CEBU, Philippines – The Freedom from Debt Coalition (FDC), in partnership with several environmental lawyers here, expressed in the strongest possible terms its opposition to the impending approval by Asian Development Bank (ADB) on the Kepco Salcon Power Corp. (KSPC) loan of $120 million for the construction of its 200MW coal-fired power plant in Naga, Cebu.

FDC-Cebu calls on the ADB to reject the Kepco Salcon Power Corp. loan and urges the Department of Environment and Natural Resources (DENR) to intervene and ensure the environmental protection of Cebuanos. It further calls on the Department of Energy (DOE) to move away from its bias on coal and seriously implement the country's renewable energy law.

The project is a joint venture of Kepco Philippines Holdings and Salcon Power Corporation called the Visayas Base Load Power Project involving the construction and operation of a 200MW coal-fired power plant to provide additional base load power to the Visayas grid.

The project comes at a time when there is a strong push towards renewable energy in the country  and the ADB's recent adoption of its 2009 Energy Policy that ostensibly will “help Asia and Pacific countries secure adequate energy supplies while cutting levels of greenhouse gas emissions.”  

FDC Cebu believes this impending ADB approval validates the financial institution's horrible track record in funding the private sector’s past and ongoing projects that contributes to climate change.

The power industry is a major contributor to climate change with power plants utilizing fossil fuels such as coal contributing the highest amount of CO2 emissions to the atmosphere.

The project is categorized under Category A, projects that have significant adverse environment impacts that require submission to the lending institution an environmental impact assessment (EIA).   

However, KSPC's EIA and Initial Poverty and Social Assessment (IPSA) submitted to ADB glossed over health and environmental risks posed by the coal-fired power plants. No information was provided  on any baseline data of studies undertaken. The mitigation plan does not include a health program to monitor coal ash-related diseases plus any mention on the impact on coastal communities and marine ecosystems.

Instead, KEPCO entered into a Memorandum of Agreement with the Cebu Province on July 3 to dump coal ash in a P100M 25-hectare property recently purchased by the province that is partly submerged in seawater. This deal is currently questioned by environmental lawyers under the Global Legal Action on Climate Change (GLACC) for conflict of interest and violation of existing environmental laws.

The province expects to earn $1 for each ton of coal ash dump, a token amount compared to the overall degradation to be suffered by communities living near the power plants and the coal ash dump site area. -30-

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