Covid-19 causing delivery delays for solar panels, stalling MGen projects
By Lenie Lectura – February 27, 2020
from Business Mirror
THERE is a delay in the two solar power projects of the Meralco PowerGen Corp., the power generation arm of (Meralco), because of the 2019 coronavirus disease (Covid-19).
These are the 50-megawatt solar power facility in San Miguel, Bulacan and the 40-MW solar power project in Tarlac.
“We have two solar projects we are involved in. One in Bulacan and one in Tarlac. Both are experiencing delays in the delivery of PV panels from China. The other projects are still not affected,” said MGen president Rogelio Singson in a text message Wednesday.
On Monday, the MGen official said that while “construction is a go” for the solar power projects, “there is a delay in the delivery of panels” due to the Covid-19 disease. However, he said, “fencing is almost done, site clearning is almost complete.”
The travel ban imposed to and from China was cited as the cause for delay in the delivery of the solar panels.
“We really can’t say at this time until we see the panels delivered on site,” said Singson when asked for the schedule of the solar power facility’s commissioning.
The Bulacan solar project is the company’s first solar investment, according to Singson.
It will be put up by PowerSource First Bulacan Solar Inc. (PFBSI) at a cost of P4.25 billion.
PFBSI is 40-percent owned by MGEN Renewable Energy Inc. (MGreen), 36 percent held by PowerSource Global Holdings Corporation (36 percent) and 24 percent by Singapore’s Sunseap International Pte. Ltd.
MGreen, the renewable energy subsidiary of MGen, has tapped SUMEC Complete Equipment & Engineering Co. Ltd. to construct the solar facility in Bulacan.
‘Lego pieces’
Despite the setback, MGen is still committed to achieve its target RE portfolio of 1,000MW over the next five to seven years. The focus is on the development of a portfolio of utility-scale solar, wind and hydro-power projects to supply Luzon grid and electricity consumers with competitive tariff.
“This start is one of the Lego pieces that will make a thousand,” Singson earlier said.
MGreen recently secured an equity funding of P424 million from Meralco to be invested in various solar projects.
The power to be produced from PFBSI will be sold to Meralco under an approved 20-year power supply agreement (PSA) for P4.69 per kilowatt hour (kWh), subject to 2-percent annual escalation.
The rate, the Energy Regulatory Commission (ERC) has said, is “reasonable” because the PSA underwent the competitive selection process (CSP). Even with the application of the 2-percent annual escalation, the rate of P4.69 per kWh is “still significantly lower than the prevailing feed-in-tariff (FiT) rate and most of the approved rates for solar power plants.”
From P4.69 per kWh, the rate will go up to P5.7516 per kWh on the 20th year. The ERC said this is still lower than the prevailing FiT rate of P8.69 per kWh for solar.
The 20-year term of the PSA will not be extended, the ERC said.
