Kuala Lumpur — Time is of the essence for power distribution firm Aboitiz Power Corporation as it aims to complete its coal expansion project under its subsidiary, Therma Visayas Inc. (TVI).
On the sidelines of Enlit Asia 2024 here, AboitizPower shared that they are actively speaking with potential partners who will be granted the engineering, procurement, and construction (EPC) contracts for TVI 3.
Ronaldo Ramos, chief operating officer of thermal-operated assets stated “We’re talking to the EPC if they can achieve our timeline [for TVI 3]. We’re looking at before the end of 2027, it would be operational.”
Before its expansion developments, AboitizPower currently operates approximately 300 megawatts (MW) net from coal units. The first two General Electric (GE) units each have a capacity of 150 MW, and the coal expansion also aims for a similar capacity.
This expansion could help address the recurring power crisis in Visayas. However, Ronaldo’s concern looms over potential project delays, as electricity demand in the area could grow further.
“We can’t commit to EPCs yet because of how critical this is. The increase in demand in Visayas will happen in 2027. so, we want to be able to serve the grid, and we will see bigger problems if it’s delayed.”
Ronaldo emphasized that the lack of supply could impact the Visayas, particularly if hotter climate conditions persist into the expected completion year.
“It depends if 2027 would be the El Niño year we might lack power supply. While Cebu is interconnected in Luzon and Mindanao, the impact would be the higher prices,” he said.
If the target year is not achieved, the COO looks into running a diesel-based power supply.
“In case the capacity isn’t enough [to cover the demand], diesel will run again. It’s a cycle,” he stressed. “Because blackouts are a bigger problem. Hopefully, we get to expand the Mindanao interconnection. I hope solar projects in Mindanao will finish on time.”
Meanwhile, AboitizPower is positive towards two banks that could finance TVI 3.
Ronaldo hinted that two existing panels, First Metro Investment Corp. (FMIC) and BDO Unibank, Inc., may provide the loan agreement to proceed with the coal expansion developments.
An economically-realistic transition
In his Enlit Asia presentation on driving a sustainable transition, Ramos elaborated on the Philippines’ electricity strains and issues and how the renewable energy (RE) transition is going.
While he stated that the Philippines is set to have a balanced mix by 2040, he hopes to shine a light on the triggers and catalysts that could be addressed when it comes to going green.
“A cornerstone of this transition will be robust policies that not only encourage the growth of renewable energy but also optimize the overall energy mix, For example, the Renewable Energy Act of 2008 laid the groundwork for incentives, but more aggressive policies are needed,” he said.
Ronaldo also mentioned business incentives as crucial since the private sector would innovate, invest, and accept energy-efficient technologies; while infrastructure investments would drive grids into modernization.
“Furthermore, another catalyst is the funding for new power assets and renewable energy projects. The Green Energy Option Program (GEOP) offers some access to financing, but expanding this initiative is necessary,” he added.
“The Philippines needs around $550-billion to reach its 2050 Philippine Energy Plan Clean Energy Scenario targets. Collaborative expertise and partnerships across the entire supply chain will be critical in accelerating the deployment of new energy technologies.”