Name of Project:
Central Negros Power Project (CNPP); a 50 MW coal-fired
power project
Proponents of project:
The original proponent was Edison Global Electric
Ltd (EGEL), a firm domiciled in Hongkong. EGEL formed the Central Negros
Power Corporation
(CNPC) to become the project corporate vehicle.
CNPC is advertised as a consortium made up of the Ogden Energy Group (an American firm), ABB Energy Ventures BV (a Swiss-Swedish firm), and Edison Global (a Philippine firm).
Ogden will operate and maintain the project under an O&M contract, while ABB will be the EPC contractor. Edison Global is advertised to be an equity investor and will provide strategic project services.
Contractor of project:
Central Negros Electric Cooperative, Inc. (CENECO)
Project cost:
US$100 million, which includes equipment, services, and
financing costs.
Project financing:
The consortium will put up a 30% equity. Financing of
the remaining 70% is reportedly being sourced from EXIM Australia.
History of the project:
The project is intended to serve the franchise area of the Central Negros
Electric Cooperative (CENECO), which consists of the cities of Silay, Bago,
Talisay, and Bacolod, and the town of Murcia. Its first proposed site was
Bago City, about 20 km south of Bacolod, the capital of the province of
Negros Occidental. Residents of Bago learned about this project in October
1997. Concerned citizens worked with the Bago City Mayor and Council, as
well as the women's groups headed by the wife of City Mayor, in undertaking
information dissemination in the barangays of the city to inform the people
of the adverse environmental and health impacts of coal-fired power plants.
In December 1997, the City Council passed a resolution rejecting the coal-fired power project. However, the proponents continued their aggressive campaign to lure the people to accept the project. In January 1998, a coalition of the city officials, Roman Catholic priest and his parishioners, and concerned citizens organized themselves into a group, which planned and spearheaded a protest rally called People's Response to the Coal-Fired Power Plant. Over 20,000 people from all walks of life converged at the Bago City Public Market on January 28, 1998 to publicly and loudly shout their rejection of the coal-fired power project. Consequently, the project proponents left Bago.
The proponents then proceeded to Silay City, about 17 km north of Bacolod. Upon learning of the proponents' arrival in their city, prominent citizens of the city and the local people's organizations formed themselves into the Silaynon Coalition against the Coal Plant (SCRAP Coal Plant). They subsequently conducted information dissemination through the barangay organizations of the Roman Catholic Church. They also undertook a signature campaign while they continuously met with their city officials and declared their opposition to the coal power project. By the end of March 1998, the City Council of Silay passed a resolution asking the project proponents to leave Silay owing to the people's rejection of the plant.
The local newspapers reported that the proponents went to San Carlos City, the northernmost city of the province. However, they did not pursue working there because of San Carlos' distance from the area that would be served by the coal power project.
Many town residents knew the presence of the project proponents in Pulupandan, a town about 30-km southwest of Bacolod, in early August 1998. However, the proponents had apparently began negotiations with the local officials much earlier, probably soon after they were rejected in Silay City. All municipal officials and majority of the barangay officials support the coal-fired power project and have in fact made resolutions favorably endorsing the project. However, the majority of the residents of Pulupandan are against the project. By the end of 1998, almost 13,000 residents had affixed their names and signatures to position papers, resolutions and manifestos stating their reasons for rejecting the plant. There were oppositionists in every barangay of the town. A total of 38 organizations in Pulupandan (14 churches and church groups, 16 community organizations, and 8 school-related organizations) had also put in writing their opposition. Moreover, members of the Montilla family, who own substantial areas of land in Pulupandan, wrote their own position paper against the coal-fired power project. The signatories to the position paper are Corazon M. Sagemuller, Marta R, Kramer, Antonio O. Corral, Jr., Herbert Tomkins, Lourdes L. Gomez, Cecilia M. Leonardia, Anita M. Feria, Hector M. Lacson, Federico O. Montilla, and Cristina O. Montilla.
A signature campaign for 1999 is still ongoing. But there is already an evident increase in the number of oppositionists in several barangays and organizations.
Extent and evidence of opposition to the project:
The opposition to the coal-fired power project in Pulupandan is organized
under the People of Pulupandan against the Coal-Fired Power Plant or PPAC.
This group was organized in August 1998. The group's Coordinator is Ella B.
Jacildo.
Oppositionists to the project from various towns and cities of the province have organized their opposition under the Negrosanons against the Coal-Fired Power Plant or NACP. Formed in February 1999, the group was convened by Romana P. de los Reyes.
Protest activities against the project were earlier organized by PPAC. Since the formation of NACP, both PPAC and NACP cooperated in organizing the protest activities. To date, six protest rallies had been held: 19 September 1998—more than 7,000 Pulupandan residents and support groups from the neighboring towns and cities joined the rally held at the Pulupandan town plaza.
24 October 1998--over 2,000 members of various churches in Pulupandan participated in a prayer rally convened at the Pulupandan town plaza.
14 November 1998—over 1,500 youth from various barangays of Pulupandan and other town residents attended the youth rally at the Pulupandan town plaza.
24 April 1999—over 1,000 Pulupandanons joined a caravan of 41 vehicles from Pulupandan to Bacolod City and staged a protest rally in front of the University of St. La Salle gymnasium where CENECO was holding a general assembly. Oppositionists from the cities of Bago, Bacolod, Talisay and Silay joined the rally.
5 May 1999—some 4,000 Pulupandanons held a protest rally in front of the Pulupandan Municipal Hall, denouncing the resolution of the Sangguniang Bayan, which endorsed the establishment of the coal power project in Pulupandan.
7 August 1999—Over 4,000 Pulupandanons and supporters from neighboring towns and cities participated in the protest rally, which marked the first year anniversary of PPAC's opposition to the coal power project.
Aside from these rallies, PPAC also held Wednesday prayer sessions in front of the Pulupandan Municipal Hall until March 1999.
Residents of other towns and cities have expressed their opposition not only through their participation in protest rallies but also through manifestos, press statements, position papers, and resolutions. To date, the following groups have formally put in writing their opposition to the coal-fired power project:
Local government units
In short, three of the four cities in the franchise area of CENECO, which are supposed to be the beneficiaries of the coal-fired power project, are rejecting the project. The Sangguniang Panlungsod of Bacolod City has not passed a resolution opposing the project but several SP members, as well as the City Vice-Mayor and the Mayor, have publicly declared their opposition to it.
NGOs
Church Groups
Professional Organizations
Moreover, signatories to the position paper of the NACP include a wide range of people, who also represent several sectors. They include
Reasons for the people's opposition:
That the potential damages from the project far outweigh its potential
benefits forms the core of the people's opposition to the coal-fired power
project. Communities surrounding existing coal power plants in the
Philippines attest to the detrimental effects of coal plants. People living
near the coal plant in Calaca, Batangas have experienced increases in
respiratory ailments and difficulties in finding potable groundwater
sources. They also complain of continuing noise and intermittent
explosion-like noise, as well as extremely foul odor. Bleaching of coral
reefs surrounding the coal plant in Masinloc, Zambales has been reported.
Fishermen around the coal plants in Calaca, Masinloc, and in Naga, Cebu
report diminishing fish catch. Communities near the coal plant in Pagbilao,
Quezon experienced a 12-hour ash fall just recently because of failure of
the pollution controls of the plant.
The proponents of the coal power project in Negros Occidental boast that their technology, the circulating fluidized bed boiler or CFB, will control pollution. But CFB addresses only the mitigation of sulfur dioxide and nitrogen oxide emissions. CFB does not control coal dust pollution, coal spillages to the sea, and noise and vibration--problems already encountered in Ogden's coal plant in Mauban, which is still under test operations. Neither does CFB control pollution from ash handling and storage, and the increased temperature of water, as well as the saltier water, that the plant will release to the sea. Moreover, it does not control emissions of particulate matters with a diameter of less than 2.5 microns, as well as of acid aerosols, which cause grave respiratory ailments.
Aside from environmental and health reasons, the Negrenses oppose this coal power project because it is not at all needed in Negros Occidental. The National Power Corporation has confirmed that there is enough, even excess, power supply from the Negros Oriental and Leyte geothermal plants to meet the energy demands of the Negros Island until at least 2006. Inadequacy of transmission lines and lack of substations, not lack of supply, have caused the power interruptions in Negros Occidental.
Considering the substantial excess capacity, there is enough time therefore to develop non-pollutive energy sources. The 1999-2008 Philippine Energy Plan identifies Negros as the site of another geothermal project; it is also identified to be potential wind and ocean energy sites, and as having potential biomass fuels supply. These alternatives are all renewable sources and therefore environment-friendly.
Status of the project:
CENECO and EGEL signed the original contract (Power Supply and Purchase
Agreement or PSPA) in 1994. The PSPA was completely restated and amended
in April 1997 and then amended again in December 1998.
The project does not have the needed licenses and permits as of August 1998. It does not have an accreditation from the Department of Energy (DOE). It was provided a provisional accreditation in December 1997 but this lapsed in December 1998. The proponents are now seeking for a renewal and extension of the accreditation. NACP has filed with DOE its opposition to the accreditation. The National Power Corporation (NPC), the state agency with overall responsibility for power development in the Philippines, has also filed an opposition. NPC's opposition is based mainly on the fact that there is sufficient power from the Leyte geothermal plants (one of the present sources of energy of Negros Occidental) to meet the present and future needs of the Negros Island.
The project also does not have an Environmental Compliance Certificate (ECC) yet. As of the end of July 1999, the proponents had not yet submitted an Environmental Impact Statement to the Environmental Management Bureau of the Department of Environment and Natural Resources.
The Department of Agricultural had recommended that the proposed project site be retained as an agricultural area. The Department of Agrarian Reform, which has the final say on land conversion, has not made a decision on the proponents' application to convert the proposed site from an agricultural area into an industrial/commercial area.
Other national government agencies concerned with the project had also informed NACP that there was no application with their agency regarding the project as of the end of July 1999.
The delays in the acquisition of the needed permits and licenses have led to the postponement of project construction for at least two years now. Such delays can be traced to the strong and widespread opposition to the project.
Other important issues and
concerns regarding the project:
The project is being forced in Pulupandan. But the people of Pulupandan
will not be served by this project because it has been contracted to serve
the CENECO franchise area. Pulupandan is not part of CENECO; it is part of
another franchise area—NOCECO.
The project proponents have not faithfully observed the process and procedure for Environmentally Critical Projects as prescribed in the Department of Environment and Natural Resources Administrative Order No. 37, series of 1996 (DENR DAO 96-37). PPAC and NACP have informed EMB/DENR of the proponents' specific violations of DAO 96-37.
Two firms involved in the project—Edison Global Electric Ltd and Edison Global—are not registered with nor are they licensed to do business in the Philippines by the Philippine Securities and Exchange Commission (SEC). At the request of NACP, SEC, through its Prosecution and Enforcement Department, is now undertaking an investigation on these firms.
The Municipal Mayor of Pulupandan, his wife, and his immediate family members own the proposed site for the coal-fired power project. The Mayor's endorsement of the project is thus self-serving. The Mayor stands to gain enormous financial benefits if the coal plant would be established in Pulupandan.
There is a concerted effort to obtain approval for land conversion for the coal power project site through “backdoor tactics.” Specifically, members of the family of the Pulupandan Mayor have formed a corporation that will establish a special economic zone or ecozone in Pulupandan. Once a Presidential Proclamation for the ecozone is released, the land conversion becomes automatic. The brother of the mayor earlier vehemently denied any connection between the power project and the ecozone project. In fact, however, the December 1998 Amendments to the contract for the coal power project specifically states that an ecozone would be established in the project site and the power project would be registered as an ecozone strategic locator. NACP informed the Philippine Economic Zone Authority (PEZA) about the effort to use the ecozone as a ploy to establish the power project and to circumvent the land conversion requirement for the power project. PEZA has approved the ecozone project, but it notes that the power project is not part of the ecozone. NACP is concerned, though, that it might just come out one day that the power project has become a component of the ecozone.
NACP is also concerned about the involvement of a close relative of President Joseph Estrada in the coal-fired power project. The project proponents have contracted Woodward-Clyde Philippines, Inc. (WCPI) to undertake the Environmental Impact Assessment for the project. The Managing Director of WCPI is Robert Raul de Guzman, who is the Presidential Consultant on Environment and Water. He is also a nephew of President Estrada. The supporters of the project had earlier bragged that the nephew of the President had already approved the EIA. However, because in fact the EIA has not been completed, the pro-coal plant supporters subsequently said the nephew of the President would work out the approval of the EIA. They further brag that people close to the President will facilitate the approval of the licenses for the project.
The project proponents have waged an intensive campaign to mislead the people about the nature of the project. They stress that the project is a “build-operate-and transfer” (BOT) project, thereby making people think that the national government has endorsed and approved it because under the BOT law, a BOT project is one between a government agency and a private entity. The truth, however, is that this coal-fired power project is an entirely private endeavor, hence, it does not need to obtain approval of the National Economic Development Authority or NEDA.
Yet NACP has also unearthed a letter which shows that CENECO earlier sought from the National Electrification Administration (NEA, the agency which supervises electric cooperatives such as CENECO) the issuance of a “performance undertaking” for the project. Such document is needed in order for the project to obtain government guarantee of its obligations to the project lenders. If the project still seeks to obtain this performance undertaking, then the project proponents and the CENECO officials are lying to the people of Negros. They claim that this project will not involve any centavo from the Philippine government coffers.
The project proponents are enticing the municipal and provincial officials
of Negros Occidental to accept this project because it will provide cheaper
electricity. They are keeping it from the public that they are in fact
still “shopping around” for various financial incentives or tax exemptions,
particularly from the Bureau of Investment and the Philippine Economic Zone
Authority. Will they be able to provide the cheaper rates if they could not
obtain any financial incentives? The project proponents are also keeping a
secret the fact that the contract on this project states conditions under
which the proponents will pass on to CENECO the tax payments, which will
undoubtedly be passed on to the consumers, too. Moreover, the contract has
provisions stipulating various conditions under which the power cost will
increase so that the proponents' economic returns will remain the same
despite the imposition of taxes or other fees by the Philippine government.
