Sunday, December 11, 2005



By Francis Allan L. Angelo

CONTRARY to the claims of a lawyer-cum-consumer activist, Iloilo City cannot rely on the National Power Corporation (Napocor) for electricity supply if Panay Power Corporation (PPC) decides to shut down its operations due to financial problems.
Engr. Nelson Homena, plant manager of Napocor’s diesel-fired power plant in Dingle, Iloilo, made the grim revelation even as the Energy Regulatory Commission (ERC) is set to hear the Panay Electric Company’s (Peco) petition to revalidate its power supply agreement with PPC.
Last week, officials of Mirant Global Philippines, which owns PPC, said they might cease from providing power to Iloilo City this month as Peco is paying less than what they are buying from the power producer due to the ERC-sanctioned rate cut.
Mirant vice president for Visayas New Business Arman Lapus said Peco owes them more than P250million three months after the rate reduction.
“What Peco is paying is not even enough for our fuel. There is a need to revert back to the old Peco rates so we can continue operating,” Lapus said.
In an interview with The Guardian, Homena said they cannot supply electrical power to Peco and Iloilo City “since we also have our own problems.”
Earlier, Atty. Romeo Gerochi of Freedom from Debt Coalition claimed that the Napocor can provide electrical power to the city
But the Napocor is already supplying power to Iloilo, Capiz, Aklan and Antique which have a combined demand of 110-115 megawatts.
Homena said they have an actual capacity of 128MW sourced from the power barge stationed at Estancia, Iloilo; the 17.5-MW Panay diesel-fired power plant in Dingle town; and an additional 65MW from the Cebu-Negros-Panay power grid.
“In fact, we only get what is left of the CNP grid as we are at the tail end of the line. The CNP power supply is meant to augment our generation,” Homena said.
However, power industry experts said power producer must have a reserve of at least 20MW in order to ensure its supply.
With only a 13-MW reserve, Napocor’s capability to supply power to Iloilo City is “precarious.”
Homena said their reserve power is only enough to fill in the needs of Panay consumers, especially during peak hours. “What we have is only enough for Panay.”
Not even the Pinamucan diesel fired plant can help avert the looming power blackout in Iloilo City as it has yet to operate.
Homena said they have only tested four out of eight engines of the 110-MW Pinamucan plant.
“But we still have to overhaul the four engines to make sure that they will operate properly. Our major concern now is funding because we will be spending hundreds of millions of pesos for overhauling alone. And we still have four engines left to fix,” Homena said.
Homena projected the full operation of the Pinamucan plant, which has a dependable output of 80MW, early next year. But even if it comes to life, the said plant will only serve as replacement supply rather than additional supply to Panay with the pending transfer of the 32-MW power barge from Estancia town to Mindanao.
Low voltage
Homena also admitted that majority Iloilo towns are suffering from rotating brownouts due to low voltage capacity of the transmission lines to the three Iloilo electric cooperatives.
“But this problem now falls under the jurisdiction of the National Transmission Corporation which is trying to up-rate its lines. They are suggesting that we generate more power to make up for low voltage but that would be too expensive for us,” Homena said.
And even if Napocor can supply power to Peco, Homena said it will take some time due to lack of interconnection structures and contract.
“We have no interconnection with Peco since 1998 when it bought power exclusively from PPC. It’s a long shot for us to support the power needs of Iloilo if PPC closes down,” Homena said.
At the City Hall, the wait-and-see mode prevails.
“Let’s just wait for the result of public hearing. We will not pre-empt what will be the outcome of the consultation,” acting Mayor Guillermo Dela Llana explained to reporters yesterday.
Dela Llana also left the responsibility to make a stand on the issue to Mayor Jerry Treñas who is due to return from abroad on December 12.
“It will depend on the decision of Mayor Trenas to make a stand on the issue. This is a big problem for the city. I leave that to him (to address),” Dela Llana pointed out.
Dela Llana said the business community will be severely affected by the “power crisis” although he hinted it would be “repulsive to bring back the old rate since consumers would be against it.”
When asked on the looming blackout if PPC ceases its operations due to losses brought about by the reduced rates, Dela Llana said “that remains to be seen.”
“That is a big question since the city is relying on Peco alone for electricity,” he added. (With reports from Jeehan v. Fernandez)

LMP: Blackout disastrous to economy

By Francis Allan L. Angelo

THE League of Municipalities (LMP) – Iloilo Chapter is the first sector to voice out support for Panay Power Corporation’s (PPC) appeal to revert to the old Panay Electric Company (Peco) rates to prevent closure on the part of the power producer.
After a special meeting with Mirant Global Corporation and PPC officials last December 2 at the new provincial capitol, the LMP came out with Resolution No. 25-12/02/2005 urging the Energy Regulatory Commission (ERC) to “immediately formulate a win-win and lasting solution to this problem that will ensure reliable electric power service to the consumer.”
The ERC is set to hear today Peco’s petition to revalidate its power supply agreement with PPC which has been severely affected by the recent rate cut.
The resolution said that power failure and interruption are inimical to the economic growth and development of the province of Iloilo and should be avoided at all costs.
The LMP, headed by Barotac Viejo Mayor Raul Tupas, said they are concerned with the prospects of a power blackout in Iloilo City “due to the operational constraints affecting the resources of the power plant in procurement of fuel supply.”
The LMP also believes that investors in Iloilo, including Peco and PPC “should be allowed to earn a reasonable and fair return on investments for them to be able to provide reliable and continuous service to the consumers.”
“The threat of a massive power failure – be it in Iloilo City or the province – in this Christmas season will surely create a negative impression in the economic thrust of the business sector and the consumer market as a whole,” the resolution further stated.
Aside from Tupas, other officers who signed the resolution were Mayors Gerardo Flores of Miag-ao, LMP secretary-general; Alex Centena of Calinog, vice president for external affairs; Rolando Distura of Dumangas, executive vice president; Mariano Malones of Maasin, treasurer; June Mondejar, VP for internal affairs; and Romeo Jessmon Labramonte, executive director.
Copies of the resolution were furnished to the ERC, Peco, PPC, Office of the Iloilo City Mayor and the Iloilo provincial government. (Published in The Guardian, December 6, 2005 issue)


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