By Lenie Lectura – December 11, 2016
from Business Mirror
A TOP executive of Alcantara led-Alsons Consolidated Resources Inc. (ACRI) said over the weekend the impending oversupply in Mindanao would only last for three years.
“In our estimation, there will still be an oversupply, but it will only last for about three years from now,” Alsons EVP Tirso Santillan said.
“Historically, demand growth in Mindanao is about 3 percent per annum. Mindanao has been one of the fastest-growing regions in the Philippines so we think that 3 percent is very small even with a gross domestic product growth rate of 7 percent. It’s still small,” Santillan said. “We think there will be an oversupply, but it will probably be shortlived.”
Mindanao has a peak requirement of about 1,300 megawatts (MW) to 1,400 MW. Supply is seen to almost double with 1,000 MW more of additional capacity that would come from power producers, including Alsons Power, SMC Power, FDC Misamis Corp. and Aboitiz Power Corp. This new capacity adds to Mindanao’s installed capacity of 2,414 MW as of 2015, of which 2,044 MW are considered dependable.
Santillan said based on internal projections, Mindanao’s growth rate would probably hit 10 percent to 12 percent per annum. Given this, the power plants being built in Mindanao are just enough to serve the power-hungry grid.
“Posible yung fast growth. There’s a saying na if you build them they will come. In Luzon, if you look at per-capita consumption of power, Luzon is three times bigger than Mindanao. So there is really a lot of room for growth in Mindanao. People just need to be assured there is power,” he said.
“In households, you will not buy an appliance if you don’t know if you can run it. Factories will not expand unless they know there is power. If you look at various projects in Mindanao, as well, there’s a lot of mining projects that have not yet taken of. Assuming they take off, they are big consumers of power,” Santillan said.
Energy Secretary Alfonso G. Cusi said he is aware of the situation. He, however, downplayed the possible disadvantages, if any, that may arise from the oversupply of power.