Oriental Energy to operate 10-MW hydro plant by 2013

Oriental Energy and Power Generation is expanding its generation portfolio with its plan to put up a new hydroelectric plant, an official told reporters last week.

The firm is looking to open a 10-megawatt (MW) run-of-river hydroelectric power plant in Cagayan de Oro.

“We expect to start it by the last quarter of next year. We are negotiating either with an electric cooperative in Bukidnon or with Cagayan Electric Power and Light, but we can also sell to the grid,” said Oriental Energy President Caroline L Tanchay.

“It’s just that a long-term contract is more secure,” she said.

The facility is estimated to cost between $30 million to $35 million.

Oriental Energy already has an approved hydroelectric project in Aklan, which it expects to begin construction and operation early next year.

The firm is working on a power purchase agreement for the $60-million, 18-MW Aklan run-of-river hydropower facility, in which the Iloilo Electric Cooperative, 1 will buy all of the plant’s output.

Ms. Tanchay said the firm has already agreed on terms of reference for the agreement.

“We are focusing on renewable energy because it is much more financially lucrative right now and we wanted to take advantage of it,” she said.

She added the firm did not want to focus on coal because “coal in the Philippines is of low quality and we would need to import coal from Indonesia.”

The firm also expressed interest in possibly bidding for government power assets such as the 140-MW Casecnan hydropower plant in Nueva Ecija and other diesel plants.

The government has not yet scheduled the auction for the Casecnan power plant.

Another area Oriental Energy is looking at is the Small Power Utilities Group (SPUG) areas, or the off-grid provinces.

“We’re also entering into some diesel power plant negotiations with SPUG. It’s not yet done but we want to put up diesel-fired plants,” said Ms. Tanchay.

The National Power is auctioning off operation of facilities in SPUG and is prioritizing areas in Palawan and Mindoro.

Two areas, Masbate and Bantayan Island already source power from private firms running generators in the area.

Privatization of SPUG areas involves a competitive bidding among firms who wish to provide power to the off-grid areas. The bidding will allow firms either to operate existing capacities or build new plants.

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