ArchivesAugust 2010NPC privatization to hike power cost: Noreco 2

NPC privatization to hike power cost: Noreco 2

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Electric cooperatives in the Visayas are asking the government to stop the privatization of the National Power Corporation to avert a spike in the electric bills of its consumers.{{more}}

This stand was aired by officials of the Negros Oriental 2 Electric Cooperative after they foresee an increase in their buying price of power after their contract with the National Power Corporation expires in December 2010.

The Noreco 2 officials told reporters Friday that the government’s move to privatize the Napocor is not working.

Engr. Chito Lozano, Noreco 2 engineering department manager, said that they are currently in negotiations with Greencore which is offering a higher rate than Napocor. “I am not at liberty to divulge their offer because of a confidentiality agreement, but all I can say is that the price will go higher,” he said.

Napocor, which sells power to the Noreco 2 and several other electric cooperatives in the Visayas, was to be privatized in order to attract new foreign players from abroad into the country’s power sector.

The Napocor facility in Valencia, Negros Oriental has been bought by the Lopez-owned Greencore while the PNOC-EDC facilities, which provide steam for Greencore’s power turbines, have been bought by the Energy Development Corporation, another Lopez-owned company.

So far, there has been only one foreign investor in the power sector since the government trumpeted its privatization plan–Keppco. Another investor which is opening coal-fired plants in Cebu and Panay is the First Metro Investment of the Metrobank group.

“Right from the start, it started on the wrong foot. For us, it’s a failure,” said Engr. Chito Lozano, Noreco 2 engineering department manager.
He said the Noreco has joined other electric cooperatives in recommending that the privatization of the geothermal plant in Leyte should be suspended.

“The goal of inviting new investors in the power sector is a failure as only a handful of power plants are being constructed right now and nobody can supply the needed 500 megawatts of power,” Lozano said..

Lozano said the Noreco 2 and other electric cooperatives are working through the APEC party list congressmen to have this move stopped.

The Noreco 2 is mandated by its contract to buy electricity only from NPC. With the privatization of the NPC facility in Negros Oriental, the Noreco 2 now gets its power from the NPC plant in Leyte and sometimes, Luzon. This also results in the lowering of the voltage from 220 volts to below 200 volts, which has been blamed by many for the damage to their electrical appliances.

Noreco has secured a contract with Kepco for a 12 MW base load even as its base demand is already 35.2 MW. “We are short by 23.2 MW for baseload demand,” Lozano said.

A base load is the power needed during non-peak hours.*




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