ILOILO City – Consumers of MORE Electric and Power Corporation (MORE Power) are expected to benefit from business tycoon Enrique Razon Jr.’s plan to build the world’s largest solar power facility.
Razon, through infrastructure firm Prime Infrastructure Holdings Inc. (Prime Infra), will venture into solar power in a bid to boost the country’s renewable energy supply.
The planned solar power facility will have a capacity of 2,500 megawatts (MW) to 3,500 MW and a battery energy storage system (BESS) capacity of 4,000-megawatt hour (MWh) to 4,500 MWh.
MORE Power president and chief operating officer Roel Z. Castro said the solar power project will help cushion the effects of inflation on fuel prices and even the electricity industry, thus, a big help to the power consumers like the Ilonggos.
Razon owns MORE Power, the city’s sole power distributor in Iloilo City, and International Container Terminal Services, Inc., among others.
“With oil and coal prices going up because of global inflation and the crisis in Europe, this massive solar power project by Prime Infra will cushion and even shield MORE Power consumers from possible rate increases in the future. This is part of our innovative and strategic moves to maintain affordable, stable, and sustainable service to our consumers,” Castro said in statement.
He also noted that the prices of coal and diesel, which are the staple fuel in electricity generation, are also affected by the petroleum price hikes.
MORE Power recently concluded its competitive selection process and signed supply agreements with several power generators, some of which are coal-based.
Meanwhile, the solar project is to be led by Terra Solar Philippines, a unit of Prime Infra’s subsidiary Terra Renewables Holdings Inc., with its partner Solar Philippines Power Project Holdings, Inc.
Terra Solar, which is led by Leandro Leviste, through a negotiated a 20-year power supply agreement, is projected to supply 850MW to Manila Electric Co. (Meralco). This is expected to decrease a total of 1.4 million tons of coal or 930,000 liters of oil in annual consumption in order to generate electricity. This means reduction in emissions of greenhouse gas and the country’s dependency on fuel imports from 2026 to 2046.
Guillaume Lucci, president and CEO of Prime Infra, described this project as “record-breaking” and highlights solar power’s important contribution to strengthening the country’s energy security.
He added that solar, which is normally looked at for peaking, is now being made available by Terra Solar to answer Meralco’s mid-merit requirement, thereby addressing both the need for additional capacity and compliance with Renewable Portfolio Standards.“Prime Infra finds a sweet spot to pursue solar as we take advantage of the steep decline in installation costs over the past decade and the improved battery energy storage system technology that allows us to build an economically critical and socially relevant infrastructure at a scale the world has never seen before,” said Lucci.
According to the US Energy Information Administration, the largest share of total primary energy consumption in the Philippines was petroleum and other liquids (45%), followed by coal (36%), natural gas (7%), non-hydropower renewables (7%), and hydroelectricity (4%).
The price of coal in the world market has soared by more than 300 percent, primarily because of the Russia-Ukraine war which has curtailed global oil supply.
The NewCastle Index, which is the basis for the global coal prices, indicated that prices of coal began spiralling amid the pandemic in 2021 and was exacerbated by the Ukraine invasion.
Russia, which accounts for 10 percent of the world’s oil production, has been subjected to economic sanctions, including oil and natural gas embargoes, after it invaded Ukraine early this year.
From US$93.30 per metric ton (MT) in April 2021, coal prices soared to US$428/MT in May 2022, or a 358.7 percent spike.
The latest index indicated that coal is now priced at US$383.50/MT, which is still a 311 percent increase from the April 2021 index./PN
