Palm Concepcion Power Corp., a unit of publicly listed A Brown Co. Inc., has signed an agreement with the National Grid Corp. of the Philippines that will allow it to connect its planned 270-megawatt coal-fired power plant in Iloilo City to the national transmission system.
In a disclosure to the Philippine Stock Exchange on Friday, A Brown added that the connection agreement would likewise ensure the dispatch of Palm Concepcion’s power generation output to its customers via the facilities of system operator NGCP.
More importantly, however, the agreement also cements the commitment of Palm Concepcion and its partner, Ayala-led AC Energy Holdings Inc., to proceed with the power project.
According to Palm Concepcion president Roel Z. Castro, the delivery of the Concepcion coal plant’s generated electricity will be coursed through a 40-kilometer double circuit 138-kilovolt overhead transmission line to NGCP’s Barotac Viejo substation.
The coal plant’s output will then be made available to customers of the Visayas Grid via the Negros-Panay and Cebu-Negros submarine cables, he added.
NGCP, for its part, confirmed its commitment to connect the proposed Concepcion plant to the grid through this agreement, according to its chief administrative officer Anthony L. Almeda.
Both officials pointed out that transmission and connection assets were important to the delivery of power from the generation plants to the Visayas grid. Thus, the construction of these transmission facilities should be aligned with the construction schedule of the power plant so that these will be ready in time for the start of commercial operations in 2015.
Palm Concepcion plans to put up two 135-MW coal-fired power units in Iloilo. It earlier signed an agreement with AC Energy to jointly put up the first phase of the project, which is the P12.5-billion 135-MW coal unit.
The proposed coal-fired facility is expected to address the anticipated tight power supply situation in Panay and the Visayas grids by 2015. It is expected that demand for electricity will increase as economic activity expands in the area.
Government figures showed that 2015 will be a critical period for the Visayas Grid, as it will need an additional 100 MW to avert potential power supply shortages. This forecast was derived from a projection by the Department of Energy based on an annual demand growth rate of 4.55 percent.