Businessman Manuel V. Pangilinan on Thursday said the unit of energy retailer Manila Electric Co. (Meralco) is in talks with a Japanese firm to build possibly a $2-billion gas-fired plant somewhere in Luzon.
Pangilinan, chairman of Me-ralco, told reporters the initial discussions centered on a likely venture with Osaka Gas Co. Ltd. to build a power plant with estimated capacity of 1,200 megawatts (MW) to 1,500 MW.
“It’s under discussion. First, they have to familiarize themselves with the power industry here. They’re relatively new,” Pangilinan said at the sidelines of a briefing organized by Metro Pacific Investments Corp. (MPIC). MPIC partly owns Meralco.
Assuming the talks gain ground, he said the project can begin construction in the next three to five years.
“Capital cost is not as expensive as coal. The capex [capital expenditure] is actually lower than a coal plant per megawatt. But the problem is the higher cost of power. It’s slightly higher than coal,” he said.
“We have to build a re-gas [regasification] facility. There’s no more gas for that size of plant from Malampaya so we have to build a re-gas…import gas inLNG [liquefied natural gas] form, re-gas it and use that as fuel,” he said.
Meralco’s unit will be carried out by Meralco PowerGen Corp. (MGen).
Meralco this week announced that its power-generating arm is in talks with possible partners for power-generation projects, including a planned 1,500-MW power plant in Atimonan, Quezon province.
MPIC said MGen is speeding up investments in new-generation capacity to avert or mitigate the looming supply gaps, notwithstanding earlier legal delays.
It said the San Buenaventura Power Ltd., in which MGen has a 49- percent interest with a right to nominate a preferred investor for an additional 2 percent, is in the advanced stages of developing a new 455-MW supercritical coal-fired power plant in Mauban, Quezon.
San Buenaventura, a joint venture with Electricity Generating Public Co. Ltd. of Thailand, has filed the power-sales agreement with the Energy Regulatory Commission and is currently awaiting the decision to proceed. The plant is scheduled to begin commercial operations in the second half of 2018.
Following the Supreme Court’s clearance to proceed with the project, MGen’s Redondo Peninsula Energy Inc. joint venture aims to complete the 2×300-MW coal-fired power plant within four years.
Global Business Power Corp., in which Meralco has a 22-percent interest, commenced operations of subsidiary Toledo Power Co.’s 82-MW coal-fired power plant last December 2014. Another 150-MW coal-fired power plant is being built in Iloilo City through Panay Energy Development Corp. Equity in this project has been fully funded and commercial operation is expected to start in the third quarter of 2016.