Montelago project secures funding from Dutch development bank

Company representatives meet with Congressman Valencia, Montelago, Philippines (source: Constellation Energy Corp.)

Alexander Richter 14 Jan 2014

This morning, news broke that the Montelago geothermal project, a consortium of Constellation Energy Corp. (CED), Emerging Power Resource Holdings Inc. (EPRHI) and IF Technology, has secured funding for its development in Naujan, Oriental Mindoro in the Philippines.

The project, a planned 44 MW power plant with potential additional direct use elements attached, is expected to require an investment of around $170 million, which seems to be – at least partly – to be provided by the Netherlands Development Finance Co (FMO) .

Without providing details, a split of 30 percent of direct equity investment and 70 percent debt financing can be considered for this project and was mentioned earlier.

Expected to be operational by 2016, the plant will be put up along the Naujan Lake in Barangay Montelago, Naujan town.

Antonie de Wilde, EPRHI project chief executive officer, said the project will supply electricity to Mindoro at a rate of P5.64 per kilowatt-hour, which is lower than the cost of diesel and bunker fuel plants.

“We are confident that the addition of geothermal power into the province’s present mix of electricity sources will have a stabilizing effect on the grid,” de Wilde said, as the island faces nearly daily blackouts lasting three to four hours for its residents.

“The geothermal base load is best suited for an island grid’s shift from bunker fuel to renewables, because it is not seasonal and has higher availability. The stability or reliability investors will seek can be provided by geothermal power,” he added.

“The geothermal plant will supply electricity to Oriental Mindoro at a rate of P5.64 per kilowatt hour, a rate that is compliant to the Socially Acceptable Generation Rate (SAGR).”

Source: Interaksyon, Rappler