Kris Vargas | May 30, 2017
Ten years since Magat Hydroelectric Power Plant transitioned from a state-run asset to a privately owned and operated facility under SN Aboitiz Power (SNAP), it continues to be a positive force in the industry and its host communities.
The Magat complex was completed in 1982 and started operating under National Power Corporation in 1983. The government turned over Magat Hydro to SN Aboitiz Power on April 26, 2007, following a successful bid for privatization in December 2006. The non-power components such as the dam remain in government hands.
SNAP won the bid in 2006 with an offer of USD530 million. It underwent project financing, allowing it to provide government full payment only four months into operations and bank negotiations. For this, SNAP-Magat received several project financial citations from international financial magazines. It also secured top-up financing of PHP19 billion to repay its existing loans and finance its recapitalization requirements.
In April, SNAP-Magat celebrated its tenth anniversary on April 26, 2017 in Ramon, Isabela with SN Power SVP and Country Director Tor Stokke, AboitizPower President and COO Antonio Moraza, Department of Energy (DOE) Secretary Alfonso Cusi, Norway Ambassador Erik Forner, and representatives from host local government units.
In his keynote address, Secretary Cusi noted that the country sources 32% of its power from renewable energy, which is the highest in Asia. Though he wants this to continue, Secretary Cusi also stressed that the DOE adopted a “technology-neutral” policy toward power to increase supply and make prices more reasonable.
He also invited the private sector to explore investment opportunities to support Ambisyon Natin 2040, the country’s development vision. “We are open for business,” he said.
Hailing Magat hydro as an example of “a nexus of water, food and electricity,” Secretary Cusi encouraged more sustainable projects that help not just the community but the whole country.
With 360 megawatts (MW) in nameplate capacity and 380 MW in dependable capacity, Magat hydro is one of the largest hydroelectric plants in the country.
“When we took over Magat, it was important to ensure its longevity and to raise its operating efficiency. In 2014, we completed the half-life refurbishment to ensure Magat remains available and operates efficiently through out its life span.”
-Joseph Yu, President and CEO, SNAP
SNAP-Magat is also targeting later this year the completion of the 8.5-MW run-of-river Maris Canal Hydropower Plant Project in Brgy. Ambatali, Ramon, Isabela.
Other than providing clean energy to the grid and customers, Magat is also an accredited provider of ancillary services needed to maintain the reliability and stability of the grid. It is the first private power company to be contracted for ancillary services back in 2009.
Standing on the border of Alfonso Lista, Ifugao and Ramon, Magat Hydro is a proud partner of its host communities. Since 2007, SNAP-Magat has implemented 337 corporate social responsibility (CSR) projects in its host communities, investing a total of PhP220 million for projects in livelihood, education, social infrastructure, health, governance, and environment. Under the Department of Energy’s ER 1-94 program, SNAP-Magat has further remitted PhP73 million from 2007 to 2017. ER 1-94 covers electrification; development and livelihood; and reforestation, watershed management, health and environment projects.
“The first 10 years of our operation provided a lot of resources and benefits to our host communities. As we go into the next ten years and beyond, we are looking at more programmed and sustainable development frameworks to address not only the present generation but also the future generations.”
-Mike Hosillos, Chief Corporate Services Officer, SNAP
“As Magat Hydro enters its 10th year, we will ensure that it continues to provide not just power, but ‘positive power’ — the kind that helps sustain the environment and uplift communities, the industry, and the economy,” Yu added.