Saturday, 13 March 2010

PGMA orders DBP, LBP to finance firms in solving power crisis in Mindanao

DAVAO CITY, March 13 (PNA) – President Gloria Macapagal-Arroyo has given the Development Bank of the Philippines (DBP) and Land Bank of the Philippines (LBP) the green light to finance projects that will help solve the power crisis in Mindanao.

DBP president and chief executive officer Rey David said in a forum here recently, that the President had instructed DBP and LBP to make available funding to support power companies in the procurement of generating sets.

“We will make funding available for the purchase or lease of generating units with capacity up to 100 megawatts,” David said.

Although saying in a slight quipping manner, David said power rates might markedly soar to as high as P18 per kilowatt hour compared to the current rate of P3 per kilowatt hour. “It might even go higher to P21,” he further said.

David, however, did not elaborate further on the said development even as he noted that financing power corporations was among DBP’s commitments in Mindanao.

In his presentation, David said DBP has P75.4 billion available funds. “This is too much to influence and accelerate sustained growth in Mindanao,” he said, adding that this is part of the big ticket projects in Mindanao, including the agriculture sector and banana exports.

DBP’s net worth is P37.7 billion with a net income of P6 billion in 2009.

Earlier, Davao City Chamber of Commerce and Industry, Inc. (DCCCII) president Engr. Robert Quinto said that the acquisition, or leasing of generating sets, was proposed and discussed by the Mindanao Electric Power Alliance (MEPA) with Presidential adviser and Mindanao Development Authority (MinDA) Secretary Jesus Dureza.

He said availing the financial assistance of LBP and DBP in the purchase or lease of additional power generating sets was also proposed in said discussions.

Quinto said MEPA believed it was the most immediate and doable option to address the power crisis in Mindanao, which has reached critical level.

Quinto also agreed to speculations that if pushed, through, power rates are expected to increase.

At a public hearing on the power situation in Mindanao by the House committee on energy in Davao City last Thursday, first of the recommendations reached for short term solutions is the usage or lease of power barges.

However, the corresponding tariff on barges should be offset by a government subsidy component and the contract period of use of expensive power barge should be limited to three months.

With an anticipated expensive power in the coming days, Mindanaons are expected to pay bigger power rates.

Philippine Air Lines (PAL) senior assistant vice president for Mindanao Domingo Duerme said he was in favor of suggestions that government should subsidize monetary consequences of the power shortage problem in Mindanao to ease the consumers from paying anticipated costly power rates. (PNA)

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