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Tuesday, December 5, 2023

Gov’t to turn over 1,200-MW Ilijan gas plant to San Miguel

The government is set to turn over the 1,200-megawatt Ilijan natural gas power plant in Batangas province to conglomerate San Miguel Corp.

Energy Undersecretary Felix William Fuentebella said the plant, managed by state-owned Power Sector Assets and Liabilities Management, was being prepared for turnover to SMC.

“There are still ongoing turnover activities this May to June. We asked them to visit the plant,” Fuentebella said, referring to representatives from the Oil Industry Management Bureau, Power Bureau and the Energy Resource Development Bureau.

“Representatives of three bureaus will go to Ilijan plant because we need to look into the details of fuel and power output relating to whether there will be red or yellow alerts going to happen,” Fuentebella said.

He said based on the DOE’s scenario, there would be no forced outages, although there could be yellow alerts or thin power reserves until June.

“We have to immediately respond to whatever scenario that may happen, and that’s why we are visiting the plant itself,” he said.

The Ilijan power plant was constructed and owned by KEPCO Ilijan Corp. under the Energy Conversion Agreement with National Power Corp./PSALM.

SMC through subsidiary South Premiere Power Corp. administers the output produced by the Ilijan power plant under the independent power producer administration agreements with PSALM.

SPPC was appointed the IPP administrator for the Ilijan power plant in 2010.

Under the IPPA agreement, the turnover is scheduled for June this year, upon full settlement of the monthly payments to the government.

SMC offered to pay the capacity charges for the Ilijan natural gas power plant in 2020, or two years ahead of schedule as the funds could be used in the fight against COVID-19.

SMC asked that the turnover of the plant be done ahead of the June 2022 target.

PSALM rejected the proposal amid the dispute with SMC regarding the computation of the generation payments.

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