SPC Power Corp. plans to develop new hydro-electric power plants following the decision of the Supreme Court declaring the asset purchase land lease agreement over the Naga power plant complex in Cebu invalid.
“With the development of a new power plant at the Naga Power Plant Complex already halted due to the adverse Supreme Court decision, the board of directors of SPC has set its sights on other power project opportunities. New hydropower plant projects are being considered in other parts of Visayas and Luzon,” SPC Power said in a disclosure on Wednesday.
The Supreme court declared as null and void the asset purchase and land lease agreements between SPC and Power Sector Assets and Liabilities Management Corp. covering the Naga power plant complex.
As a result, SPC turned over the Naga power plant to PSALM while PSALM returned the bid of SPC. SPC said before the turnover, only the Cebu Diesel Power Plant with a total dependable capacity of 33 MW had been operating.
The other plants (the Cebu Thermal Power Plants 1 & 2) had been scheduled for dismantling to pave the way for the planned construction of a new power plant.
“Therefore, the immediate effect of the turnover of the Naga Power Plant on SPC’s business is the loss of revenue generated from the Cebu Diesel Power Plant,” SPC said.
The company, however, said it expects to substantially recover the loss with the completion of rehabilitation and full commercial operation of Power Barge 104 (PB 104) within the second half this year.
SPC acquired PB 104 from PSALM in 2016. It has a total dependable capacity of 26 MW after the complete rehabilitation.
“With major overhauling already completed on three engines (one engine still ongoing), PB 104 has been declared for commercial operation effective July 18, 2018,” SPC said.
PSALM turned over the 153.1-megawatt Naga Power Plant Complex to Therma Power Visayas Inc. on Monday following the Supreme Court’s final decision in October 2016
“For PSALM, this event is not just about the Naga Power Plant, it is about PSALM being able to finally resolve old issues and to now focus on its most important work of privatizing the remaining assets,” PSALM president and chief executive Irene Besido Garcia said.
The Naga plant complex is comprised of the 52.5-MW Cebu 1 and 56.8-MW Cebu 2 coal-fired thermal power plants, and the 43.8-MW Cebu Diesel Power Plant 1 consisting of six 7.3-MW bunker-C fed power units. Located in Colon, Naga City, Cebu, the power plants use a combination of coal, bunker C oil, and diesel as fuel.