Makati–(PHStocks)–Members of the Panay-Guimaras Power Supply Consortium (PPSC) have signed a 25-year Electric Power Purchase Agreement (EPPA) with Panay Energy Development Corp. (PEDC), a wholly owned subsidiary of Global Business Power Corp. (GBP). GBP is the power generation unit of GT Capital Holdings Inc. (PSE: GTCAP).
In response to the projected power demand in the next two to five years, Iloilo Electric Cooperatives I, II, III, Antique Electric Cooperative and Guimaras Electric Cooperative of the Panay-Guimaras Power Supply Consortium have entered into an agreement with Panay Energy for an aggregate power supply of 24MW at the rate of PhP5.05 per kwH, the lowest offered price of electricity in the Visayas. Purchase agreement will take effect no later than 26 July 2016 and will be sourced from Panay Energy’s 150MW expansion project.
PPSC is an alliance of electric cooperatives in the Panay-Guimaras area for the main purpose of negotiating more competitive prices through aggregation of power requirements.
The PPSC adopted the Swiss Challenge procurement process to secure the best offer for its power supply requirement. Under the Swiss Challenge System, Panay Energy’s proposal went through the competitive bidding process which allowed other power generators to challenge its offer. PPSC President and Iloilo Electric Cooperative (ILECO) I General Manager Engr. Wilfred Billena disclosed that no other supplier matched Panay Energy’s offer.
The Swiss Challenge bidding process is in line with the Electric Power Industry Reform Act’s (EPIRA) primary objective of bringing down electricity rates by encouraging competition. As the bidding process promotes transparency and market-driven rates, GBP Executive Vice President Jaime Azurin commented that the successful outcome of the Swiss Challenge most importantly benefits the consumers of Panay.
“Committed to provide adequate, reliable and cost efficient power supply, we support undertakings that serve the best interest of the consumers,” he said. “We take pride in being able to bring down and offer the best rate in the market through our efficient operations and business approach. As GBP strives to be the most efficient energy provider while responding to the growing energy requirements of the market, the expansion project offers lesser operating cost. We can expect efficient use of fuel from a single larger plant of 150MW that is equipped with the latest Circulating Fluidized Bed (CFB) boiler technology. Likewise, we were able to reduce the project’s development cost for there are existing facilities, like the jetty port, that can be shared with the expansion plant. The cost benefits of our expansion plant enabled us to offer the rate of PhP5.05 per kwH, the lowest offered price of electricity in the Visayas.”
With the construction of the 150MW expansion project, Panay Energy reaffirms its commitment to the Visayas region, by assuring sufficient power supply that can sustain the increasing economic activity in Panay, including the island of Boracay. Moreover, reliability of power supply is considerably improved as Panay Energy locates both existing and expansion facilities near key offtakers to lessen dependence on submarine cables and reduce chances of supply disruptions.
Poised to commence operations by June 2016, construction is already 40% complete and in fact, ahead of schedule. Panay Energy is currently working on the completion of the steel structures and foundation works for the boiler and turbine. Upon commercial operations of the 150 MW plant, Panay Energy will be operating the single largest power generating facility in the Visayas.
GBP, a member of the Metrobank Group of Companies, is one of the leading power producers with plant facilities located in Cebu, Iloilo, Aklan and Oriental Mindoro. Having diversified power generation facilities that are capable of supplying base, intermediate, peak load and ancillary support, GBP offers flexible energy solutions that can serve the varying power requirements of the market.