Buguias to co-own power plant built by Beneco

By Ramon Dacawi

BUGUIAS, Benguet -- Cordillera communities at a loss on how to deal with influential power companies harnessing their water resources for renewable energy generation may well learn to negotiate for benefits offered by the Benguet Electric Coop. to Buguias in its first hydro power generation project.

Topping the benefits accruing to the community, the Buguias municipal government will eventually co-own the three-megawatt (3,000 kilowatts)  Man-asok hydroelectric plant being built at Sebang, Buguias to the tune of P451,143,461.

“Ownership after 25 years – 50 percent owned by Beneco and 50 percent owned by the Buguias Municipal LGU on the 26th year until the life of the mini-hydroelectric plant,” the project fact sheet prepared by project staff Joe Victor Damoslog and noted by PGO manager Ricardo Pallogan.

This provision in the project contract topped benefits to the host community that Beneco general manager Gerardo Verzosa termed as most competitive within the current developer-community tie-up covering hydroelectric power construction and operation.

Aside eventual co-ownership, Buguias will also receive four additional benefits aside from the mandatory benefits provided under Republic Act No. 9513 or Renewable Energy Act of 2008.

“On top of these additional voluntary benefits provided by Beneco is a royalty of P0.2197 per kilowatthour to the host community, an item absent in other contracts for hydro generation being implemented in the Cordillera,” Damoslog said.

The three other additional voluntary benefits are P0.0689 per kilowatt hour going to the municipal government, P02197 oer KWH royalty of indigenous people’s organization, P0.0100 per KWH going to corporate social responsibility and P0.0050 per KWH going to a watershed management fund.

These means a total of P0.3725 per KWH levelized for 25 years which is targeted to generate annually 15,000,000 kilowatt hours.

The mandatory benefits accruing to Buguias are P0.375 percent of the gross receipts as local business tax; one percent of gross income as government share/national wealth tax; 10 percent of assessed value of land as special real property tax on land; 1.5 percent of original cost less depreciation as special tax on equipment; P0.01 per kwh as financial benefit to host communities; P0.30 per square meter per year as special land use (public land) permit or special use agreement in protected areas if within a protected area; and P4 to P4.60 per square meter per month for private land rental.

The project, the first of its kind to be undertaken by BENECO, was turned over last February to PHESCO, the contractor, and is expected to be finished in 2018.

Beneco has tapped Gugler Water Turbines GmbH or Goldsworth, Austria, one of the top suppliers of hydropower turbines, to manufacture and supply the turbine generator set of the facility,” Pallogan said.