ERC clears power sales deal between Alsons, Zambo coop

MANILA, Philippines - The Energy Regulatory Commission (ERC) has approved the power sales agreement between Alsons Power’s San Ramon Power Inc. and Zamboanga City Electric Cooperative, Inc.

Alsons is the power generation arm of the Alcantara Group.

San Ramon Power said the ERC’s approval would bring the company closer to fulfilling its commitment to provide safe, steadfast, reliable and affordable power to the residents of Zamboanga and the rest of Mindanao.

The company expects to commence construction of the plant in the second half of 2015 and to start commercial operations before the end of 2018.

Alsons said with the approval of the sales agreement, the next challenge in the development of the 105-megawatt plant would be the project financing phase.

 “As many of us know, unforeseen events such as the 2013 Zamboanga City siege have aggravated the financial difficulties faced by Zamcelco. The usual process of securing financing for a major power plant project requires that the distribution utility – in this case Zamcelco – be financially viable,” Alsons Power said.

The company said several initiatives are currently being undertaken to enhance the cooperative’s operating efficiency and financial viability via the entry of an experienced and professional power distribution company that would finance and manage Zamcelco.

 “We fully support these initiatives as Zamcelco’s financial viability is a key prerequisite for San Ramon Power to achieve financial closing and commence construction. The enhancement program of Zamcelco is expected to be completed within the first half of 2015,” Alsons Power said.

While awaiting the completion of the San Ramon power plant, Alsons Power said its other subsidiaries could provide interim power to Zamboanga City.

These include the 100-MW Western Mindanao Power Corp. diesel plant in Sangali, Zamboanga City, the 103-MW Mapalad Power Corp. Iligan diesel power plant – which currently provides Zamboanga City with around 18 MW of power, and the 210-MW Sarangani Energy Corp. coal-fired plant in Maasim, Sarangani.