Kepco Cebu to build P15-B power plant

KEPCO Cebu Corp. (KECECO), a joint venture of KEPCO Philippines Corp. (60 percent) and Salcon Power Corp. (40 percent), is investing P15 billion to construct a 200-MW coal-fired base load power plant in Naga, Cebu.

The first 100-MW generator will start operations in December 2008, while the second 100 MW generator will be operational in March 2009.

A total annual power production of about 1,185,053 MWH will be generated at P3.920 KWH to be sold directly to the Visayas Electric Cooperative and other nearby local electric cooperatives.

The power plant will use Semirara and local Cebu coal. And only if necessary, it will also use imported Indonesian coal.

The project will utilize the circulating fluidized bed combustion (CFBC) technology that complies with world-class environmental standards.

The CFBC technology will effectively reduce the nitrogen oxides (NOx) and sulfur oxides (SOx) emissions of the plant to very low levels or below the standard emissions limits.

At full capacity, the power plant will employ 520 workers.

The CFBC clean coal technology has already been adopted in several countries in Europe, the USA, South America and South East Asia.

The power plant project is the result of a bilateral agreement between the governments of the Philippines and the Republic of Korea as contained in the memorandum of understanding (MOU) executed by the Department of Energy (DOE) and the Ministry of Commerce, Industry and Energy (MOCIE) of the Republic of Korea last June 9, 2004 in Cebu City.

The bilateral agreement was an offshoot of the State Visit to the Republic of Korea of President Arroyo in June 2003.

The objectives of the MOU are to foster cooperation between the two countries in the field of energy; to promote the development and initialization of clean coal technology which meets the requirements of environment friendly power generation; and to assist in addressing the projected power supply shortage in Cebu.

The Visayas grid, which covers Cebu, Negros, Panay, Leyte and Samar, is threatened by power supply shortfalls due to increasing demand for electricity.

The peak demand for the Visayas is expected to grow from 1,060 MW in 2004 to 1,308MW in 2008 and 1,742MW by 2013, exhibiting an average annual growth rate of 5.72 percent.

The Department of Energy (DOE) has endorsed this project in line with the Philippine Energy Plan for 2005-2014 which is the road map for the energy sector for the next 10 years.

The Board of Investments approved the project under activities covered by "Bilateral Agreements" as listed in the 2004 IPP listing and granted it a pioneer status based on the use of CFBC technology that is still untried in the Philippines and the substantial use of domestic coal as raw material.