MinDA chief questions deal for power plant in GenSan

By | April 5, 2013

GENERAL SANTOS CITY (MindaNews/05 April) — Mindanao Development Authority (MinDA) chair Secretary Luwalhati Antonino has questioned due to supposed lack of consultations the signing last month of a build-operate-transfer (BOT) deal for a 20.9-megawatt (MW) bunker-fired power plant in this city.

Antonino said she is personally opposing the agreement signed by proponents A Brown Co. Inc. (ABCI) and distribution utility South Cotabato II Electric Cooperative (Socoteco II) as it allegedly failed to follow the required procedures and processes, specifically the public hearings.

“Hindi porke may authority kayo sa board pipirma na kayo ng kontrata (It does not mean that when you obtained the board’s authority, you can already sign the contract),” she said in an interview aired Friday morning over ABS-CBN General Santos.

Antonino was referring to the Socoteco II board of directors’ president Elenito Senit and general manager Rodolfo Ocat, who represented the electric cooperative in the supply and transfer deal with ABCI.

Under the agreement, ABCI’s wholly owned subsidiary Peak Power Energy Inc. will build, operate, maintain and transfer a 20.9-MW bunker-fired power plant in the franchise area of Socoteco II over an undisclosed period.


Roel Castro, Peak Power president, said in a statement that the “decision to build power generation facilities is our way of contributing a solution to the power problem in Mindanao.”

Senit said the agreement will help cover for the power deficit within its franchise area as a result of the reduced power allocation from the National Power Corporation (NPC).

Socoteco II is presently implementing daily rotating brownouts lasting seven hours for each of its two feeder grouping or a total of 14 hours due to the power shortage.

The rotating brownouts outages were mainly blamed on the severe load cuts imposed by the National Grid Corporation of the Philippines (NGCP) as a result of the declining generation capacity of the NPC’s hydroelectric plants in Bukidnon and Lanao del Norte.

The electric cooperative, which has a daily average peak power demand of 112 MW, serves this city, the entire Sarangani Province and the municipalities of Tupi and Polomolok in South Cotabato.

In the last two weeks, the area’s power deficit reached as high as 41 MW due to the unstable power allocation from the NPC.

Aboitiz-owned Therma Marine Inc. (TMI) augments the area’s power supplies by 30 MW based on a power sales agreement that it earlier signed with the electric cooperative.

Socoteco II forged the sales deal with TMI in 2011 after the NPC slashed the area’s power allocation to the area by 30 percent or from 104 MW to 72 MW in 2012.

This year, NPC imposed another 30 percent cut to the area’s power supplies or specifically from 72 MW to 52 MW.
Ocat said they remained open to leasing diesel-fired modular generator sets to help ease the brownouts in the area as proposed earlier by the Department of Energy but stressed that they consider the ABCI deal as its best option at the moment.

Such position was based on the analysis made by the Socoteco II board.

“We don’t want an option where we will be involved in the operations of a power resource or get into a partnership agreement,” he said, referring to the leasing of modular generator sets.

During the regional power forum here last week, Energy Secretary Carlos Jericho Petilla presented the leasing or purchase of modular generator sets as immediate alternative option for local electric cooperatives.

He said DoE will assist the cooperatives in facilitating the purchase of the generator sets through a loan scheme that will be administered by the National Electrification Administration.

But Antonino, who has been pushing for the deployment of the modular generator sets in the area, said she will investigate the deal signed by Socoteco II and ABCI.

“I will personally lead the opposition to this deal. If we need to stage a protest rally for this, I will be at the frontline,” she said.

City Mayor Darlene Antonino-Custodio expressed support to the MinDA chair’s initiative saying the local government was not consulted by Socoteco II before it signed the agreement with ABCI.

“The city government and the chamber (General Santos City Chamber of Commerce and Industry Inc.) had been asking Socoteco II to consult us first before making these moves and their power projections,” she said.

The city government previously opposed the signing of the power sales deal between Socoteco II and Alcantara-led Conal Holdings Corporation for the streaming of 70 MW of embedded power to the cooperative starting late 2015.

Under the agreement, which was approved last year by the Energy Regulatory Commission, Conal’s subsidiary Sarangani Energy Corporation will draw the agreed power supplies from its 400-MW coal-fired power plant that is being constructed in Barangay Kamanga, Maasim town in Sarangani Province. (Allen V. Estabillo/MindaNews)