Aboitiz Benguet hydro plants back in operation

aboitiz hedcor lower labay hydro

Aboitiz Power Corporation’s three run-of-river hydroelectric power plants in Bakun, Benguet have resumed operations following successful negotiations between subsidiary Hedcor and the Bakun Indigenous Tribes Organization (BITO), together with the town’s local government unit (LGU).

Hedcor’s FLS Hydro, Lon-oy Hydro, and Lower Labay Hydro plants have resumed operations and were synchronized to the Luzon Grid on July 28 after the two-day negotiations.

In a Facebook post by the Mayor’s office of Bakun, it outlined that the Bakun Ancestral Domain, BITO, and Hedcor have “finally settled its disputes through the assistance of the National Commission on Indigenous Peoples – Cordillera Administrative Region (NCIP-CAR), thereby, allowing the three [hydroelectric plants located within the Ancestral Domain of Bakun to resume operations at estimated 8:00 PM [on July 28]”.

Under the terms of the deal, the town’s tribal communities will collectively receive about 14 centavos per kilowatt-hour (kWh) of the generation of the Bakun Plants which is an aggregation of mandatory shares, voluntary benefits, and projects. This includes the Department of Energy’s government shares, Energy Regulations (ER) 1-94 funds, shares and projects outlined in the signed 2019 FPIC-MOA, and the agreed supplemental benefits last July 28.

This comes as the LGU and BITO leaders agreed to combine the benefit shares from Hedcor’s LGU voluntary memorandum of agreement (MOA) proposal and the supplemental benefits to the BITO paved the way for the simultaneous resolution of the LGU concerns and addressing the requests of the indigenous peoples (IP) community.

ER 1-94 states that host local government units should get a share of one centavo per kWh generated by power plants operating in their areas. The rule is a stipulation under Republic Act 9136 or the Electric Power Industry Reform Act (EPIRA).

NCIP-CAR issued a cease and desist order on the three plants back in June due to alleged irregularities in the Free Prior Informed Consent-Memorandum of Agreement (FPIC-MOA) between Hedcor and BITO signed in October 2019.

Hedcor President and COO Rolando Pacquiao expressed his gratitude for the resolution and the continued partnership since 1991 with the community of Bakun for another 25 years.

“We are very grateful that the BITO, LGU and the community have expressed their support over the resumption of our operations in Bakun. We are equally thankful for the support of the NCIP-CAR in opening the doors to dialogue, and to the community for the opportunity to sit down and talk so that we can work on a resolution,” Pacquiao said in a statement.

Hedcor said anticipates the official signing of the supplemental MOA, which will be followed by the conduct of Cañao—a ceremony conducted by IPs in Northern Luzon that signifies thanksgiving and celebration.

With the resumption of operations and the resolution of issues, Hedcor said it looks forward to the completion of its FPIC application and consequently, the release of its Certificate of Precondition by the NCIP.