Rody inaugurates 420-MW Pagbilao power plant
President Duterte expressed optimism over the continued business confidence of investors after he led yesterday the inauguration of the 420-megawatt (MW) Pagbilao Unit 3 power project, a coal-fired facility aimed at boosting energy supply in the Luzon grid.
Duterte lauded the opening of the $976-million power facility, which he said would further enhance the business climate and give more Filipinos access to energy.
He also announced the start of operations of the Alegria oil field in Cebu, which he hopes will help boost the economy.
The power plant was developed by Pagbilao Energy Corp. (PEC), a joint venture between TPEC Holdings Corp. and Therma Power Inc., which are subsidiaries of TeaM Energy and Aboitiz Power, respectively.
Energy Secretary Alfonso Cusi and Japanese Ambassador Koji Haneda also attended the inauguration.
Built beginning December 2014, the power plant is adjacent to the existing units 1 and 2 of the Pagbilao power station operated by TeaM Energy. Units 1 and 2 have a total generating capacity of 735 MW.
PEC chairman Antonio Moraza said the project is “cost effective and complies with environmental standards.”
He said the power plant sells power to the wholesale electricity spot market (WESM) to ensure supply security in the power grid, particularly in Luzon.
This is also in preparation for the full open access to spur competition in the power sector, Aboitiz Power chairman Erramon Aboitiz said.
PEC president John Alcordo said the power plant is expected to generate billions of pesos in revenue for the national and local governments in the coming years.
“The growth of the Philippine economy under the administration of President Duterte will certainly translate to a rising demand for energy in the coming years. This project will help address the country’s development needs moving forward,” he said.
“These funds will enable the government to pursue development programs and uplift lives. This is on top of PEC’s commitment to work with our host communities in implementing high impact corporate social responsibility programs to complement the government’s development initiatives,” Alcordo said.
Since it is a coal-fired power facility, Alcordo said the plant is equipped with a flue-gas desulfurizer and is designed to ensure compliance with environmental regulations.
To finance the massive project, the PEC signed an agreement for up to P33.3 billion in debt financing through the joint lead arrangers composed of BDO Capital and Investment Corp., BPI Capital Corp. and First Metro Investment Corp.
SB Capital Investment Corp. serves as co-lead arranger for the project while PNB Capital and Investment Corp. and China Banking Corp. are coarrangers. Philippine Savings Bank also participated as a lender to the project.
The advisers for the Pagbilao Unit 3 project include URS Energy and Construction Inc. (technical); ING Bank N.V., Singapore branch (financing); Latham & Watkins LLP and Puno & Puno Law Office (legal); Aon Singapore Pte. Ltd. (insurance), and Sycip Gorres Velayo & Co. (tax and accounting).