Balancing fuel mix, expanding income base

DMCI Power Corp., the off-grid energy arm of diversified engineering conglomerate DMCI Holdings Inc., is considering venturing into the hydroelectric power business.

Having hydroelectric power stations would give DMCI Power a more diverse income base and to balance its portfolio with non-coal fuel sources, company president Nestor D. Dadivas told reporters.

The company’s prospective hydroelectric power project pipeline would bring about total generation capacity of some 100 megawatts (MW) or more, Dadivas said.

Dadivas said the company was considering, among others, a 9-MW mini-hydropower plant in Cagayan de Oro and several facilities in Sultan Kudarat with a combined capacity of 90 MW.

The company has four sites in Sultan Kudarat that are ready for hydroelectric power development, he said.

Hydroelectric power projects require investments of about $3 million per megawatt, which is higher compared to the required investment of $2.5 million per megawatt for coal, Dadivas said.

The company presently provides power in Masbate, Palawan and Calapan City in Oriental Mindoro via supply contracts with electric cooperatives.

DMCI Power said that to date, it had a total contracted capacity of 59 MW.

DMCI Holdings chair and president Isidro A. Consunji said the company was keen to start investing in renewable energy projects also for diversification.

In 2015, DPC contributed P382 million in net profit to the conglomerate, marking a 57-percent improvement from the level in the previous year. The upsurge was attributed to the increased energy dispatch of its power plants in Palawan, Masbate and Oriental Mindoro.

This year, the off-grid power supplier plans to spend more than P2.2 billion on power plant construction and equipment acquisition.

Set up in 2006 to provide electricity to areas that are not connected to the main transmission grid, DMCI Power contributed P382 million to DMCI Holdings’ earnings last year, higher by 57 percent compared with P243 million in 2014. DMCI Holdings reported a consolidated net income of P12.3 billion in 2015.

DMCI Power recently deployed two satellite diesel-fired plants to Masbate in the Bicol Region with a combined capacity of 175 MW, ensuring reliable power to two towns in the province. DMCI Power said the move came after appeals made by local government units and the Masbate Electric Cooperative or Maselco to address brownouts in Cawayan and Balud.