp. (Cebu Energy) wants to provide at least 35 mw of power to MEZ 1, whose total peak demand is expected to increase annually.
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“We are still making further study of their loading. We are looking at what they need now,” said Cebu Energy assistant vice president for commercial operations Edecio Satina in a press conference at The Gustavian in Marina Mall, Lapu-Lapu City yesterday.
He said Mez 1’s total power demand is around 40 mw, which is currently being supplied by East Asia Utilities Corp. (EAUC).
According to records acquired by Cebu Energy from the National Grid Corp. of the Philippines, MEZ 1’s total peak demand is expected to increase to around 44 mw next year and close to 50 mw by 2012.
Home to semiconductor firms, electronics manufacturers and other export processing companies, MEZ 1 is one of the potential buyers that the Cebu Energy wants to tap, apart from Mactan Electric Co., Cebu Electric Cooperative and cooperatives in Oriental Negros.
“MEZ 1 is also receiving offers from other electricity generators. We are able to negotiate; they want their power to be served by a plant like ours,” said Satina.
He said the Cebu Energy Toledo 3x82 mw clean coal-fired power plant’s first unit is expected to be operational by the first quarter of next year. This unit is expected to eliminate the power shortage in the Cebu-Negros-Panay (CNP) grid.
The power situation in Cebu and in the entire CNP grid has been described as critical with supply levels falling short of demand. At the end of 2008, power reserves had reached zero.
This year, Cebu’s peak demand is around 615 mw and the required reserve is 144 mw. However, there is a shortfall of around 240 mw since all the power sources combined can supply only 519 mw.
If the deal with MEZ 1 pushes through, Cebu Energy hopes to supply the economic zone in the middle of next year, in time for the completion of the plant’s second unit.
Cebu Energy continues its talks with the Visayan Electric Co. (Veco), another potential client. Veco wants to buy 105 mw from them. It hopes to sign a contract with the electric utility before the end of this year.
Cebu Energy was formed by Global Formosa (a joint venture of Metrobank subsidiary Global Business Power Corp. and Formosa Heavy Industries) and Abovant Holdings Inc. (a joint venture of Aboitiz Power Corp. and Vivant Corp.).
The consortium has signed a P16-billion loan from a group of Philippine-based banks to fund the completion of the facility, whose total project cost is $450 million.
Yesterday, Satina made a presentation about Cebu Energy’s capacity to improve power reliability in Cebu to the Mactan Economic Zone Facilities, Maintenance, and Environmental Association during the group’s first general membership meeting.
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