PNOC-EDC said the loan is part of Phase II of the Environmental Infrastructure Support Credit Program, a lending facility financed by the Japanese government. DBP on the other hand, implements the program to promote environmental investments in the country.
The construction of the power plant will start in June 2004 and commercial operation will begin by December 2005.
PNOC-EDC chairman Sergio A.F. Apostol said the completion of the power plant should help ease the looming power crisis in the Visayas region.
"We are optimistic that we can directly alleviate the projected shortfall in the power generation in the Visayas region by 2005," said Apostol.
This early, a power shortage is emerging in the Visayas and unless critical measures are implemented, power outages will worsen in 2005, when demand for electricity, especially in Panay is seen to rise by 220 MW.
Currently, existing power facilities in Panay are generating only 100 MW and another 60 MW from interconnection. Independent power producers are reluctant to put up new power facilities because of low power rates.
Aside from Palinpinon, PNOC-EDC is also working on the improvement of another 20 MW geothermal power project in North Cotabato in Mindanao and a 40 MW plant in Tanawon, Sorsogon.
Also, the firm is exploring for an additional 40 to 100 MW of geothermal energy in Mt. Cabalian, San Juan, Southern Leyte to support the Visayas grid.
PNOC-EDC is a forerunner in the development of geothermal energy in the country with an installed generating capacity of 1,149 MW that straddles geothermal steamfields in Leyte, Negros Oriental, Bicol and North Cotabato.
"We plan to expand the generating capacity of existing fields either through plant optimization or installation of additional power generators," Apostol said.