Crisis slows Cebu power usage

CEBU, Philippines - Due to massive cutbacks on operation of some major manufacturing and exporting companies in economic zone, power consumption in the province is currently low but the Cebu Chamber of Commerce and Industry’s power core group believes this phase is just temporary because the impending power problem is yet to come.

Cebu Chamber Power Core Group chairman Carlos Co said that currently, the power supply of the province is being stabilized by the looming crisis as major manufacturing companies are cutting down their power consumption because their operations have been under a slowdown as volumes and orders are down.

“The power usage of the province has lowered down because plants in the Mactan Export processing zones are no longer working 24 hours and seven days a week. There is also a reduced demand of power from export companies such as furniture manufacturers because most have closed down or reduced their operations,” said Co.

However, he said that the power supply of Cebu still needs to be improved as expansions of new hotels and establishments from the thriving business process outsourcing industry will require additional power load.

“There will still be a shortage if we don’t work on ways to offset this possible increase of power demand. Cebu actually needs this additional power supply as soon as possible because without it, the anticipated critical power crisis will badly hit us,” said Co.

He said that at the moment, positive prospects of the new plants are expected to be rolled out by the first quarter of 2010.

Co said that the two new power plants in the cities of Toledo and Naga will provide a combined 450 megawatts of additional power supply which is enough to sustain Cebu’s 10 to 30 megawatts power demand every peak hours.

“As of now, there is a deficiency in power of about 10 megawatts during peak hours but with the new plants in 2010, this situation will be averted,” said Co.

According to sources, Salcon Kepco’s first of the two 100 megawatts coal-fired plant which is scheduled to be delivered in 2010 is currently one month ahead of schedule while Toledo’s 240 megawatt-capacity Global Power plant is expected to operate around April next year.

But as for the meantime, some major players in Cebu’s business sector have agreed to do load shedding through using their own generator sets to help avert the power crisis.

Co said that some Cebu companies use their own generator sets during peak hours such as San Miguel Corp. and major shopping malls like SM Cebu, which has huge power consumption.

“It is more expensive for these companies to utilize their own generator sets than to purchase power from VECO, but we are also working ways so that VECO will reduce their power rates to also benefit these companies,” said Co.         

According to recent reports, the Philippines badly needs to build 5,000 megawatts of new electric power plants between now and next year so as to avert crippling power outages when the economy is expected to recover.

Co said that Luzon will likely need this new power supply between two to tree years from now, but the situation in Visayas is a lot more critical as consumer demand for electricity had overtaken supply last year.

He said that the Visayas region immediately needs around 700 megawatts to prevent the now regular power outages to grow into terrible levels.

“By the first quarter of next year, new power plants will already be in placed so the foreseen problems will be averted. Even Iloilo will also have their new 100 megawatts power plant by next year, so there will be sufficient supply to be utilized especially once the economy starts to recover,” said Co.