Beneco, IPs to develop 20-MW hydropower plant
LA TRINIDAD, Benguet — Talks on the proposed putting up of a 20-megawatt (MW) hydropower plant in Kabayan town in Benguet province are almost done between the Benguet Electric Cooperative (Beneco) and the indigenous people (IP) communities in the town.
“Our closest deal is working on a project development proposal with ONKASKA (Onjon ni Kasiguran shi Kabayan), which is the IP of Kabayan and we are getting excited on a 20-MW possibility,” Delmar Cariño, Beneco manager for legal and corporate affairs said.
Cariño said the talks are exploring the possibility of exhausting the provisions of the Indigenous Peoples Rights Act (IPRA) for a partnership between the electric cooperative and the IPs in Benguet for the joint exploration of hydro potentials.
Once completed and made operational, the project will benefit all consumers of Beneco, the IPs and the whole town of Kabayan, he said.
“It will lessen our dependence on coal or fossil fuel. It will enable Beneco to use power from renewable energy,” Cariño added.
Beneco currently averages a monthly utilization of 70MW of power, which is supplied to all types of consumers in its franchise area, covering Baguio and Benguet.
Cariño said the proposed hydropower plant will also redound to lower cost of electricity for consumers, since Beneco would be producing its own electricity supply instead of buying from commercial producers.
“Because the generation facility is embedded within franchise area, the level of generation cost that will be passed on to the consumers will be priced lower and the price per kilowatt hour can also be sold at a reduced price,” the lawyer said.
Beneco, he said, is a non-stock, non-profit distribution utility owned by the consumer-members, thus, it does not need to earn much.
Cariño said under the Electric Power Industry Reform Act (EPIRA), electric distribution utilities are permitted to go into power generation if the source is from renewable energy.
Meanwhile, Beneco’s 3-MW facility in Buguias town in the province is expected to be operational in 2019, the executive said.
Like the agreement in Buguias, after 25 years, the community will co-own the proposed Kabayan power plant, that would be an additional income for Kabayan town.
The income in the first 25 years of actual operation will be held by Beneco, which it will use in paying the loan it will obtain for the establishment of the power generation plant.
“Tataas ang kita nila and we also intend to offer the Buguias model to them,” Cariño said.
Currently, both parties are “finalizing certain agreements while Beneco is also trying to finalize the technical and financial requirement of the project,” he
The IPRA law has a provision on Exercise of Priority Rights (EPR), which allows the indigenous cultural communities (ICCs) and the IPs to dictate the terms of resource development and use of resources within their domain.
Cariño said according to the National Commission on Indigenous Peoples (NCIP), the ONKASKA can use the provision to their benefit.
“ONKASKA is trying to explore their power as Indigenous Cultural Community (ICC) to be the one to dictate how their resources will be used pursuant to the IPRA,” he said.
He said this could be the first time an IP group will use such a provision to their benefit.
“If I am not mistaken, ONKASKA will be the first in the Cordillera region as an IP group to insist on their rights to be the one to dictate the terms of resource development and their resources. That is why they are making use of a provision in IPRA called EPR, wherein one way or the other, you do not exactly conduct an FPIC, the normal one, because under EPR, IP people have the right to be the one to enter into agreement and dictate the terms of their use of their resources,” Cariño said.
“I think Kabayan will be the first that will use the EPR through a joint venture or a partnership,” he added.
After the Buguias model, Beneco is bent on producing a major part of their electricity need to further reduce electricity cost sold to its consumers.
Cariño said Beneco has set-up a “Power Generation Department” within the distribution utility to handle the part, where they will produce electricity, use it, and charge a lower cost of power for the consumers in Baguio and Benguet,
He said exploration for other areas is being done.
“At the moment, there are areas we are exploring in Tuba and even as far as [the provinces of] Ifugao, Kalinga, which are possible projects. We are also consulting with the communities for other potential hydro plants, which our power generation department is focusing on,” Cariño said.
Beneco currently sells electricity at PHP8.24 per kilowatthour for consumers consuming 101-kilowatt hours and above.