MANILA, Philippines - State-run National Power Corp. (Napocor) has commissioned Alcantara-owned Conal Holdings Corp. and Korea Electric Power Corp. (Kepco) to develop renewable energy (RE) projects with the Small Power Utilities Group (SPUG) in off-grid areas.
SPUG is Napocor’s missionary electrification arm, mandated to provide electricity to remote islands and far-flung, inland barangays that are not connected to any of the main grids.
SPUG currently services 78 small islands and eight off-grid areas. It operates 304 generating units with a total rated capacity of 128.997 megawatts. It has 42 customers or off-taker distribution utilities, consisting of 39 electric cooperatives and three local government units.
SPUG vice president Melburgo S. Chiu told reporters that they may also have a similar undertaking with state-owned PNOC-Renewables Corp. (PNOC-RC).
“We are currently exploring the possibility of entering into joint venture agreements with Kepco, Conal and PNOC-RC,” he said. “There is no definite area yet where they will be going. The agreement is now in Phase 1, where they are looking for possible areas to develop, and what possible technology to use.”
But Chiu said they would likely focus on Palawan and Mindoro areas where SPUG services are needed.
“Right now the biggest market may be Palawan and Mindoro, as about 70 percent of our expenses go there, so if you are a private company, that might be attractive,” he said.
Under the agreement, Napocor would provide data and expertise to the power companies.
Chiu said Napocor was approached by these power firms to determine areas that may need private sector participation in rural electrification.
The Napocor official said these companies would likely pursue developments in hydroelectric and wind power.
“PNOC-RC has submitted a MOA but it not yet finalized. They are looking at Dinagat, Polilio and Casiguran. Right now, they are firming up their business plan,” he said.
Chiu said Napocor is also talking with a European company for possible development of biomass power.
“We are now studying various agreements like biomass. It’s a European company which plans to introduce biomass technology,” he said.
Last year, Napocor-SPUG signed its first qualified third party service contract with Powersource Philippines Inc. for the supply of electricity in Bgy. Rio Tuba in Bataraza, a second-class municipality located on the southernmost tip of mainland Palawan.