VECO backs TransCo Kepco-Salcon supply deal
Saturday, July 29, 2006
By MYRNA M. VELASCO
With all fingers pointed at them supposedly instigating the ouster of current National Transmission Corporation (TransCo) president and chief executive officer Alan T. Ortiz, the Aboitiz-owned Visayan Electric Company (VECO) finally broke its silence and indicated that it posed no objections to the deal inked by the spinoff transmission firm for the 200-megawatt coal-fired power project of Kepco-Salcon Power Corporation.
"Contrary to some reports, the VECO welcomes the initiative taken by the TransCo to sign a contract with the 200-MW power plant proposed by Kepco-Salcon Power Corp. for construction in Naga, Cebu," the utility firm said in a press statement, adding that "this move aims to address the power supply requirements of the Cebu-Negros-Panay grid."
In the face of swirling controversy surrounding the TransCo chief’s fate over the deal, the Aboitiz-controlled VECO extends a hand of cooperation, expressing that it "would be happy to sit down with the concerned parties to explore and understand how it can input this additional capacity into its future power demand requirements."
The utility firm added that VECO "looks forward to understanding more about the contract details and its ramifications to the power cost of the Cebu-Negros-Panay grid."
Indicating that it is not actually privy to the details of the agreement, VECO stressed that it sees the deal "as a very positive move to bring power to the Cebu-Negros-Panay grid."
It would be noted that Ortiz’s reported ouster embraced newspaper headlines in the past few days, alleging that the primary reason was the complaint lodged by the Aboitiz group to President Arroyo on TransCo’s bid to procure supply from the Kepco-Salcon power project for its ancillary service requirements.
Aside from TransCo, other attached agencies of the Department of Energy (DoE), primarily the National Power Corporation (NPC) was also a signatory in the multi-party deal. The Kepco-Salcon facility is still designed as a merchant venture, eyeing other distribution utilities and end-users in Cebu as potential offtakers.
VECO further averred that "the impending increased power supply in the island of Cebu allows VECO to have alternatives for sourcing its supply for future power requirements," ensuring that its customers will be afforded reliable and competitivelypriced power either through the Wholesale Electricity Spot Market or bilateral supply contracts that would be approved by the Energy Regulatory Commission.
The Kepco-Salcon venture has been among the parties that submitted interest when VECO solicited tenders for its additional supply by years 2010 and 2011.
In its notice to potential bidders, the utility firm emphasized that the plant shall have a gross capacity of 100-MW deliverable by January 1, 2010; and the other 100-MW shall be set on stream by January 1, 2011.
The bidding terms though was subsequently changed, with VECO pining for a power facility designed with four units of 50-megawatt volume of generation each.
As forecasted, the power supply of VECO will go up to 354 MW starting 2010; thus, the need for additional 200 MW tucked into its system.
The power facility being solicited also set outs specification that it shall be capable of operating on a baseload mode and shall have an operating life of 25 years.(MMV)
posted by philpower @ 5:07 PM,
