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Mindanao power firms weigh in as NGCP transmission project faces delay

By Angelica Y. Yang

THE delay in critical transmission projects brought about by the latest travel ban will affect the operations of power generation companies in Mindanao, a power plant developer said.

This comes after privately owned National Grid Corporation of the Philippines (NGCP) earlier raised concerns that delays caused by the newest travel ban would hamper critical power transmission projects that had yet to be completed.

In a press release on Dec. 31, the firm said that the travel restrictions would slow down the vessels carrying transmission equipment for the submarine cable laying activity of NGCP’s Mindanao-Visayas Interconnection Project (MVIP). The project aims to unify the three grids across Luzon, Visayas, and Mindanao.

Global Business Power Corp. (GBP) Commercial and Sales Head Philip D. Dasalla said that MVIP’s completion would allow Mindanao firms to sell excess power to retail markets in Luzon and Visayas.

“The timely completion of MVIP is critical to the power industry as it will enable power generators in Mindanao such as our affiliate company, Alsons Thermal Energy Corp., which owns Sarangani Energy Corp., to sell excess capacities to wholesale and retail markets in Visayas and Luzon,” Mr. Dasalla told BusinessWorld in an e-mail on Thursday.

Asked whether the projected delay would impact GBP’s operations in selling excess power, he said that it would.

“Yes, as well as other power generation companies in Mindanao. Kindly note that the Mindanao grid has the highest reserve margin among the [three] grids,” Mr. Dasalla said.

Meanwhile, Aboitiz Power Corp., which operates the 300-megawatt (MW) coal-fired plant under Therma South, Inc. in Mindanao, said that it would not be affected by the reported delay of the MVIP.

“Specific to AboitizPower, we don’t expect our Therma South, Inc. (TSI) coal facility to be affected by the reported delay of the interconnection as our supply is transmitted only within the Mindanao grid and it is already fully contracted to distribution utilities in the region,” Aboitiz Power Corp. President and Chief Executive Officer Emmanuel V. Rubio told BusinessWorld in an e-mailed response on Thursday.

He added that NGCP needed the full support of the government to ensure that critical transmission projects in all three major islands, particularly those entering load centers in major cities, should get implemented on time to “sustain a stable and reliable energy supply and service for the country.”

For Alsons Consolidated Resources, Inc. Chairman and President Tomas I. Alcantara, the long-awaited interconnection of the Visayas and Mindanao grids through the MVIP would “greatly benefit” power consumers.

“While we fully support the national government’s efforts to protect the country from the new COVID-19 (coronavirus disease 2019) variant, we at Alsons share NGCP’s concern about possible further delays to the completion of the interconnection project as a result of the latest travel ban,” Mr. Alcantara said in an e-mailed response to BusinessWorld on Friday.

“We simply cannot have any further delays to this project as access to power is imperative to our country’s economic recovery,” he added.

AC Energy Corp. President and Chief Executive John Eric T. Francia said that the Mindanao-Visayas link was crucial in balancing power supply and demand in the country.

“Hopefully, the project will be completed in time for the expected economic recovery and resurgence in power demand,” Mr. Francia told BusinessWorld in a Viber response on Wednesday.

He further explained that Mindanao is in a position to provide power to Luzon and Visayas once the demand resurges, since it is “expected to be in an over-supply situation in the coming years.”

AC Energy is the majority stakeholder of the 552-MW thermal coal plant GNPower Kauswagan Ltd. Co. in Mindanao.

Last month, NGCP said that it understood the need to control the virus and protect the people. However, there must be “creative ways” to balance health concerns with keeping the economy afloat.

“NGCP’s critical projects cannot face any further delays as this may have an implication on the stability and reliability of power transmission services, especially with the growing demand for power,” the power grid operator said in a statement.

BusinessWorld reached out to NGCP for a comment on how long the projected delay for the MVIP would be, but has yet to receive a reply as of press time.

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