DMCI power unit eyeing to supply off-grid areas

By Emilia Narni J. David, BusinessWorld

Posted at Jan 26 2011 07:07 AM | Updated as of Jan 26 2011 10:12 PM

MANILA, Philippines - DMCI Power Corp. plans to invest in off-grid areas pending discussions with government-owned National Power Corp. (Napocor).

Nestor D. Dadivas, president of DMCI Power, told reporters the company was looking at opportunities in the Small Power Utilities Group (SPUG) served by Napocor.

“We have no specific [site] yet and we still need to talk to Napocor,” said Mr. Dadivas.

SPUG areas are not connected to the main grid and are subsidized by other end-users through the universal charge for missionary electrification.

DMCI Holdings, Inc., the parent company of DMCI Power, inked a power supply agreement with Masbate Electric Cooperative, Inc. to provide power to Masbate in 2007. It has a 24.4-megawatt (MW) diesel power plant in Mobo, Masbate.

Napocor earlier said it was looking for investments of around P7 billion to P11 billion for SPUG areas in the next three years.

There are currently 112 power plants operated by Napocor-SPUG, with a capacity of around 200 MW.

Napocor-SPUG filed on Jan. 14 for a rate increase of P1.3163 per kilowatt-hour (kWh) under its generation rate adjustment mechanism and P0.1982/kWh under the incremental currency exchange rate adjustment for SPUG areas. The increases were based on deferred costs for fuel and foreign exchange movements.

Areas affected by the increase are
Mindoro Oriental and Occidental
Batangas
Marinduque
Quezon
Palawan
Catanduanes
Albay
Romblon
Batanes
Cagayan
Aurora
Apayao
Kalinga
Isabela
Camarines Sur
Masbate
Cebu
Siquijor
Antique
Iloilo
Leyte
Biliran
Samar
Basilan
Sulu
Dinagat
Sultan Kudarat
Davao
Surigao del Norte
Zamboanga
Tawi-Tawi

Napocor sought a higher missionary universal charge of P0.23/kWh from the Energy Regulatory Commission to have operational efficiency in SPUG areas. The regulator approved only a P0.0454/kWh charge in September.