Third Toledo coal plant to add 150 megawatts to Visayas grid

CEBU, Philippines — Heeding the call of business leaders and government officials to address Cebu's looming power supply shortage, Aboitiz Power Corporation, through its subsidiary Therma Visayas Inc. (THI), has announced its readiness to generate an additional 150 megawatts (MW), which will be operational by 2028.

The target completion of the brownfield plant in Toledo City, Cebu will depend on the timely approval and release of prerequisite documentation, including the environmental compliance certificate (ECC) from the Department of Environment and Natural Resources (DENR), the completion of bidding from original equipment suppliers, and a system impact study from the National Grid Corporation of the Philippines (NGCP), said Ronaldo Ramos, Chief Operating Officer for operated assets of the AboitizPower Thermal Business Group.

Ramos, who was in Cebu to speak before the delegates at Cebu Business Month’s (CBM 2024) “Good Design. Good Business Summit” held at the SM Seaside City, assured that once all these requirements are approved, the company will start the construction of the third coal-powered plant before the end of 2025.

The Department of Energy (DOE) projects that energy demand for Cebu Province will reach around 1,400 MW in the next two years and will outpace supply by 2027 unless new baseload power plants are constructed.

Visayas has a generating capacity of 2,454MW and a system peak demand of 2,153MW or a margin of only 239MW as power reserves.

Cebu province accounted for half of the region’s total demand and within Cebu, Metro Cebu, falling under the Visayas Electric franchise area, contributed to over 500 megawatts, representing more than half of the province-wide demand.

Record showed that Central Visayas is the fastest-growing regional economy in the Philippines, with a growth rate of 7.3 percent in 2023, or an estimated P1.38 trillion, up from P1.29 trillion in 2022.

Aboitiz Power’s TVI currently operates a 340-MW coal plant in Toledo City.

“Our diverse energy portfolio affirms our belief that no one-size-fits-all solution exists, nor does any single organization hold all the answers and solutions. Together, we possess the power to shape a future where we can all proudly say we played a part in it,” Ramos said.

Earlier, Cebu Governor Gwen Garcia stressed the immediate need to tackle the power supply issue, saying "We cannot continue to depend primarily on others for our power. We must achieve self-sufficiency, not by 2027, but right now."

Likewise, business leaders in Cebu have been calling on power generation companies to invest in additional power plants.

“More power supply is always better," said Cebu Chamber of Commerce and Industry (CCCI) past president Charles Kenneth Co.

Mandaue Chamber of Commerce and Industry (MCCI) president Mark Ynoc described power as a vital element in the recovery now from the economic effects of the pandemic.

According to Ynoc, additional power plants are needed in anticipation of more investments and an increase in population growth.

“When there is a pressing need for power then we definitely need additional generation capacity and infrastructure," Ynoc added.

TVI's expansion of the coal plant in Toledo City is equipped with a "Circulating Fluidized Bed (CFB)"  that will lessen emissions during operations.

“Businesses in Cebu have reported an average of three to four power outages per week, each lasting between one to two hours,” Ramos said.

According to Ramos, the Visayas grid recently encountered an unprecedented surge in demand, reaching a record-high of 2,525 megawatts, which signals “a clear and significant upward trend in electricity consumption.”

Ramos added that an overloaded power system struggling to meet increasing demand has caused frequent red and yellow alerts.

Ramos said addressing the unsteady power supply in Cebu and Central Visayas is crucial as it may prevent the region from achieving its full economic growth potential.

Cebu’s rapid development is driven by its strategic location, robust infrastructure, thriving tourism industry, and burgeoning business process outsourcing (BPO) sector. This growth significantly contributes to the national GDP (Gross Domestic Product), creating jobs, attracting foreign investment, and promoting regional prosperity.

Meanwhile, in an interview, acting Cebu City Mayor Alvin Garcia said he believes the city will not experience an electricity shortage in the near future.

Nonetheless, the city is taking steps to ensure that the city will have sufficient power supply.

“We have to invite investments from the private sectors, especially the power generation companies already here. We only have to let them expand their capacity to supply power to Cebu Island,” Garcia said.

NGCP assistant vice president and head for public affairs, Atty. Cynthia Perez-Alabanza said  in an earlier interview that as power consumption continues to rise with the full re-opening of the economy after the pandemic, “all the more Cebu needs more power plants.”

Even amidst the pandemic-induced slowdown, Alabanza said there was a discernible uptick in power demand. “Now, with the economy fully reopening, we are witnessing a substantial surge in power requirements.”

“All roads lead to Cebu when we talk about power consumption in the Visayas,” said Alabanza. — (FREEMAN)