P4.5b gensets to ease Mindanao power crisis

By Joyce Pangco Panares | Jul. 26, 2013 at 12:01am
President Benigno Aquino III has approved the creation of a P4.5 billion loan facility for the purchase of modular generator sets that can be harnessed  by electric cooperatives in Mindanao.

Aquino, in Executive Order No. 137, said modular generators have been identified by the Department of Energy as “immediate short-term solution to the intermediate electricity needs of Mindanao until baseload power plants come online by 2015.”

The P4.5 billion budget will come from the Malampaya Fund.

Under the new EO, the National Electrification Administration has been given clearance to partner with the Association of Mindanao Rural Electric Cooperatives in implementing the modular generator set program.

In his State of the Nation Address, Aquino acknowledged that the MGSP will cause power rates to go up in the country’s southern region.

“We have helped electric cooperatives bring in generator sets that will reduce brownouts; and this will continue until the plants that will supply the region with more electricity are completed,” Aquino said.

“But the critics will never fully disappear. Some are complaining that the price of electricity will increase with the usage of diesel-fueled generator sets. Hydropower is abundant now because of the rainy season, so we hear objections to the generator sets. But come summer, many will once again complain about eight hour brownouts,” the President added.

Businesses in Mindanao have complained that they are losing as much as 50 percent of their sales as the region’s power situation worsened this year with seven- to eight-hour rotating outages, compared to two- to three-hour outages in 2012.

“We are very much concerned. If this will not be addressed, it will just get worse,” Philippine Chamber of Commerce vice president for Mindanao Ricardo Juliano Jr. said in an earlier interview.

He said the projections are based on conservative estimates, and that the fallout from the power shortages could be much worse.
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