Napocor losing P1B a month, says chief
MANILA -National Power Corp. (Napocor) is losing P1 billion a month due to the highly volatile price of diesel fuel, prompting more efforts to hybridize diesel-fired power plants in off-grid areas, according to its top official.
Napocor president and chief executive officer Fernando Roxas recently told reporters that his office’s diesel rates were designed to recover P35 per liter.
However, the price of diesel fuel has been soaring to as much as P70 per liter, resulting in more losses for the corporation in charge of operating small power utilities group (SPUG) power plants in off-grid areas.
“Napocor does not have money for energy transition to do it ourselves. We have to invite the private sector to come in and help us hybridize and convert [diesel-fired plants] into renewable energy,” Roxas said.
At present, Napocor operates and maintains 281 mostly diesel-fired SPUG plants across 189 municipalities in the Philippines.
Expensive diesel fuel prices have prompted Napocor to request loans from Land Bank of the Philippines (Landbank) amounting to around P15 billion.
Napocor has already secured P5 billion of this total, and the remaining P10 billion still needs Monetary Board approval and a sovereign guarantee from Malacañang, according to Roxas.
Once the total P15 billion is secured, Roxas explained that it would take the company around four years, or until 2027, to fully pay its debt.
He added that Napocor has so far reached out to 18 companies for potential partnerships to fast-track its renewable energy transition plans, beginning with the hybridization of existing SPUG plants through biofuels and putting up solar plants.
Of this, 90 percent are local companies — some of them the “biggest” in the country — that were willing to finance Napocor’s hybridization projects to lower the cost of power in off-grid areas.
“Once hybridization is successful, the cost of power will lower and eventually, we will be able to pay back our loans,” Roxas said.
Earlier this year, Napocor said it was halting the importation of diesel generating sets in compliance with the Department of Energy’s order to transition its existing technologies into renewable energy.
It also recently partnered with the German-Philippine Chamber of Commerce and Industry to conduct a three-phase feasibility study on the possibility of replacing its diesel-fired generators with green hydrogen and fuel technologies.
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