First Gen, Phinma to pursue RE projects

First Gen Corp. and Trans-Asia Oil and Energy Development Corp. of the Phinma group are pushing through with their renewable energy projects worth P27 billion following the issuance of the feed-in-tariff (FIT) rates last week, according to their respective presidents.

First Gen Corp. of the Lopez family and Trans-Asia Oil and Energy Development Corp. of the Phinma group are pushing through with their renewable energy projects worth P27 billion following the issuance of the feed-in-tariff (FIT) rates last week.

First Gen president Francis Giles Puno told the Inquirer that the company intended to pursue the 86-megawatt Burgos wind power project in Ilocos Norte given a FIT rate of P8.53 a kilowatt-hour (kWh), which was lower than the P10.37 a kWh applied for by the National Renewable Energy Board.

The Burgos wind farm will be undertaken by the company’s affiliate, Energy Development Corp., which has allocated earlier this year an initial P6-billion budget to fund the construction of the Ilocos wind farm. It was estimated that EDC might have to spend $2.5 million to $3 million to produce a megawatt of wind power, or as much as $258 million (P11 billion) for the 86-MW wind project.

First Gen, according to Puno, was also pushing through with its planned run-of-river hydropower projects in Mindanao. Priority has been placed on two projects worth a combined P10 billion—the 30-MW Puyo project in Agusan del Norte and the 23-MW Bubunawan project in Bukidnon.

The other Mindanao hydropower projects in the pipeline are expected to be put up in Cabadbaran, Agusan Norte; and Tumalaong River and Tagoloan River, both in Bukidnon.

For hydropower projects, the Energy Regulatory Commission issued a FIT rate of P5.90 a kWh, which was slightly lower than the P6.15 sought by the NREB.

Puno, however, noted that the government still needed to thresh out certain policies that would allow more seamless operations by companies embarking on renewable energy projects.

“The approval of the rates is very helpful but we will still need to clarify the implementation of billing and collection,” he pointed out.

Separately, Trans-Asia Oil president Francisco Viray told the Inquirer that they were also looking to push through with the P6.5-billion 54-MW Guimaras wind farm after having delayed the project for several years due to the absence of the FIT rates. The company, Viray added, would also start mobilizing within the year and start the activities related to the construction of the wind farm.

Trans-Asia Oil has a total of 12 wind service contracts, which account for the bulk of its portfolio with an estimated 400 MW in combined capacity.

Viray earlier said that the company was expected to spend $1 billion for a 400-MW portfolio, based on the general rule that at least $2.5 million would be needed to produce a megawatt from a wind-farm project.

The FIT rates are highly crucial for any renewable energy as these will help determine the financial feasibility of a project. These rates assure developers putting up renewable energy facilities of fixed cash flow for a 20-year period.