MANILA, Philippines--PHIL-KOREAN RENEWABLE ENergy Corp. plans to invest $72 million or about P3.24 billion to put up a biomass power plant in Puerto Princesa, Palawan.

According to Phil-Korean chair Won Gul-lee, the company intends to start the construction of a 30-megawatt power plant next month, following the awarding recently of a renewable energy service contract by the Department of Energy.

With this service contract, companies like Phil-Korean can avail themselves of the various fiscal and non-fiscal incentives provided for under the Renewable Energy Law, including a seven-year income tax holiday.

Lee, a former president of Korea Electric Power Co. (Kepco) Philippines, told reporters that the company was planning to use wood chips from ipil-ipil trees as feedstock for the planned power facility.

The company was planning to develop about 80,000 hectares of ipil-ipil plantation to secure the supply of feedstock for the power plant, Lee added.

The proposed biomass power project, which is also expected to provide employment to about 3,000 people, is expected to be completed and to start commercial operations by 2013.

Phil-Korean officials also said the company had already signed an agreement with the sole buyer of the 30-MW capacity, Palawan Electric Cooperative Inc. (Paleco).

Phil-Korea is among the several Korean companies that have expressed interest in investing in the country?s power and renewable energy sector.

Late last year, nine Korean firms visited the country with an end in view of forming joint ventures with local partners for investments in various energy projects in the country.

The nine firms were Hanhwa Corp., Kepco subsidiary Korea Midland PowerCo Ltd., Unison Co. Ltd., Halla Energy and Environment, GS Caltex Corp. II, EcoFrontier, BIO-CDM Inc., KS Industry Co. Ltd., and Korea Water Resource Corp. (K Water).

Hanhwa, Korea Midland and Unison are looking at biomass, and wind power projects in the Philippines.

Halla Energy is also one of the largest energy and environment engineering firms while GS Caltex is the second largest petrochemical firm in Korea. These companies are interested in biomass, mini hydropower, landfill gas and energy efficiency projects.

Eco-Frontier, the leading CDM full-cycle company in Korea, targets to invest in biomass projects, while BIO-CD, a renewable energy developer, and KS Industry, a power, oil and gas firm, are both planning to invest in renewable energy generation projects.