Ambuklao-Binga

completed

_x000C_The Ambuklao and Binga hydroelectric power plants are being privatized as a package through an international tender process, as part of the privatization program under a comprehensive sector reform law, the Electric Power Industry Reform Act (EPIRA). At privatization, expected to occur in June 2008, the plants will be owned by SN Aboitiz Power Benguet, Inc. (SNAPB), a joint-venture between SN Power Invest (SN Power) of Norway and Aboitiz Equity Venture (AEV) of the Philippines. IFC’s proposed investment, a loan, will be in parallel with additional financing from Nordic Investment Bank (NIB) and local banks and will support the privatization.The proposed IFC investment will partly finance the privatization and rehabilitation of the 75 MW Ambuklao hydroelectric power plant and the 100 MW Binga hydroelectric power plant, currently owned by National Power Corporation (NPC). The rehabilitation will re-commission the Ambuklao plant, which has been shut down due to silt problems, upgrade the Binga plant, and increase the combined capacity by 50 MW in total (30 MW for Ambuklao and 20 MW for Binga) from 175 MW to 225 MW. They will operate as peaking plants, supplying power to the Luzon grid for about five hours daily. There are no electric transmission system constraints with regard to the expected higher generation levels.The project company, SNAPB, is expected to take over the hydropower facilities in June 2008, and will put in place new management procedures, address technical issues such as sedimentation and dam safety and implement the rehabilitation of both plants. SNAPB will also enter into a separate agreement with the Government, for those facilities that will remain under public ownership, to cover the operation and maintenance of the dams and appurtenant structures, formulation of operations manuals, formation of an oversight committee, and maintaining the integrity of the water levels in the reservoirs. Responsibility for the watershed management will remain with the Government.