Meralco in P19-B hydroelectric power partnership with REDC

The Manila Electric Co. (Meralco) is venturing into hydroelectric power through a partnership with Repower Energy Development Corp. (REDC), starting with projects worth P18.8 billion. 

The partnership aims to harness the country’s hydroelectric-power capabilities by building and developing mini-hydropower plants using run-of-river resources for renewable and efficient energy production while minimizing their environmental impact.

The joint venture’s first set of hydropower plants will be operational by 2019.

Currently, REDC is developing 100 megawatts (MW) of mini-hydropower projects clustered in Quezon, Camarines Sur, Bukidnon, and other provinces.

Early this month it broke ground in the Rangas mini-hydropower project in CamSur. Its next groundbreaking is the Upper Labayat project in Quezon, scheduled for the first quarter of 2016.

Through its subsidiary Philpodeco, REDC also has three operating mini-hydropower plants in Laguna that sell electricity to Meralco.

“Our wide experience in working with sustainable energy sources has allowed us to maximize its potential through our long term approach of using best of breed international technologies combined with local excellence in deployments” Dexter Y. Tiu, REDC chief executive, said.

The joint venture with Meralco for mini-hydropower projects will make us of the feed-in-tariff (FIT) scheme mandated by the Renewable Energy Act of 2008, where the rate is guaranteed by the government for 20 years at P5.9 per kilowatt hour (KWH).

The partnership marks Meralco’s first foray into mini-hydropower development, a renewable-energy source set to bring forth more than $40 million in annual savings while reducing the country’s carbon dioxide emissions.

Meralco sees the country’s abundant water resources as key to giving millions of power consumers more affordable access to clean, sustainable and renewable electricity.

The joint venture hopes to lead to a series of project groundbreaking of mini hydropower plants starting from the first half of 2016 in select regions, following REDC’s vision for its clustered-development strategy.

The system uses the same transmission lines, infrastructure development and other fixed costs that result in economies of scale.

REDC is a subsidiary of Pure Energy Holdings Corp. It was established in May 2013 and aims to build hydropower plants throughout Luzon, Visayas and Mindanao.

Currently, it has six mini hydropower projects in a single formation totaling 16.6 MW in Quezon, and 21.3 MW spread around in three towns in Bukidnon.

It is also developing several capacity addition projects, one of which is the 10-12 MW Pulangi IV additional capacity project, which is awaiting its hydropower service contract release from the Department of Energy. These projects represent a capital investment of over P7.3 billion for a total of 48 MW of power generation.

Recently, REDC completed the takeover of Philippine Power and Development Co. (Philpodeco), which owns the country’s three oldest operating mini hydropower plants in Laguna that have been operating since 1927 and are selling energy generated to Meralco. An REDC press statement said the company sees huge potentials for the energy sector, as the country is growing at its fastest rate in the last 20 years.