Aboitiz plans Davao coal plant expansion

by Alena Mae S. Flores – January 08, 2016 at 11:45 pm

from Manila Standard

TORIL, Davao City—Aboitiz Power Corp. is considering a possible expansion of its newly-completed P35-billion, 300-megawatt coal-fired power plant in this city by another 300 MW.

Aboitiz Power chief executive officer Erramon Aboitiz told reporters the site of the new power plant had room for expansion, adding the company was monitoring the need for an additional capacity.

“We definitely plan on expanding, you see we have extra land and it is what we plan on doing. It’s important that we time it properly, I think we have all the approval in place… We have facilities here for additional 300 MW,” Aboitiz said.

“Right now, with the power plants that are being built, I think Mindanao has ample power so there’s no need for it at this point but we will watch very closely,” Aboitiz said.

He said Mindanao was under suppressed demand but its economy was expected to sustain economic growth. Mindanao is projected to require an additional electricity capacity of 150 MW to 250 MW annually.

“There’s a lot of suppressed demand so I think we are taking a very close look on how it will happen. A lot depends on the growth so we have to watch it very closely,” Aboitiz said.

He said while the new plant took over five years to build, the expansion would likely take a shorter time to construct.

“If the growth suddenly picks up very fast, then we have to move faster but luckily now, we already have the land, permits and [the Environment Department] approval. So hopefully if you make a decision to build another plant, it will be much faster,” he said.

Aboitiz Power is watching the demand outlook for Mindanao, which is projected to have an oversupply of power in 2020 or 2021.

“We have to keep a close eye to make sure we build a power plant before it is needed. There is no definite timeline for this,” Aboitiz said.

Aboitiz said the expansion would likely cost 10 percent less than the current coal facility.

“There are additional facilities but the bulk still needs to be invested so I say power plants like this cost all in with everything around $2.5 million a MW. So if were able to expand this one, it will be cheaper,” he said.

President Benigno Aquino III, who visited this city, said “the Mindanao situation has made it obvious that we also need more baseload power” and “we cannot wean ourselves completely from relying on coal.”

“When this plant becomes fully operational, we can count on it to consistently produce 300 megawatts of baseload power, which means that this capacity can be tapped into anytime, rain or shine, with very minor fluctuations,” Aquino said.

He said the power plant’s dependable capacity was roughly equivalent to one-fifth of the Mindanao grid’s highest peak demand in 2015.”

Aquino said the private sector had committed to build at least 11 power projects in Mindanao that would come online between 2016 and 2020 and provide another 675.30 megawatts of capacity, “which will be more than enough to cover the projected increase in demand for those years.”

The Aboitiz coal-fired power plant, the single biggest power project completed since 2007, supplies baseload power to more than 20 electric cooperatives and distribution utilities in Mindanao.