Gigawatt Power Inc, a lead player in a joint venture consortium – together with its partners Vivant Corporation and WEnergy Global – has been selected by Busuanga Island Electric Cooperative (BISELCO) as its New Power Provider (NPP) for the islands of Culion and Linapacan, in the Philippines.
It is the first ever renewable energy deal on these group of islands (and Philippines), because it combines solar power with diesel generators and energy storage to produce power. “This joint venture is significant, because it accelerates the urgent electrification for economic development of areas by combining new and clean technologies with private sector discipline to deliver quality electricity to consumers.” said Walden H. Tantuico, President & CEO of Philippine-based Gigawatt Power Inc.
The joint venture (to be incorporated under the name CULNA Renewable Energy Corporation, CREC) was unanimously selected by the Board of Directors of BISELCO after a tender process and based on the track record of the three parties in the Philippines with power generation and micro-grids.
“We started the negotiations with BISELCO and relevant national agencies on the Power Supply Agreement and expect to sign this in January 2016,” said Atem S. Ramsundersingh, CEO of WEnergy Global, a Singapore-based company. WEnergy Global believes that partnerships with local power companies and international and local investors and financiers can accelerate and boost electrification in Asia. It is about ‘pooling’ resources and mobilizing the best of knowledge and experience in every partner to ensure quality services, clean and quick. The ASEAN market opportunity is estimated at US$27 billion per year up to 2030 for investments in transmission and distribution networks, while US$3 billion per year in renewable power generation infrastructure up to 2030. We want to take pride on doing things clean and quick and contribute to the fight against global warming while also capturing a slice of this.”
Ruth Fortes, General Manager of BISELCO said: “The NPP, through the deal, aims to provide electricity to two emerging islands- Culion and Linapacan, to more than 2,500 businesses and households on a 24/7 basis. The power project will boost the economies of the islands by enabling small and large companies to operate hotels, resorts, ice factories, fish processing facilities, while households will enable their children to study at night, parents can do their home-jobs and entertainment to be boosted”.
The consortium is proposing a Diesel-Solar PV-Clean Battery Hybrid solution aiming at reducing the diesel consumption by 50% (and related logistic challenges to transport fuel to the islands) and at reducing government subsidies for such off-grid locations in the Philippines.
“Our hybrid solution, developed by WEnergy Global, compared to diesel, will save the government between US$5-7 million during the 20-year lifetime of the operations. In addition we also will reduce carbon-emission by more than 50,000 metric tons over its life-time, which is equivalent to over 1 million liters of gasoline per year less burned. Why? Because the sunlight is free and gives a ‘constant price’ over its lifetime, while diesel is subjected to political volatility in oil producing countries and the price is assumed to increase, no matter the fact that it is currently low. Besides, transporting diesel in ships is a risk and not reliable given the wild sea conditions,” said Gigawatt Power’s President & CEO Walden H. Tantuico.
The parties involved in the current JV intend to get the power plant operation in about 6-8 months from date assuming that approvals from respective government agencies are obtained without any major delays.
Gigawatt Power, Vivant Corporation and WEnergy Global are already working together in the Sabang Renewable Energy Corporation (SREC) in Palawan, the Philippines, on a Micro-Grid Project near Puerto Princesa’s Underground River, a UNESCO World Heritage site. This project is unique as it will be the first commercially operated project that will provide 650 large and small customers with clean electricity on a 24/7 basis. The project consists of power generation and a distribution network of 15 kilometers, using solar, diesel and batteries to provide 50% clean power to the consumers. This area is not connected
to the regional grid and is considered an off-grid area where electrification can boost the local economy. Micro-grids, powered by clean energy sources, are quickest way to electrify over 150 million people in ASEAN still without power.
Ramsundersingh, CEO of WEnergy, said: “The demand for power in Asia is huge. If we would be able to connect 50% of those not yet connected in the next decades, we would be truly champions. But we won’t, because the government decision-making machinery isn’t efficient and effective. Through such foreign/local joint ventures we are able to push and pull to address the urgency in off-grid areas in Asia. We are able to boost economic development along principles for green-growth i.e. aiming at zero pollution of soil, water and air and harm to all sort of life on this planet.”
In spite of the challenges Ramsundersingh, added there is tremendous growth potential for the company in the region.
“In Myanmar, Indonesia, Lao PDR, Cambodia and Philippines alone over 150 million people are still not connected to power. Micro-grid power by solar, diesel or tidal power from rivers and the sea, can be deployed within 7-10 months. Waiting for the central governments to connect remote areas with power through the conventional grid could take ages i.e. over 10-20 years. WEnergy Global is being recognized for the micro-grid technology and the business model and has now submitted an expression of interest to the Indonesian power company and the KfW Development Bank (Germany) for an implementation contract of 94 mini-grids on 21 islands in Nusa Tenggara Timur (NTT) to be powered by hybrid-sources such as solar, tidal, diesel, biomass etc.”
Gigawatt Power Inc and Vivant Corporation are individual power companies based in the Philippines, owning and operating both conventional and renewable power generating and distribution assets. WEnergy Global is a one-stop-shop solution provider in renewable energy systems, develops, finances, owns and operates RE-based power assets, mainly in ASEAN. WEnergy Global received the Erasmus Energy Business Award 2014 from the Future Energy Business Center of the Rotterdam Business School, in The Netherlands.
Culion, with a population of around 20,000 residents, is part of the Calamian group of islands situated at the northern part of Palawan, approximately 200 nautical miles southwest of Manila (see map below). It is bounded on the north by Busuanga; on the east by Coron Island; on the west by West Philippine Sea; and on the South by Linapacan Island.
In the Philippines, 30% of rural households (about 4 million households or 25 million people) are situated in off-grid areas, which are not connected to the national transmission grid. Power supply in these off-grid areas is mandated to electric cooperatives (EC) operating local distribution grids. Power is usually supplied from diesel generators operated by the Small Power Utilities Group of the National Power Corporation (NPC-SPUG) for periods varying between 6-24 hours per day, depending on the site. Over 290 off-grid areas are being served by NPC-SPUG as part of its mandate to implement missionary electrification (ME).