Small hydropower developer seals deal for second facility in Palawan

interphoto_1387772876MANILA – A company that aims to build 50 megawatts (MW) of small hydropower projects in the Philippines is putting up a second facility in the southern province of Palawan.

In a statement, Langogan Power Corp (LPC) said it signed a memorandum of agreement (MOA) for a 7-MW hydro facility along the BatangBatang River in the town of Narra. Signing in behalf of the local government unit (LGU) and LPC were Mayor Lucy Demaala and company executive Mike Wootton, respectively.

Demaala, who also heads the Palawan League of Municipalities, said LPC will benefit from the full support of all municipalities in the province. LPC and its Norwegian partners are investing more than P2 billion for the Palawan projects.

Jenny Monteagudo of LPC said the MOA with Narra town will encourage the Palawan Electric Cooperative (PALECO) to enter into a power purchase agreement for clean energy.

The Narra hydro plant is expected to generate 32 gigawatt-hours (GWh) a year of clean energy starting 2016, helping reduce 25,693 tons of fossil fuel emissions a year.

“IFC is keen to support the hydro projects directly as well as through BPI via our guarantee facilities.  These hydro projects provide crucial energy resources to support continued growth of tourism in Palawan,” said Jesse Ang, country head of the International Finance Corp, the World Bank’s private-sector investment arm.

The Narra facility is the second project of LPC in the province after its maiden 6.8-MW Langogan hydro plant in Puerto Princesa City. Both projects can provide a combined 25-30 percent of Palawan’s power requirements.

Moreover, the Narra project can help reduce subsidy to state-owned National Power Corp (Napocor) by P180 million a year. Combined with the Langogan project, the annual savings could reach P400 million a year. The universal charge, which is the subsidy to off-grid operations of Napocor, is levied on all Philippine consumers.

The Narra project will sell electricity at the unsubsidized rate of P6.5896 per kilowatt-hour (kWh), lower than the subsidized rate P14.0688-14.75 that PALECO now pays.

“This is just the sort of power sector development cooperation that Palawan needs, the LGU supporting clean and more economic power generation,” said Mario Marasigan, director of the Department of Energy (DOE) Renewable Energy Management Bureau.

Anthony Shibley, chairman of Delta P, welcomes the additional power capacity from renewable sources. “It will help in system balancing and provide additional more economic power, not dependent on imported fuels. We are very pleased to see the support of Narra LGU to the long awaited introduction of hydropower and LPC to the Palawan power sector.”

Delta P operates a diesel-fed power plant that also supplies Palawan.

The Narra project has been endorsed by the Palawan Chamber of Commerce and Industry and the Palawan Alliance for Clean Energy.

Bart Duff President of the Palawan Chamber of Commerce and Industry said; “PCCI had earlier endorsed LPC’s hydro project and have been eagerly awaiting movement on this initiative for several years. We really appreciate the tireless efforts of LPC in pursuing development of affordable and clean energy for Palawan,” said chamber president Bart Duff.

“The Palawan Alliance for Clean Energy views this MoA signing as a significant development in our pursuit of renewable energy for Palawan. We hope that this hydropower project will finally kill off the threat of dirty coal here in Palawan,” said alliance official Gerthie Anda.

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