The Rehabilitation, Operation and Maintenance Agreement (ROMA) concluded in 28 September between MWSS and Angat Hydropower Corporation (AHC) sets out the terms and conditions in the rehabilitation, modernization, and operation of the Auxiliary Turbine Units 4 and 5 (AN 4 and 5). It is an important water security legacy project harmonizing and maximizing the use of the structures shared by the operators of water supply and power supply in Metro Manila, in Angat Dam.
As early as 2011, securing and optimizing Angat Dam and all of its associated structures and assets was one of the MWSS water security legacy strategies to ensure uninterrupted water supply. This includes the Angat Hydroelectric Power Plant (AHEPP) which counts among its appurtenances, the turbines consisting of four (4) main and five (5) auxiliary turbines. The shared facilities include, among others, the penstock, control room, cooling system, overhead crane and switchyard. The AHEPP is now owned by Angat Hydropower Corporation except for AN 4 and 5 which are owned by MWSS.
With a capacity of 10 megawatts, AN-4 was built and put into service in June 1986. With a capacity of 18 MW, AN-5 was built and put into service in January 1993. Due to their age, their major parts were in desperate need of retrofitting or replacement, as well as overhauling. Both AN 4 and 5 were inoperable since 2013.
This brings to light the complexity of having two (2) operators for the AHEPP if MWSS will operate AN 4 & 5 or procure a competent entity to operate them. The attendant process is complicated and fraught with legal and technical issues in light of the privatization of the power assets and shared facilities of the AHEPP.
From an operational perspective, the rationale for the ROMA for AN 4 & 5 are, thus, the following:
- The nature of the operation of the AHEPP necessitates that only one entity should operate the entire facility for a favorable & productive outcome.
- AHC is the owner and operator of the AHEPP which includes the assets and facilities needed and critical for the operation of ATs 4 & 5 and is the sole holder of the water permit to use water from the Angat reservoir for power including water resources to operate AT 4 & 5.
- While ATs 4 &5 remain non-operational, a significant portion of water released from the Angat Dam reservoir to the Ipo Dam for domestic water use is not optimized.
From a larger economy-wide standpoint, the ROMA for AN 4 and 5 has numerous benefits for the country.
- It will provide much need power generation capacity to the Luzon grid, with low incremental costs;
- Availability of additional power on account of renewed capacity would decrease the average power purchase cost of distribution utilities and that of the end consumers.
- More sustainable energy generation mix and lower dependency on carbon fuels such as coal and gas, which the country imports.
- Additional tax generated for the government by the operation of the AHEPP.
MWSS Chairman Reynaldo Velasco said during the contract signing with AHC. . . “I will leave MWSS with the satisfaction of knowing that this legacy project will finally move forward and without cost to the government. Under the ROMA, MWSS will retain ownership of its assets, including its water rights. AHC will operate the facilities on a commercial basis and will be responsible for all capital maintenance. A single operator for the AHEPP will not complicate operations, but will actually ensure continuous water supply.”