State-run National Power Corp. (NPC) will give renewable energy company Emerging Power Inc. a subsidy for providing geothermal power in the province of Mindoro, it was learned Friday.
The amount was not disclosed, but it will come from the Universal Charge for Missionary Electrification (UCME) fund, a provision under the Electric Power Industry Reform Act (EPIRA) designed to ensure the delivery of reliable electricity to marginalized areas and those that are not connected to the main grid.
EPI is getting the subsidy after it recently started construction of its geothermal power plant in Mindoro and signed a power supply agreement with two electric cooperatives in the province.
The two electric cooperatives were Oriental Mindoro Electric Cooperative (ORMECO) and Occidental Mindoro Electric Cooperative (OMECO).
However, the government’s plan is for NPC to eventually remove the subsidy.
In the meantime, the subsidy will allow EPI to deliver its 40-megawatt (MW) geothermal power plant in Naujan, Oriental Mindoro.
EPI President Martin Antonio Zamora said the firm’s geothermal project would bring Mindoro to energy independence.
“This UCME agreement is a testament that renewable energy is not only good for the environment, but is also friendly on the pocket,” Zamora said. “The island will be the ‘poster boy’ for clean, reliable, and cost-efficient energy.”
EPI’s 40MW geothermal project is expected to cut the cost of power generation in the island by half, as it would no longer depend on rising world oil prices.
EPI claimed that at 92 percent plant utilization, the UCME subsidy allotted for Mindoro would significantly decrease.
The project is expected to deliver its first 10 MW by April of 2017.
EPI is majority owned by Nickel Asia Corporation (NAC), one of the country’s biggest mining firms listed at the Philippine Stock Exchange.
In a past disclosure, NAC said it would guarantee the loan facility of EPI for up to P3 billion over a three-year period to finance EPI’s renewable energy projects.
EPI is also putting up a 100-MW geothermal power plant in Biliran, a 150-MW solar and wind park in Subic, a 35-MW Solar Hybrid plant in Palawan, and a 10-MW solar project in Camarines Sur.