Naga power station

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Naga power station is an operating power station of at least 221-megawatts (MW) in Colon, Naga, Cebu, Central Visayas, Philippines with multiple units, some of which are not currently operating. It is also known as Naga-3 (Unit 3-1, Unit 3-2), Naga-2 (Unit 2-1, Unit 2-2), KSPC U1 (Unit 2-1), Naga City-1 power station (Unit 1-1, Unit 1-2), KSPC U2 (Unit 2-2), Naga City, Cebu power complex.

Location

Table 1: Project-level location details

Plant name	Location	Coordinates (WGS 84)
Naga power station	Colon, Naga, Cebu, Central Visayas, Philippines	10.21755, 123.76058 (exact)

The map below shows the exact location of the power station.

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Unit-level coordinates (WGS 84):

• Unit 1-1, Unit 1-2, Unit 2-1, Unit 2-2, Unit 3-1, Unit 3-2: 10.21755, 123.76058

Project Details

Table 2: Unit-level details

Unit name	Status	Fuel(s)	Capacity (MW)	Technology	Start year	Retired year
Unit 1-1	retired	coal: lignite	50	subcritical	1981	2015
Unit 1-2	retired	coal: lignite	55	subcritical	1981	2015
Unit 2-1	operating	coal: unknown	110.5	subcritical	2010	–
Unit 2-2	operating	coal: unknown	110.5	subcritical	2011	–
Unit 3-1	cancelled	coal: unknown	100	subcritical	–	–
Unit 3-2	cancelled	coal: unknown	100	subcritical	–	–

Table 3: Unit-level ownership and operator details

Unit name	Owner	Parent
Unit 1-1	Therma Power Visayas Inc [100%]	Aboitiz Power Corp [100.0%]
Unit 1-2	Therma Power Visayas Inc [100%]	Aboitiz Power Corp [100.0%]
Unit 2-1	SPC Power Corp [100%]	SPC Power Corp [100.0%]
Unit 2-2	SPC Power Corp [100%]	SPC Power Corp [100.0%]
Unit 3-1	Therma Power Visayas Inc [100%]	Aboitiz Power Corp [100.0%]
Unit 3-2	Therma Power Visayas Inc [100%]	Aboitiz Power Corp [100.0%]

Background on Naga-1 and Naga-2

Naga power station originally comprised five power plant units: the 43.8-megawatt (MW) Cebu Diesel Power Plant, the Naga-1 power plant (Unit 1 - 50 MW, Unit 2 - 55MW), the Naga-2 power plant (Unit 1 - 103 MW, Unit 2 - 103 MW), and the 55 MW Land-Based Gas Turbine Plants 1 & 2. CTPP1 and CTPP2, which burn coal, are also referred to as Naga-1 and Naga-2.

The two-unit, 105-MW coal-fired Naga-1 power station was completed in 1981-86. The plant was originally owned by SPC Power Corp., a subsidiary of Salcon Power (60%) and Korea Electric Power Company (KEPCO) (40%); it was privatized and sold to this consortium in October 2014, in what has been called a "windfall" deal for the plant's new owners. The additional two-unit, 206-MW coal-fired Naga-2 plant was completed in 2010-11 by Salcon and KEPCO. The Naga-1 power station was retired in 2015 as part of the Naga-3 expansion plans (see below).

As of April 2023, the DOE list of existing power plants showed that the capacities of the two units of the Naga-2 plant were 110.5 MW each.

Proposed Naga-3 expansion

In July 2014, Salcon Power announced plans to build a new two-unit, 200-MW coal-fired Naga-3 coal plant, and to scrap the original Naga-1 plant rather than pursue a previously-awarded government contract to refurbish it. The mayor of Naga City, who had protested the planned rehabilitation of Naga-1, welcomed the decision to close it and build new units instead. The feasibility study was begun in September 2014. The mayor of Naga said in November 2014 that construction would likely not begin until late 2015. The Naga-3 coal plant has also been described as 300 MW (2 x 150 MW) in size.

As part of the expansion plan, demolition of the Naga-1 plant was slated to begin in July of 2015. However, it is unclear how far demolition progressed before ownership of the facility was transferred to Aboitiz in 2018. In the December 2015 Philippines Department of Energy list of operating power plants in the Visayas region, the Naga-1 generators are listed as having 0 MW of capacity. In the December 2016 list, Naga-1 has been removed altogether.

As of December 2016 there was no news as to whether construction began on the new units, and plans appeared to be tied up over ongoing disputes over the ownership of the Naga-1 plant.

In July 2017, Aboitiz, the parent company of Therma Power Visayas Incorporated (TPVI), announced that it would "upgrade the facility and put up a more efficient power plant" but did not say if this would include an increase in capacity. Aboitiz is waiting for the Power Sector Assets and Liabilities Management Corp. (PSALM) to officially turn ownership of the facility over to TPVI.

As of November 2018 there had been no further news about the expansion and it appears to have been cancelled. No expansion plans are included in the Philippines Department of Energy's December 2020 reports.

Ownership

In April 2016, the purchase of the facility by SPC Power was challenged in court, and the Supreme Court upheld its nullification of the sale, indicating that Therma Power Visayas would become the owner of the plant. The Supreme Court reaffirmed this ruling in February 2017. In May 2018 Therma Visayas was awarded ownership of the facility and took ownership in July 2018. The transfer only applied to the retired Naga-1 generator units and one diesel-fired facility. The two Naga-2 units are still owned and operated by Kepco SPC.

In June 2021, KEPCO had to find 24 different insurers to cover $556 million USD for the operation of the Naga power station. 11 of these insurers did not insure any other KEPCO project, and one did not even have the typically expected A-credit rating.

In October 2022, KEPCO was allegedly trying to sell off its coal and gas assets. They had lost the company an unprecedented $12 billion USD in the first six months of the year.

In January 2023, KEPCO had reportedly entered the "the second round of the sale process for its interest in a coal-fired power plant in Cebu and stake in local firm SPC Power Corp." According to the company, "the move aimed to strengthen its commitment to carbon neutrality and its plan for a complete coal phase-out by 2050."

Labor Union Action and Vote to Strike

In March 2023, labor union members at the Naga power station collectively voted "yes" to carrying out a strike to demand that the management "respect the law and recognize KCEA-WSN [Kepco Cebu Employees Association-Workers Solidarity Network] as the sole collective bargaining agent and agree to renegotiate their Collective Bargaining Agreement." The notice of strike was reportedly filed in January 2023 "for alleged union busting and refusal to renegotiate the worker’s CBA." A news article later reported that the strike process had been halted, after the secretary of the Department of Labor and Employment (DOLE) entered the mediation process. Regarding the mediation process, union federation officer Dennis Derige urged the power plant's management "to follow the law and recognize them [KCEA-WSN] as the official union organization of the company," which the management had apparently not yet acknowledged at the time.

Financing

Phase 2: In 2010, the project raised debt of $270 million against project cost of $490 million, with the Asian Development Bank and the Export-Import Bank of Korea (Kexim) each providing direct loans of $100 million and commercial lenders together supplying $70 million. Sumitomo Mitsui Banking Corp led the syndicate of three commercial banks, which also included ING and Calyon. The three banks each provided an equal share of the commercial tranche, which benefited from comprehensive political and commercial risk cover from Kexim.

Articles and Resources

Additional data

To access additional data, including an interactive map of coal-fired power stations, a downloadable dataset, and summary data, please visit the Global Coal Plant Tracker on the Global Energy Monitor website.