Mirant, Napocor team up to sell excess capacities

SUAL, Pangasinan – Mirant Philippines Corp. has tied up with the National Power Corp. (Napocor) for the marketing of both companies’ excess capacities.

Mirant Philippines vice president for corporate and external affairs Allan Paul M. Flake, in a press briefing here, said the joint venture provides for a 50-50 sharing in the selling of the power firms’ surplus energy.

Mirant’s Sual power plant, which runs on coal, can generate up to 1,218 megawatts of electricity. Of this capacity, a total of 1,000 MW has been committed to Napocor, leaving an excess capacity of 218-MW. Of this excess capacity, Flake said, they have been able to sell 50 to 60 MW under the arrangement with Napocor.

Flake said, Mirant has 10 big industrial customers including some which are located in the economic processing zones in Baguio (like Texas Instruments); TIPCO (a paper company) in Pampanga; Bataan Polyethylene Corp.; Petrocorp.; and La Farge Cement Corp.

To attract customers, Flake said they offer a much cheaper electricity rate under the program which started last year. "Such as in the case of Bataan, we supply half of its power supply while the Napocor supplies the other half. In this way, we will get rid of our excess power as well as Napocor’s. But we sell this at a rate less than the contracted price between Napocor and Manila Electric Co.’s (Meralco)."

Mirant has signed various power purchase agreemeents (PPA) with these big industrial power users with contract maturity ranging from five to 25 years.

To facilitate the delivery of reliable power to these industrial customers, Mirant has invested some $20 million on infrastructure projects related to the program, including the putting up of 60 to 230-kilovolt (kV) high-voltage transmission lines and a substation in Bataan. "The Napocor can’t do it because it is capital intensive. But this investment could be recovered through the PPA costs as stated in our 20-year contract with Bataan," he said.

Sual is the largest and cheapest to operate among the large capacity and cost-effective power plants in the country. It consists of two brand-new units of 609 MW coal-fired thermal power plants manufactured by Alstom.

Mirant Philipines, a local subsidiary of Atlanta-based Mirant Corp., is the largest private producer of electricity in the country, with more than 2,500 MW of installed capacity.