This is how Oliver G. Labares describes the country’s first solar power plant.
Labares, who prays for sunlight every day, is the operations and maintenance engineer of the 1-megawatt photovoltaic power plant in this city on the southern island of Mindanao.
When it was inaugurated in 2004, the solar farm was the biggest in the developing world.
It is fully automated and run by computers; besides Labares, an electrical engineer, the only other staff members at the solar farm are a security guard and a janitor.
The solar farm is operated by the Cagayan Electric Power and Light Co., or Cepalco, the fourth-largest private power generator in the country, after Meralco, Visayan Electric Co. in Cebu and Davao Light.
There are only four private power generators on Mindanao: Cepalco, Davao Light, Cotabato Light and Iligan Light.
Cepalco started in 1952 with just 5,000 KW and 750 customers. It now covers over 100,000 customers in Cagayan de Oro City, the 3,000-hectare Phividec Industrial Estate, and Jasaan, Tagoloan and Villanueva towns, all in Misamis Oriental province.
Its on-grid solar photovoltaic power plant operates in tandem with the 7 MW hydropower plant owned by a Cepalco subsidiary, Bubunawan Power Co.
It is really a demonstration solar farm, to show that photovoltaic technology can operate in the Philippines on a big scale.
Cepalco is already sold on the technology and is putting up a 40-hectare, 20 MW photovoltaic plant. Twenty times bigger, it will be built in two phases, each generating 10 MW of power.
The new solar farm will be located in the First Cagayan de Oro Business Park in Villanueva, 30 minutes east of the city. Upon completion in five years, it will generate 14 million kilowatt hours of electricity annually.
This, Cepalco estimates, is equivalent to at least 30,000 barrels of fuel oil a year; the plan is to commission the first phase next year, in time for an expected shortfall of electric capacity in the Mindanao grid.
Awarding of the bid for the first phase has been suspended as the National Renewable Energy Board of the Department of Energy deliberates on what feed-in tariff to charge electric consumers; the tariff is supposed to jump-start the development of renewable energy in the country.
If the tariff is decided later this year, construction of the first phase starts next year and should take about a year. Then the second phase begins in the second half of 2012.
Cepalco it would like to capitalize on the increasing efficiency but decreasing costs of solar panels, which are currently half the installed costs.
When the first solar farm was built in 2004, each solar panel cost about $500; the price has since gone down to about $300.
By 2020, says Labares, there should be grid parity when the cost of solar power generation is competitive with conventional power sources such as oil and diesel. The $5.3 million cost of the plant in 2004 would probably cost $3 million to $4 million today, he says.
This is because of the entry of solar panels from China, which now supplies half of Europe’s solar panel installations, according to Labares. He added that South Korea’s Samsung and LG Electronics are also in the same business.
“It’s like personal computers that were very expensive before but are now affordable,” Labares explains. “With so many players, prices have gone down.”
Cepalco’s solar power expansion, unlike the existing photovoltaic plant, will not depend on a grant but on its own money and loan arrangements.
The existing $5.3-million solar farm was partially funded by the Global Environment Facility of the World Bank through the International Finance Corp.
The turnkey contract was awarded to Sumitomo Corp. Sharp manufactured the solar panels while Sansha made the inverters.
The GEF loan turned into a grant after five years of continuous operations. The solar farm is now in its seventh year, with a contracted maintenance by a Japanese company scheduled this year.
Cepalco is now waiting for the International Finance Corp. to declare the project cost a grant worth $4 million representing 80 percent of the costs. Cepalco’s equity is $1.3 million.
