IPPs to charge 82 centavos kwh peaking power rates Failure to sign contract faces power curtailment

By MT News Network

Calamba, Misamis Occidental---To those that failed to sign contract on Independent Power Producers (IPPs) for the supply of electric power will face power curtailment between 3-4 hours starting on Sunday, November 28, 2010 as electric coops officials galvanized to act because the government-owned Mindanao hydropower complexes can only generate 700 megawatts to supply the 32 electric cooperatives in Mindanao including private utilities that operated in urban cities in the island.

This developed when the National Grid Corporation of the Philippines (NGCP) sent an advisory to private power utilities and electric cooperative that starting on November 28, 2010, Sunday, they will impose 3-4 hours power curtailment because the hydropower complexes particularly, the Agus and Pulangi hydros have no enough power to supply the Mindanao Grid which needed more that 1,200 megawatts of electric power.

Due to the said “ADVISORY” representatives of the Aboitez-owned Therma Marine Incorporated (TMI) which owned Power Barge 117 and 118 toured whole Mindanao to convince electric cooperatives in signing contracts for the supply of electric power coming their 2 power barges which ironically are the only bunker fuel-operated power barges in the island.

The continued supply of electric power will cost electric consumers 82 centavos in their electric bills.

“Electric consumers should choose the additional 82 centavos power hike in December or 3-4 hours brownout,” a top official of the Misamis Occidental I Electric Cooperative (MOELCI I) said, adding that the 82 centavos in not for MOELCI I but for the payment of the services of Therma Marine’s Power Incorporated (TMI) Barges 117 and 118.

Therma Marine Incorporated is the controversial supplier of electric power for ancillary services during the massive brownout on December 2009 to May 2010 that billed electric cooperatives with a whooping $78 million.

The NGCP contracted TMI to supply the ancillary services to electric cooperatives and private utilities for 6 months resulting for the $78 million power bills.

The Association of Mindanao Rural Electric Cooperatives (AMRECO) filed series of cases against NGCP-TMI in what they believed misrepresentation to the Energy Regulatory Commission (ERC) leading to the issuance of the Provisional Authority (PA) to collect the ancillary services at the tone of 96 centavos per kilowatt hour.

Some electric cooperatives filed separate cases against NGCP-TMI for the said unreasonable and astronomical power rates adding that NGCP has no legal personality because its job is for transmission and not generation. The National Power Corporation/Power Sector Assets and Liabilities Management (PSALM) which owned the generation should have been the right agency to contract TMI for the ancillary services.

The said incident galvanized electric cooperatives in speeding up their individual mini and mega hydropower plant projects so that in the future they will not be guillotine by independent power producers like the TMI when power crisis arise.

Meanwhile, a power consumer group in Mindanao alleged that TMI earned 3 times more than the price of buying power barge 117 and 118 which according to them had been purchased for $27 million from the government.