MINDANAO POWER CRISIS | US subsidiary guarantees 'cheap' electricity from hybrid source

Lim Solar Philippines chairman Winston Mendoza demonstrates benefits of installed solar power. Photo by Bong D. Fabe means BUSINESS

CAGAYAN DE ORO CITY— A subsidiary of a US-based renewable energy company is offering households, electric cooperatives and small and medium enterprises (SMEs) in this city 100 percent financing for putting up hybrid power plants.

“For Mindanao, I will offer P7.47 per kilowatt-hour (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,” Winston L. Mendoza, chairman of Lim Solar Philippines, told participants during a “Lunch and Learn” presentation at a posh hotel here recently.

Lim Solar is a subsidiary of Mendoza Solar LLC, a company that operates in California and Nevada. The Philippine unit is offering Mindanao electric cooperatives the lease of its five-megawatt (MW) hybrid power plant at a fixed price of P7.47 kWh for 15 years. Thereafter, electric coops have the option to purchase the plant, which is a combination of a 2-MW solar photovoltaic facility and 3-MW gas turbine.

Mendoza, who also chairs the Mendoza Solar as well as another affiliate, the Lorenzana Energy International, said the hybrid power plant will be operational within six months from the signing of contract with electric cooperatives.

 “The price compares favorably with your coal contracts, which I expect will cost you P8.00 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," Mendoza said.

If plant commissioning went beyond six months, then he is willing to pay P10,000 for every week of delay.

“But once we finished the construction ahead of schedule, you have to pay us P10,000 for every week we deducted from the delivery target,” he said.

Mendoza — whose companies have ongoing power projects with De La Salle University, Subic Bay Metropolitan Authority and Camp Aguinaldo, as well as in Malaysia, Hawaii, Guam, California and Nevada — said solar energy is very appropriate for Mindanao, especially since the island is in dire need of electricity to meet development demands.

"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. 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,” he said.

Mendoza said his companies’ vision is to wean the Philippines from its dependence on fossil fuels as well as “reduce our power cost per kilowatt hour by 30 percent by 2020.”

"Our vision for the Philippines is to transition 30 percent of our electric generation to renewable energy. Currently most of our electrical power is generated by coal-burning, diesel generators, natural gas, geothermal and hydroelectric power plants,” he stressed.

The Department of Energy earlier ruled out using solar power in Mindanao, as doing so would only jack up the cost of power.