Lanao Kauswagan power station
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Lanao Kauswagan power station is a 552-megawatt (MW) coal-fired power station in Lanao del Norte Province, the Philippines.[1]
Location
The map below shows the plant's site, in Libertad & Tacub Barangays, Kauswagan Municipality, Lanao del Norte Province.[2]
Background on Plant
GNPower Kauswagan, a joint venture of the Ayala Corporation and shell company Power Partners Ltd. Co., is building a four-unit coal-fired power plant with a total planned capacity of 552 MW in Lanao del Norte Province.[3] In May 2014, Ayala put the cost of the plant at US $1 billion.[4] In July 2017, the cost of the project to date was estimated by one observer to be US $2.5 billion.[5]
GNPower began site clearing work in August 2013, having signed an agreement for sale of 330 MW of power from the plant to Power Supply Aggregation Group Corp. (PSAGCorp), a group of Mindanao electric cooperatives.[6] Environmental permits for the project were issued in March 2014.[7]
In May 2014, GNPower signed an engineering, procurement, & construction (EPC) contract with Shanghai Electric Power Construction, a subsidiary of Power Construction Corporation of China.[4] The final financing agreement was signed in December 2014, with a syndicate of domestic and international banks.[8] The state grid operator, the National Grid Corporation of the Philippines, announced plans in January 2015 to build a new 230-kilovolt transmission line to connect the plant.[9] Construction on the plant is slated to begin in early 2015, and is scheduled to be completed by the end of 2017.[8]
In July 2015, the project appeared to be entering construction. AC Energy Holdings president Eric Francia told reporters, “For Kauswagan, we have made the financial commitment. We have started the project. The engineering design is ongoing [and we just want to] clear the property... We are hoping to go full blast in a month or so.”[10]
In July 2016, AC Energy Holdings announced that it secured funding for Unit 4 of the plant. The project will be funded by 70 percent debt from domestic and foreign banks, plus 30 percent equity.[11]
In October 2019 the Philippine Competition Commission (PCC) approved the purchase of shares of three subsidiaries of Ayala Corporation’s energy division, AC Energy Inc., by US-based holding company Proverbs 16.[12] Ayala's interest in the Lanao Kauswagan power station was sold to Power Partners Ltd.[13] Ayala in April 2020 announced that it would divest entirely from coal by 2030.[13]
Delays in commissioning schedule
As of February 2017, Unit 1 was scheduled to come online in Q4 2017, and Units 2 & 3 in 2018.[14] In November 2017 it was reported the power station would be completed in 2018.[15]
As of September 2018 construction of all four units was scheduled to be complete by December 2018, with Unit 1 scheduled to come online in March 2019, Unit 2 in May 2019, Unit 3 in June 2019, and Unit 4 in August 2019.[16]
In March 2019 it was reported that the units would be commissioned in May, July, September and October respectively.[17] Unit 1 was commissioned in June 2019.[18] Unit 2 was commissioned in July 2019.[19] Unit 3 was commissioned in December 2019.[20] Unit 4 was commissioned in October 2020.[21]
Power Purchase Agreement troubles
In February 2023, the power station's owner stated that they faced "financial ruin" unless Davao Del Sur Electric Cooperative paid 1.37 billion pesos ($24.93 million USD) owned under the provisions of a 2012 power purchase agreement. According to GNPower Kauswagan Ltd. Co., they were seeking to recover payments for deferred power generation capacity from June 2020 to September 2022.[22]
Financing
Units 1-3
In September 2015, a financing agreement for units 1-3 was closed. US$435 million in loans was provided by Rizal Commercial Banking Corporation, Security Bank, Bank of the Philippine Islands, United Coconut Planters Bank, and Land Bank of the Philippines. US$520 million in equity was provided by Ayala Corporation, Power Partners, and Philippine Investment Alliance for Infrastructure. Yorick Advisory acted as financial adviser for the sponsors, and RCBC Capital Corporation acted as financial adviser for the lenders.[23]
Unit 4
In June 2016, the project reached financial closure after it secured US$765 million in loans from Rizal Commercial Banking Corporation, Security Bank, Bank of the Philippine Islands, Development Bank of the Philippines, Cathay United Bank, Prudential Capital Group, Land Bank of the Philippines, United Coconut Planters Bank, and Bank of China. US$280 million in equity is being provided by Power Partners, Philippine Investment Alliance for Infrastructure, and Ayala Corporation. OptAsia Capital is the financial advisor for the project.[24]
IFC Involvement
In 2017, the Philippine Movement for Climate Justice lodged a formal complaint against the International Finance Corporation (IFC) for its involvement in Philippine coal-fired power stations. The complaint alleged that the IFC had funded these projects through its financial support to Rizal Commercial Banking Corporation (RCBC). The Lanao Kauswagan power station was one of 11 power stations for which the IFC's involvement was found to be sufficient to trigger the IFC's internal accountability process.[25]
Citizen Opposition
In a march organized by the Coal Resistance Movement, an estimated 300 people walked 92 kilometers across Lanao del Norte province to protest the Lanao Kauswagan power station and a proposed 20 MW coal plant inside the La Farge cement factory in Kiwalan, Iligan City. The march passed through the towns of Lala, Tubod, Kolambugan, Bacolod, Kauswagan, and Linamon, culminating in Ilgan City in front of La Farge. The group of marchers, which included school children, sought to draw attention to the effects of the plants on the rich marine environment resources of Panguil Bay and Iligan Bay.[26]
Project Details
- Sponsor: GNPower Kauswagan
- Parent company: Power Partners Ltd.
- Location: Libertad & Tacub Barangays, Kauswagan Municipality, Lanao del Norte Province, Philippines
- Coordinates: 8.18691, 124.11545 (exact)
- Status: Operating
- Gross Capacity: 552 MW (Units 1-4: 138 MW)
- Type: Subcritical
- In service: Units 1-3: 2019; Unit 4: 2020
- Coal Type:
- Coal Source:
- Source of financing: Units 1-3: US$435 million in debt from Rizal Commercial Banking Corporation, Security Bank, Bank of the Philippine Islands, United Coconut Planters Bank, and Land Bank of the Philippines; US$520 million in equity from Ayala Corporation, Power Partners, and Philippine Investment Alliance for Infrastructure[23]
Unit 4: US$765 million in debt from Rizal Commercial Banking Corporation, Security Bank, Bank of the Philippine Islands, Development Bank of the Philippines, Cathay United Bank, Prudential Capital Group, Land Bank of the Philippines, United Coconut Planters Bank, and Bank of China; US$280 million in equity from Power Partners, Philippine Investment Alliance for Infrastructure, and Ayala Corporation[24]
Articles and resources
References
- ↑ GNPower Projects, GN Power, Accessed May 25, 2021
- ↑ GNPower Kauswagan begins Lanao del Norte coal-fired power plant construction, Iligan City website, 29 Aug. 2014.
- ↑ 552-MW Mindanao coal facility to open next year, Manila Standard, Nov. 27, 2017
- ↑ 4.0 4.1 AC Energy’s GNPK Signs EPC Contract for 552MW Thermal Plant in Mindanao, Ayala Corporation press release, 5 May 2014.
- ↑ 2.5-B Kauswagan power plant rises, OpinYon, 10 Jul 2017.
- ↑ Flores, Alena Mae. Ayala, GN Power clear site for Lanao coal plant. Manila Standard Today, 31 Aug. 2013.
- ↑ Private Sector Initiated Power Projects (Mindanao), Philippines Department of Energy, 30 Sept. 2014.
- ↑ 8.0 8.1 Ayala unit signs financing deal for Lanao coal plant, ABS-CBN News, 29 Dec. 2014.
- ↑ Fusilero, Kristianne. Grid firm to set up line for power plant. Mindanao Times, 7 Jan. 2015.
- ↑ Alena Mae S. Flores, "GNPower prepares coal power plant in Lanao del Norte," The Standard, July 24, 2015
- ↑ "Funding secured for fourth unit at Philippine coal-fired plant," Power Engineering, July 5, 2016
- ↑ Antitrust body paves way for Ayala exit from Mindanao power plant, Philippine Daily Inquirer, Oct. 10, 2019
- ↑ 13.0 13.1 Ayala to fully abandon coal investments by 2030, Phil Star, Apr. 20, 2020
- ↑ 1st unit of 540-MW GN Power to start end of 2017, Minda News, 25 Feb. 2017.
- ↑ "552-MW Mindanao coal facility to open next year," The Standard, November 27, 2017
- ↑ 2018 Private Sector initiated power projects in Mindanao (committed), Department of Energy, Republic of the Philippines, September 2018
- ↑ Victor V. Saulon, "Coal-fired plant classified ‘of national significance’", Business World, March 29, 2019.
- ↑ Unit 1 of Coswagen, Philippines, handed over to the owner for commercial operation, CPNN, Jul. 3, 2019
- ↑ http://news.bjx.com.cn/html/20190716/993009.shtml 菲律宾考斯瓦根4×135兆瓦燃煤电站2号机组顺利移交], BJX, Jul. 13, 2019
- ↑ List of Existing Power Plants, Philippine DOE, 31 Dec. 2019
- ↑ List of Existing Power Plants, Philippine DOE, 31 Dec. 2020
- ↑ Coal plant firm demands P1.37b from Dasureco, Manila Standard, 19 Feb. 2023
- ↑ 23.0 23.1 "Preview of Kauswagan Coal-Fired Power Plant Phase I (414MW) | Transaction | IJGlobal". ijglobal.com. Retrieved 2020-11-19.
- ↑ 24.0 24.1 "Preview of Kauswagan Coal-Fired Power Plant Phase II (138MW) | Transaction | IJGlobal". ijglobal.com. Retrieved 2020-09-22.
- ↑ CAO ASSESSMENT REPORT Regarding Concerns in Relation to IFC’s Investment in Rizal Commercial Banking Corporation (RCBC) – 01 (#30235, #32853, #34115, #37489) in the Philippines, IFC Compliance Advisor Ombudsman, April 2019
- ↑ Richel V. Umel, "Lanao del Norte environmentalists march almost 100 km vs coal-fired power plant," InterAksyon, July 24, 2015
