Napocor mulls higher usage of local coal

State-owned National Power Corp. (Napocor) is looking at the possibility of increasing the volume of local coal that is being used to run its coal-fired power plants, a ranking company official said.

Napocor is currently blending 10 percent of local coal every month to generate power from its coal-fired facilities.

"We will eventually increase the volume to more than 10 percent if this test blend will prove feasible," the Napocor official said.

The official said if possible, they would be looking at a 30 percent/70 percent blend and eventually a 50/50 percent blend of local and imported coal.

He said they have started the pre-blending of local coal in Pagbilao power plant, one of Napocor’s independent power producers (IPPs).

Pagbilao power station consists of two 367.5 megawatt (MW) coal-fueled generating units or a total of 735-MW generating capacity. It is utilizing about 30,000 tons of coal per month.

It was developed on a 29-year build-operate-transfer (BOT) contract basis between the Napocor and Mirant Philippines Inc., a subsidiary of US-based Mirant Corp.

Last year, Napocor started to bid out for blended coal at that time when there was coal shortage in China.

Napocor is currently importing most of its coal requirement. Using blended coal, on the other hand, will enable the power firm to diversify its coal sources.

Aside from Pagbilao, Napocor runs the Calaca, Masinloc, Naga and Batangas coal-fired power plants. Another IPP of Napocor that is being run in coal is Sual, also managed by Mirant.

Napocor is reportedly sourcing its local coal requirement from Semirara Coal Corp.

In 2004, coal represented bulk of the generation mix of Napocor at 16,194 gigawatt/hour (gwh) or 28.9 percent of the total.

But the share of coal in the company’s generation mix has gone down to 15,307 MW or 26 percent in 2005.

It is expected that in 2006, the share of coal in the gross generation of state-run power firm will further decrease to 25.3 percent.