Technical, economic, financial, and commercial considerations of the San Miguel Corporation private power program

The Philippines faces a serious power shortage situation. Due primarily to a decision to mothball the 620 MW nuclear power station, the problem is further complicated by a heavy debt burden and a rapidly growing economy, which increased the industrial electric load demand by 12% nationwide, and by 25% in the Metro Manila area during 1988. In response to this crisis, President Aquino signed into law Executive Order 215, legalizing private enterprise participation in the power sector. San Miguel Corporation is one of the largest enterprises in the Philippines with about 23,000 employees and with total sales of US $1 billion in 1988. SMC is presently in its second year of a US $300 million expansion plan to double its present manufacturing capabilities by 1993. To undertake this expansion, in light of the present power shortage, SMC has made a corporate decision to implement a program to secure its own sources of reliable power. The purpose of this study was to evaluate the technical, commercial, and economic aspects of various alternatives for self generation of electricity that are being considered by SMC. (Author abstract)