Two privatized power plants embark on capacity expansion

The Power Sector Assets and Liabilities Management Corp. (PSALM) said two of the power plants it has sold to private entities are now embarking on capacity expansion projects that will at least double their respective installed capacities.

PSALM said Sta. Clara International Corp., which bought the 1.2-megawatt (MW) Loboc hydroelectric power (HEP) plant in Bohol, plans to construct two additional generators to optimize the use of the abundant water available in Loboc River.

Meanwhile, Sorsogon Electric Cooperative II (Soreco II), which purchased the 0.4-MW Cawayan HEP plant in Sorsogon City, will undertake a hydro development project to bring in a 2.4-MW new generating plant.

Sta. Clara president Nicandro G. Linao said Loboc’s plant capacity factor (PCF) had improved from 77 percent to more than 90 percent since the facility was turned over by PSALM last year.

As a result, electricity production increased by over 10 percent from a little over eight million kilowatt hours (kwh) to about 9.5 million kwh. Loboc has been operating since 1957.

"We believe Loboc HEP is an audacious choice because its capacity factor is high and more important, its water resource is abundant, making expansion possible," Linao said. "Although the plant is relatively small and old, we believe we can prolong its operating life by continuously improving its system and technologies, developing and empowering our employees, and consistently conducting preventive maintenance."

Loboc HEP manager Dominador Borje added that they have started the comprehensive feasibility study on engineering and economic viability of the proposed expansion. Even at lower plant factors ranging from 60 percent to 80 percent, these additional generating capacities could be viable, he said.

The plant was turned over by PSALM to Sta. Clara in June 2005. Sta. Clara paid the $1.42-million price tag it submitted during a public bidding held in November 2004.

Sta. Clara said its acquisition of the Loboc HEP is a timely and relevant response to the growing industrial development and tourism potential of Bohol, the Philippines’ 10th largest island. All the villages of Bohol have access to electric service provided by three electric cooperatives – Bohol I, II and III.

Panglao Island, which is connected to Tagbilaran City by two bridges, is noted for its white beaches that are comparable to the more famous Boracay, while Balicasag Island is described as one of the country’s best dive spots. An international airport is now being planned for Panglao where tourist resorts are enjoying brisk business.

On the other hand, the proposed Cawayan CHEP project offers the possibility of expanding Cawayan’s existing 0.4-MW capacity by more than five times. The two-phase expansion project involves developing the tailrace and constructing a dam downstream.

"Cawayan’s expansion program is a manifestation of our earnest response to heed the call of the government’s power development program and avoid the power shortage projected to hit the Luzon grid in 2007," Jose Gerald Y. Cubias, Soreco II general manager, said.

It will also help Soreco II provide better quality of service and at the same time, render itself more viable. The electricity produced by Cawayan is fed directly to Soreco’s 13.8-kilovolt primary line.

"We consider the plant as a very valuable asset to be acquired," Cubias said. During the five years that Soreco was operating the plant, the cooperative posted a financial turnaround.