Mindanao coops urged to tap cheaper solar energy in lieu of modular gensets

Jun 2, 2013

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CAGAYAN DE ORO CITY- Rural electric cooperatives in Mindanao should seriously consider renewable energy options to mitigate the effects of their long-term supply contracts with coal-fired power plants and as a faster and cheaper alternative to the modular diesel generators being pushed by the Department of Energy (DOE).

 

In a recent communication to the South Cotabato II Electric Cooperative (Socoteco II) and the Zamboanga City Electric Cooperative (Zamcelco) Engr. David A. Tauli, engineering consultant with the Office of Rep. Florencio T. Flores, Jr. (2nd District, Bukidnon) endorsed the business model of Lim Solar Philippines which he says is cheaper than both coal and the modular gensets.

 

David Tauli in a spirited discussion with Winston Mendoza

Engr. David Tauli in a spirited discussion with Lim Solar Chair Engr. Winston Mendoza following a recent presentation in Cagayan de Oro City. (photo by Mike Banos, NPN)

“I find their proposal appropriate for both SOCOTECO 2 and ZAMCELCO, who are the only electric cooperatives in Mindanao that have long-term contracts with coal plants,” Mr. Tauli noted. “It is certainly better than the offer being touted by the DOE for ECs to purchase modular diesel generating sets at a cost of PhP 18 per kilowatt hour (kWh).”

 

During a presentation made in Zamboanga City last 15 March 2013, Michael O. Sinocruz, OIC-Chief Planning of the DOE’s Energy Planning and Policy Bureau, disclosed the agency has programmed some 199 megawatts (MW) of modular gensets for Mindanao: 56 MW (Region 12), 48MW (Region 10), 39MW (Region 11), 30MW (Region 9),  22.5MW (Caraga) and 3.5MW (ARMM).

 

Solar Advocates

Solar Advocates Engr. Cecilio Sumaoy of Cepalco, Engr. Cerael Donggay of Greenergy and Lim Solar Phils. Chair Engr. Winston Mendoza in a spirited discussion following a recent presentation in Cagayan de Oro City. (photo by Mike Banos, NPN)

Lim Solar Philippines is offering electric cooperatives (ECs) in Mindanao the lease of its 5-MW hybrid power plant (3 MW solar PV and 2 MW micro gas-turbines that can run 24 hours on either Low or High pressure Natural gas, Biogas from landfills, Flare Gas, Diesel, Gasoline, Methane, Kerosene or even wood) at a fixed price of PhP 7.47 pesos per kWh with a 4 percent yearly escalation for maintenance, monitoring and reporting for 15 years. Coops have the option to purchase the hybrid plant after the 15 yr. lease expires.

 

“The price compares favorably with your coal contracts, which I expect will cost you PhP 8 per kWh or more when it is operationalized in 2016. In contrast, Lim Solar can have the hybrid power plant operational within six months from signing of the lease contract,” Mr. Tauli added.

 

However, since Lim Solar’s initial offer is limited to 5 MW, only one of the electric cooperatives can avail of it, and the others will have to wait for a future offer. This will have to be on first- come-first-served basis.

 

Although Lim Solar also offers affordable financing for the coops, Mr. Tauli suggests the coops also check out the soft loans being offered by the DOE through the National Electrification Administration (NEA) for the purchase of modular diesel gensets to see which better suits their needs.

 

Energy Sec. Carlos Jericho L. Petilla earlier said solar energy power plants need long-term contracts of up to 20 years to make them viable, and may not be a sustainable solution due to their low availability factor of 22 percent.

 

“However, if there is any investor on solar who can convince a cooperative or distribution utility to sign up for 20 years at prevailing solar rate of P9.70 to P12.00 per kilowatt-hour, we would be more than happy to facilitate the transaction,” Mr. Petilla said.

 

Engr. Winston L. Mendoza, chairman of Lim Solar Philippines, said he is not deterred by the DOE Sec. Jericho Petilla’s bias against solar energy in Mindanao. A mechanical engineering graduate of Mapua Institute of Technology, he is also a member of Lions International and the global TAU Epsilon fraternity (66A). He is a retired aerospace information technology at McDonnell Douglas Corporation and former project executive at IBM.

Engr Winston Mendoza of Lim Solar

Engr. Winston L. Mendoza, chairman of Lim Solar Phils. (photo by Mike Banos, NPN)

 

Mr. Mendoza said that for Mindanao, Lim Solar is willing to offer electric cooperatives very minimal prices for solar power as well as 100 percent financing scheme for residential and small businesses.

 

“For Mindanao, I will offer P7.47 per KWh to the electric coops and large megawatt level users and P8.50 to small users. I will also straight finance the residential and small businesses,” he stressed.

 

Lim Solar Phils. (LSP) is a subsidiary of Mendoza Solar, LLC is a renewable energy company registered in California and Nevada, USA.

LSP is the biggest promoter in the country of the use of state-of-the-art portable fuel cell electric systems that address base energy needs, especially of isolated areas.

 

“Our vision for the Philippines is to transition 30 percent of our electric generation to RE and reduce our power cost per kilowatt hour (kWh) by 30 percent by the year 2020,” Mr. Mendoza said. “Our goal is to decrease our dependence on fossil fuels. Currently most of our electrical power is generated by coal-burning, diesel generators, natural gas, geothermal and hydroelectric power plants.”

 

Lim Solar Philippines, which is also chaired by Mendoza, has ongoing solar integration and development projects with De La Salle University, Subic Bay Metropolitan Authority and Camp Aguinaldo. Another affiliate, Lorenzana Energy International has ongoing solar integration and development projects in Malaysia, Hawaii, Guam, California and Nevada.

 

“Solar energy as well as other renewable energy sources is very appropriate for Mindanao if we look at the long term and the impact of climate change, which exacerbates natural phenomenon such as typhoons and storms,” Mr. Mendoza said in a presentation to private investors and electric cooperatives at a local hotel here last week. “For the last several years, Mindanao is now the favorite of natural disasters, whose impacts were exacerbated by climate change-inducing fossil fuels. We can no longer afford to let Mindanao suffer. Solar energy is abundant in the island and it provides clean energy.”

 

The DOE earlier offered three stop-gap measures to improve Mindanao’s power crisis: the creation of an Interim Mindanao Electricity Market (IMEM) where industrial/commercial firms could sell electricity from their gensets; an Interruptible Load Program (ILP) that would compensate consumers who would give up their power allocations to other users by running their own gensets; and the lease/purchase of modular diesel gensets by electric cooperatives through soft loans to be provided by the National Electrification Administration (NEA).

 

 

-INDNJC-

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