GEOTHERMAL POWER PLANT

Chapter I: Introduction
NAME AND ADDRESS OF THE COMPANY

Tiwi Geothermal Power Plant

Tiwi Albay, Bicol Philippines

Political Region: V

BRIEF HISTORY

Between 1964 and 1968, the Commission on Volcanology initiated exploration of the Tiwi
geothermal field. Geologic mapping and geological surveys were undertaken and
temperature gradient holes were drilled during that period.

In early 1971, upon the invitation of the Philippine Government, Union Oil Company of
California (Unocal) formed Philippine Geothermal, Inc. (PGI) to explore for and develop
geothermal resources. Through a service contract entered into with the state-owned National
Power Corporation (NPC) on September 10, 1971, PGI provided the technical expertise and a
portion of the funding for exploration and subsequent development of the Tiwi geothermal
area. NPC, for its part, was responsible for building and operating the power plants.
 Even before the energy crisis of the early seventies, the Philippine government already
initiated efforts to develop the country’s indigenous energy resources. The general intent was
to lessen the country’s dependence on imported fossil fuels. In 1967, recognizing the
potential and benefits of geothermal development, the Philippine Congress enacted Republic
Act No. 5092, otherwise known as the Geothermal Law. RA No. 5092 stipulates that natural
gases and geothermal energy resources belong to the State and enabled the government to
set aside or reserve lands as geothermal reservations. Thereafter, Presidential Decree (PD)
739 was issued on August 1, 1970 that established 17,661 hectares in Albay Province to
constitute the Tiwi geothermal reservation.

GEOGRAPHIC LOCATION

The Tiwi field has an installed capacity of 275 MWe and is located about 300-km
southeast of Manila in the Albay Province. Exploration began in 1964, and power was first
generated in 1979. By 1982 Tiwi became the world’s first water-dominated geothermal
system to produce more than 160 MWe. Philippine Geothermal, Inc. (PGI) operates the steam
field and the National Power Corporation (NPC) constructed and operates the power plants.

The Tiwi geothermal field is located on the northeast flank of Mt. Malinao, an extinct
Quaternary stratovolcano in the East Philippine Volcanic Arc. This arc is a belt of upper –
Miocene to Recent calc-alkaline volcanoes associated with subduction along the Philippine
Trench. Mt. Malinao is composed dominantly of <0.5 million year-old andesitic lavas and
lesser pyroclastic rocks.
LOCATION MAP

OWNERSHIP AND CAPITALIZATION

Government of the Republic of Philippines/National Power Corporation：NPC

Outline of Yen loan:

Approved loan amount/ Disbursement. 7,056 mil yen / 6,408 mil yen
Exchange of notes/ Signing of loan November 1994 / December 1994
Agreement. Interest rate: 3.0%, repayment period: 30
Loan interest years (including
grace period of 10 years),
general untied loan
Disbursement completion January 2006
Project Agreement Marubeni (Japan)
( worth of 1 billion yen or more)
Consultant Agreement West Japan Engineering Consultant (West
( worth of 1 million yen or more ) JEC)・Philippines Geothermal, Inc.
（PGI）
Feasibility study (F/S) etc. 1992 Completion of F/S by Japan
Consulting Institute
1992 Completion of JICA master plan
（Study on Luzon Grid P/P facility
repair/maintenance & control
improvement plan）
Relevance
It was confirmed that the implementation of the project is consistent with the
development needs and policy, both at appraisal and ex-post evaluation. Therefore,
relevance of the project implementation is high.

Consistency with government policy and measures

Appraisal

“Mid-term Philippine Development Plan (1987-1992)” at around the project appraisal

(January 1993) period says that it is important to strengthen infrastructures because it is
the base of sustainable social economic development. In particular, improvement of
reliability and efficiency of power supply was prioritized in power sector. The plan
listed utilization of indigenous energy such as geothermal energy, and rehabilitation,
improvement and repair of existing facilities as specific measures to be implemented.

“Mid-term Philippine Development Plan (1993-1998)” continuously emphasized the use

of indegenous energy and encouraged diversification of energy sources for stable supply
at low cost. Geothermal power generation was focused as one of the solutions.
The Philippines has continuously implemented a measure to strengthen the use of
indigenous energy resources since 1970s. The country emphasized the need to expand
power generation capacity based on domestic resources for stable and sufficient power
supply at lower cost. In response to severe shortage of electricity since the second half
of 1980s, the country positioned geothermal energy as the most promising domestic
energy resource to lower the dependency on imported energy resources in “Philippine
Energy Plan：PEP 1992-2000”.

In response to the serious lack of electricity mentioned above, the country enacted BOT
law in 1990 and Electric Power Crisis Act in 1993 to promote private participation in
power generation sector.

Consistency of the project with government policy mentioned in “Mid-term Philippine

Development Plan” and “Philippine Energy Plan” above is confirmable because the
project emphasizes the importance of utilizing geothermal energy at appraisal. The
project was implemented after the country introduced a policy to promote private
investment, but this is because the government decided both public and private capitals
were necessary to overcome the power crisis. From this perspective, the project is
deemed to be consistent with the government’s development policy.
Evaluation phase

Similarly, “Mid-term Philippine Development Plan (2004-2010)” at around the time of

evaluation (2008) focused on securing stable and sufficient power supply and promoted
the use of domestically produced energy as government policy, while encouraging the
reform of power sector led by private corporations. “Philippine Energy Plan (PEP)
2005-2014” upholds effective use of indigenous energy as a sector target, and specifically
emphasized the utilization of reproductive energy including geothermal energy.
Securing power supply and effective use of domestic energy were emphasized in
“Mid-term Development Plan” and “Philippines Energy Plan” continuously at evaluation
phases, which underpin the project’s consistency with measures/policy.

Consistency with development needs

Power shortage persisted in the Philippines since the second half of 1980’s and peaked
by power crisis in 1992-1993, during which power-cut that lasts 5 hours or longer
occurred frequently. Development of power supply source, recovery of output and
improvement of obsolete power generation facilities were needed for stable power supply.
The project was requested by the country as an emergency measure to counter the power
crisis by rehabilitating power generation facilities. Accordingly, needs of the project is
deemed to have been quite high at appraisal phase.
However, thanks to an active introduction of Independent Power Producer： IPP
centering foreign capital, power shortage was resolved by 1994. As shown in Figure-1,
power generation facility always had additional capacity of 3,000MW or more beyond the
demand, since economic crisis in Asia and at appraisal in 2008. Nevertheless, Power
Supply and Demand Outlook (2006-2014) compiled by the Department of Energy: DOE,
estimates that power shortage will occur again around 2010, and therefore, strengthening
of power generation facility is necessary. Since the target of the project is to promote an
effective use of geothermal energy for balanced use of resources and stable power supply,
there was a need for the project in times of evaluation, too

Aboitiz Power Corporation History

The Aboitiz Group’s involvement in the power sector goes all the way back to around
1918 when documents show the Aboitiz family owned around a 20% equity stake in the
Visayan Electric Company (VECO), which was started by a group of Cebu-based
businessmen in 1905.

In 1930, Aboitiz patriarch Ramon Aboitiz purchased from the Borromeo family the
Ormoc Electric Light Company, the first utility the Aboitiz Group actually owned and
managed. It was also in the 1930s when the Group partnered with Francisco Such for Jolo
Power Company. In 1935, Cotabato Light and Power Company was acquired, followed by
Davao Light and Power Company in 1946.
 In 1978, the Ormoc and Jolo utilities were divested and converted into electric
cooperatives. That same year, the Hydro Electric Development Corporation (Hedcor), was
organized to venture into the hydroelectric power generation business. By 1990, Hedcor
had a portfolio of 14 plants and 36 MW of installed capacity. In 1996, the 70-MW Bakun
hydro plant was commissioned by Luzon Hydro Corporation, an Aboitiz joint venture with
Pacific Hydro Pty Ltd of Australia.

AboitizPower was incorporated in 1998 to hold the Group’s investments in the power
sector. The company initially held only power generation assets but in early 2007, holdings
in the distribution utilities Davao Light, Cotabato Light, Subic EnerZone, San Fernando
Electric and VECO were transferred to AboitizPower. Later that same year, ownership in
Balamban EnerZone and Mactan EnerZone were added into the company.

In December 2006, SN Aboitiz Power-Magat, the joint venture between AboitizPower

and SN Power of Norway, bid for and subsequently awarded the 360-MW Magat hydro
plant in Northern Luzon.

AboitizPower had an eventful year in 2007. In July, it became publicly listed at the
Philippine Stock Exchange. In August, together with Vivant Energy Corporation of the
Garcia Group, partnered with Global Business Power Corporation of the Metrobank Group
to form Cebu Energy Development Corporation (CEDC) for the construction and operation
of a 246-MW coal-fired plant in Cebu island. This plant is due for commissioning in the first
quarter of 2010. In November, AboitizPower closed the agreement for the purchase of a
34% stake in STEAG Power, which owns and operates a 232-MW coal-fired plant in
Mindanao island. In December, SN Aboitiz Power-Benguet, the joint venture between
AboitizPower and SN Power of Norway, won the bid for and awarded the Ambuklao-Binga
hydropower complex consisting of the 100-MW Binga and 75-MW Ambuklao power plants.

In July 2008, AboitizPower, through wholly owned subsidiary Aboitiz Power

Renewables, Inc., (APRI) won the bid for and awarded the Tiwi-Makban geothermal
facilities. Tiwi-Makan consists of several power stations located in the provinces of
Quezon, Laguna, Batangas and Albay in Luzon island. The Tiwi-Makban geothermal
plants recorded a combined peak generation of 467 MW in 2009.

In October 2009, AboitizPower, through wholly owned Therma Luzon, Inc. (TLI), bid
for and was awarded an Independent Power Producer-Administrator (IPPA) contract for
the output of the 700-MW coal-fired Pagbilao power plant in Quezon province.

In February and March 2010, AboitizPower through its subsidiary, Therma Mobile,
assumed ownership and operations of PB118 (renamed Mobile 1) and PB117 (renamed
Mobile 2), after acquiring the two power barges from PSALM for U.S.$30 million through a
negotiated bid concluded last July 31, 2009. Each of the barge-mounted, diesel-powered
generation plants has a generating capacity of 100 MW. PB 117 and PB 118 are moored in
Nasipit, Agusan del Norte and Barangay San Roque, Maco, Compostela Valley, respectively.
 Within the same month of March, 2 greenfield projects became operational. The first
of two units of the Sibulan Hydro power plant, operated by Hedcor Sibulan Inc, started its
commercial operations with 26 MW. The second unit, or 16.5 MW is expected to
commence commercial operations within second quarter of 2010. Meanwhile, unit 1 of the
coal-fired power plant of CEDC with 82 MW was also commissioned in March, while the
second and third units by the second and fourth quarter of 2010, respectively.
Structural organization for operation and maintenance

Environment surrounding power sector in the Philippines had dramatically changed

from the time of the project appraisal to today. The impact is making changes to the
operation and maintenance of the power plant. More specifically, Electric Power
Industry Reform Act：EPIRA was enacted and entered into force in June 2001, and
because of this, decision was made to split NPC, an implementing organization of the
project, into a power generation company and a power transmission company, and
privatize each (power generation asset is to be sold).
In response to the reorganization of power sector, bidding of both Tiwi and Mak-ban
power plants took place at the end of July 2008, to sell their asset and privatize the two
power plants together. AP Renewables (a company newly established to operate
Tiwi/Mak-ban power plants), wholly owned subsidiary of Aboitiz Power Corporation
（APC）successfully won the bidding.
As of December 2008, operation and maintenance of the power plants were
continuously undertaken by Tiwi Geothermal Power Plant Office under NPC, as
pre-sellout transitional arrangement. Currently, 167 employees of NPC (2 supervisors,
65 operators, 63 maintenance staffs, 19 administration and finance division staffs and 18
engineers) are working at Tiwi Geothermal Power Plant (see Figure-5).
Handover of the power plant to AP Renewables is planned to take place around May
2009, and operation, maintenance, control and management of the power plants will also
be completely transferred from NPC to AP Renewables by then.

Impact to the environment

At first, acquisition of Environment Compliance Certificate：
ECC was considered not necessary for the project, because it is a rehabilitation project to
recover the function, not involving establishment of a new plant. However, ECC was actually
issued in September 2002, and based on that, NPC has been implementing environmental
monitoring during and after the project implementation.
The result was compiled by NPC every quarter. Environment Control Bureau, local
government, power plants, Steam Supply Service Company and NGOs also have started joint
monitoring activities.
At the project, equipment to dilute hydrogen sulfide gas was installed to mitigate the
impact of the gas emission, as a measure to improve environmental condition.
According to the monitoring results, the project satisfies the standard of the country, and
so far, no specific problem has been pointed out in compiled reports. Temporary
dwellings are sparsely located in areas around the power plant No serious problem was
reported after visiting and hearing from some residents.

Impact to social environment, land acquisition and relocation of residents

The project does not involve land acquisition or resettlement because it is a
rehabilitation project of existing facilities. According to the provision on tax payment to
the local government, 0.01 pesos are taxed per the sale of 1kWh electricity. The project
contributed to increase earnings from electricity sales and tax revenue for the local
government, resulting in improvement to the standard of living and introduction of social
welfare programs for residents in the area.
Chapter II: Design Consideration
PURPOSE OF THE PROJECT

Enhance the efficiency and reliability of the power generation facilities by

repair/replacement of the existing facilities of Tiwi Geothermal Power Plant in the
Philippines, effectively use indigenous energy, and ultimately improve the balance of
demand and supply of power at Luzon Grid.

Demand of power in the Philippines is converted in Luzon Grid by about 75%, however,
construction or addition of a new power generation facility didn’t take place until the second
half of 1980s. Due to the deterioration of facilities, power generation function was seriously
deteriorated and chronic power-cut persisted due to the lack of electricity until the first half
of 1990s.the basic idea of the 3 energy policies upheld by the government of the Philippines
were “reliable power supply at reasonable price”, “promotion of efficient energy use” and
“development of energy with minimum environmental impact”. Based on the basic idea, the
country targeted to reduce dependency on imported oil from 51.4% in 1986 to 46.9% in 1992
and strengthen geothermal power generation.
The Philippines has the second most abundant geothermal energy In the world after the
U.S in production and utilization of geothermal energy.

GENERAL CONSIDERATION

Geothermal power plants use relatively small acreages, and don't require storage,
transportation, or combustion of fuels. Either no emissions or just steam are visible. These
qualities reduce the overall visual impact of power plants in scenic regions.

Geothermal technologies offer many environmental advantages over conventional power

generation:

 Emissions are low. Only excess steam is emitted by geothermal flash plants. No air
emissions or liquids are discharged by binary geothermal plants, which are projected to
become the dominant technology in the near future.
 Salts and dissolved minerals contained in geothermal fluids are usually reinjected with
excess water back into the reservoir at a depth well below groundwater aquifers. This
recycles the geothermal water and replenishes the reservoir. This system will prolong the
life of the reservoir as it recycles the treated wastewater.
 Some geothermal plants do produce some solid materials, or sludges, that require
disposal in approved sites. Some of these solids are now being extracted for sale (zinc, silica,
and sulfur, for example), making the resource even more valuable and environmentally
friendly.
Several attributes make it a good source of energy.

 First, it's clean. Energy can be extracted without burning a fossil fuel such as coal, gas, or
oil. Geothermal fields produce only about one-sixth of the carbon dioxide that a relatively
clean natural-gas-fueled power plant produces, and very little if any, of the nitrous oxide or
sulfur-bearing gases. Binary plants, which are closed cycle operations, release essentially no
emissions.
 Geothermal energy is available 24 hours a day, 365 days a year. Geothermal power
plants have average availabilities of 90% or higher, compared to about 75% for coal plants.
 Geothermal power is homegrown, reducing our dependence on foreign oil.

SCHEMATIC DIAGRAM OF GEOTHERMAL POWERPLANT

Simplified flow diagram for single flash geothermal power plant

Simplified flow diagram for double flash geothermal power plant

 Simplified flow diagram for binary geothermal power plant

Simplified flow diagram for direct steam geothermal power plant

DESIGN AUXILIARY

PUMP

The operating characteristics of deep well pumping equipment in a geothermal well power-
generation system are observed by cooperating sensor and communication elements
permanently associated with the geothermal well equipment itself. Bridge circuit sensors
detect well water temperature and water pressure below and above the pump, while a
further sensor detects pump rotational speed. The data is transmitted by a multiplexing
acoustic communication link coupled to receiver and display means located at the earth's
surface. An electrical generator driven at the pump speed serves as the rotational speed pick
off and additionally supplies multiplexing and signal processor power for use at the down-well
site. The signal processor includes novel diode circuits in each bridge sensor channel for
monitoring the operation of the individual sensors and their common power source, thereby
providing a surface display of the parameter being measured by a particular sensor channel
and additionally providing a calibrating display of the operating status of that channel.
GEOTHERMAL TURBINE

A geothermal turbine for converting the energy of two-phase geothermal fluids to

rotary power includes a housing having a generally cylindrical rotor chamber with a circular
manifold, and a plurality of peripheral nozzles for communicating fluid to the rotor chamber,
and a rotor mounted coaxially within the chamber incuding a plurality of converging
overlapping blades mounted around a central hub and positioned within the rotor for
engagement by fluid from the nozzles.

The planning specifications for the 110MW turbine are as follows:

Type: Tandem compound, four-flow condensing turbine

Rated output: 1 10,OOOkW
Speed: 3,600 rpm
Main steam pressure: 7.04 kg/cm2g
Main steam temperature: 179.4 C
Gas contents: 0.1 - 2.2% (weight percentage)
Exhaust pressure: 102mmHg abs.
Governor: Mechanical hydraulic
Main stop valve: 34 inches (bore) x 2
By-pass valve: 10 inches (bore) x 1 (for main steam stop valve)
Control valve: 24 inches (bore) x 4
COOLING TOWER

A cooling tower is a heat rejection device, which extracts waste heat to the atmosphere
though the cooling of a water stream to a lower temperature. Common applications for
cooling towers are providing cooled water for air-conditioning, manufacturing and electric
power generation. The generic term "cooling tower" is used to describe both direct (open
circuit) and indirect (closed circuit) heat rejection equipment. A direct, or open-circuit cooling
tower is an enclosed structure with internal means to distribute the warm water fed to it over
a labyrinth-like packing or "fill." The fill may consist of multiple, mainly vertical, wetted
surfaces upon which a thin film of water spreads. An indirect, or closed circuit cooling tower
involves no direct contact of the air and the fluid, usually water or a glycol mixture, being
cooled. In a counter-flow cooling tower air travels upward through the fill or tube bundles,
opposite to the downward motion of the water. In a cross-flow cooling tower air moves
horizontally through the fill as the water moves downward. Cooling towers are also
characterized by the means by which air is moved. Because evaporation consists of pure
water, the concentration of dissolved minerals and other solids in circulating water will tend
to increase unless some means of dissolved-solids control, such as blow-down, is provided.
Some water is also lost by droplets being carried out with the exhaust air (drift).
MIST ELIMINATOR

Special devices developed in1947 to remove mist from gas streams. Now known as mist
eliminators, these devices provide a large surface area in a small volume to collect liquid
without substantially impeding gas flow. Unlike filters, which hold particles indefinitely, mist
eliminators coalesce (merge) fine droplets and allow the liquid to drain away. Gas typically flows
upward through a horizontal mist eliminator.

More recently, advances in technology have enabled substantial progress in mist eliminator
designs, materials, and application expertise. New products and methods of use have been
found highly effective for many purposes, especially the following:

• Increasing throughput
• Downsizing new vessels
• Improving product purity
• Cutting operating costs
• Reducing environmental pollution
• Reducing downstream corrosion
• Increasing recovery of valuable liquids
MOISTURE SEPARATOR

Moisture separators are used to remove as much moisture from the steam as possible
before it goes to the turbine. In boiling water reactors (BWR) the steam going to the turbines is
close to saturated conditions. In pressurized water reactors (PWR) the steam going to the low-
pressure turbines also passes through moisture separators. If moisture in the form of water
droplets enters the turbine it causes erosion damage to the turbine blades.
The condensate that accumulates in the moisture separators is drained off to be used in
feedwater heaters or forwarded to the condenser. The temperature and pressure of the
condensate are at saturation conditions, and a decrease in pressure will cause it to flash to
steam. Flashing often occurs in the drain valves where the pressure in the next stage of the
process is lower. The volume of the steam is much greater than the volume of condensate per
pound mass, therefore, to pass the same flow rate through a pipe the velocity of the steam is
much higher. When flashing occurs inside a control valve it usually begins just after the final
pressure drop stage. Here the condensate is in a transitional state between liquid and vapor.
Since the vapor moves through the downstream portion of the valve faster than the liquid, the
water droplets are accelerated to high velocity. When these droplets strike the valve body or
downstream piping they can cause erosion. The high velocities of the vapor can also be a source
of noise and vibration, leading to valve damage.
Flowserve Anchor/Darling Valves with MSMP (Multi Stage Multi Path)

MSMP trim channels the flow through a series of orifices to reduce the pressure in stages.
This prevents the condensate from cavitating inside the valve and dissipates most of the energy
before the last stage. Flashing is only allowed across the last stage. The velocity of the fluid is
kept low to prevent erosion of the valve body.
FE trim works well for applications requiring one or two
stages of pressure reduction. Each stage consists of many
small holes drilled into cylinders. The condensate pressure is
reduced by directing the flow through the small holes.
Flashing occurs across the last stage and velocities are kept
low to prevent erosion of the valve body. Both styles of trim,
FE and MSMP, reduce noise and vibration.

Wellhead Control Valves

Wellhead Control Valves are designed for safe and

convenient pump-in, pump-out, and retrieval of downhole
hydraulic “free” pumps.

As part of your hydraulic pumping system, the Weatherford Oilmaster Wellhead Control
Valve is designed to provide your installation that extra measure of convenience and safety.
Located at the wellhead, this component controls the flow direction of the high-pressure fluid
that powers the downhole pump. Shift the lever and the power fluid flows down the tubing to
run-in the “free” pump and operate it. To pump-out and retrieve, another shift of the lever
directs the flow down through the annulus and up the tubing, lifting the pump to the surface.
Once at the surface, a built-in bypass circuit lets you exchange the pump without shutting down
your power source. This feature helps prevent fluid shocks when reversing flow direction, too.

Features and Benefits

 Extended Catcher Nipple - this allows bleeding of pressure and gas out of tubing before
removing the pump.
 Swivel Block Design - 60° rotation gives maximum flexibility in aligning control assembly
with connecting lines during hookup.
 Large Fluid Passages - inlets and outlets allow high volume flow rates. Welded or threaded
ends in several sizes are available.
 Pressure Relief Valve -protects well tubulars against excessive pressure build-up during
pump-out cycle. Opens at 1,500 psi and resets automatically when pressure is relieved.
 Choice of Inlet Connections - flanged inlet nipple for casing “free” installations. Slip joint
connection with adjustable offset for parallel string installation.
 Pump Catcher for Easy Retrieval - to change out, shift the lever and the downhole “free”
pump will flow to surface where the indicator announces pump arrival. Unit latches in the
catcher unattended, without pressure build-up.
 4-Way Lever Control - swift and easy actuation. Valve has three positions: pump-in and
operate, bypass and pump-out.
 Pressure Gauge - with pulsation dampener, shows the circulating pressure and pump
strokes. Lets your pumper know just what is happening downhole.
 Low Maintenance Valve - rugged design with few wearing parts. Replaceable elements
include stainless steel sleeve and seat and metal-sprayed spool.
 Power Fluid Bypass -stops high-pressure accumulation at welllhead during pump removal.
Controls the pressure setting when quick changes of flow direction are needed to unseat the
downhole pump. Gives shock-free reversal of fluid flow direction
Down Hole Pumps

A down hole pump is a tool used in the well which admits fluid from the producing CBM
well into the tubing and lifts that fluid to the surface. A down hole pump is used in conjuction
with the pump jack and its rod string. The entire process of lifting fluid by means of a down hole
pump works as a straw in a glass of water.

Downhole submersible pumps are a key component for large scale power generation from
geothermal resources. Both Hydrothermal and Enhanced Geothermal Systems require a robust
serviceable pump capable of bringing heat to the surface. Both literature review and interviews
with geothermal experts confirmed the importance of such a pump in advancing the
development of the technology.

Specification:

Pump Type: Maximum Discharge Flow: Maximum Discharge Pressure:

 Centrifugal Pumps  Less than 0.012 GPM  Less than 15 psi

 Drum Pumps  0.012 to 0.55 GPM  15 to 46 psi

 Diaphragm Pumps  0.55 to 12 GPM  46 to 145 psi

 Double Diaphragm  12 to 120 GPM  145 to 1,263 psi

Pumps

 Dosing Pumps  120 GPM and up  1,263 psi and up

BRINE BOOSTER PUMP

Specification:

Maximum Discharge Flow: Maximum Discharge Pressure: Horsepower:

 Less than 0.76 GPM  Less than 165 psi  Less than 0.78 HP

 0.76 to 3 GPM  165 to 1,356 psi  0.78 to 1 HP

 3 to 12 GPM  1,356 to 3,550 psi  1 to 2 HP

 12 to 120 GPM  3,550 to 9,700 psi  2 to 5 HP

 120 GPM and up  9,700 psi and up  5 HP and up

STEAM JET INJECTOR

Steam jet ejectors are often used to pull vacuum on surface condensers, evaporators, etc. A
high pressure, motive, fluid (usually steam) enters the ejector chest through a nozzle and then
expands. This converts its pressure energy to velocity. The increased velocity causes reduced
pressure, which sucks in and entrains gas from the suction. The diffuser section then
recompresses the mixed steam/gas stream to some intermediate pressure. The exhaust is then
sent to a condenser which quickly condenses the steam at a low pressure and temperature so
that the volume quickly decreases.

Specification:

Ultimate Operating Vacuum: Pumping Speed / Venturi Jet Type / Media:

Displacement:
 Less than 52 torr  Less than 0.77 CFM  Venturi Air Jet

 52 to 161 torr  0.77 to 2 CFM  Liquid Eductor / Ejector

 161 to 338 torr  2 to 4 CFM

 338 to 696 torr  4 to 14 CFM

 696 torr and up  14 CFM and up

STEAM CYCLONE SEPARATOR

A cyclone type separator is used to clean the geothermal steam that is extracted from a
geothermal reservoir beneath the earth by removing brine, condensed fluids, dirt, and some
other particulates that are harmful to the turbine blades of a power plant.

Specification:

Applications: Airflow: Minimum Particle Size Filtered:

 Abrasives  Less than 700 SCFM  No more than 0.26 µm

 Coolant / Oil Mist  700 to 1,646 SCFM  No more than 0.6 µm

 Explosive Media  1,646 to 4,275 SCFM  No more than 4 µm

 Fine Powders  4,275 to 13,390 SCFM  No more than 46 µm

 General Cleaning  13,390 SCFM and up :

 MAINTENANCE NEEDS AND PRACTICES IN GEOTHERMAL POWER PLANTS

The processes that give rise to geothermal waters take place naturally deep beneath the
surface of the earth and involve water-rock interactions at high pressures and elevated
temperatures. The resultant fluids contain varying concentrations of dissolved and suspended
rock-based elements such as silica, chlorides, carbonates and sulfur compounds among others
in varying quantities. The fluids reach the surface equipment with varying quantities of these
elements and quantities of gases depending on the geothermal field. The presence of these
elements in geothermal fluids present major challenges in the maintenance of equipment in
geothermal power plants (GPPs). The suspended solids which include silica, chlorides and
rock cuttings are transported in the hot water and can settle at the bottom of equipment and
can cause blockage on the hot water equipment and drains. The dissolved solids like silica,
chlorides and sulfur precipitate when the saturation conditions are reached and cause scaling
on the walls of equipment. The scaling causes blockages, sealing and impedes normal
functioning of equipment. Dissolved and mixed gases which include hydrogen sulfide (H2S),
oxygen and carbondioxide (CO2) can make the solution acidic which can cause accelerated
corrosion in the presence of heat, water and oxygen.

To understand and determine maintenance needs of GPPs, a failure mode and effect
analysis (FMEA) was performed. All the potential failures for each equipment in the plant were
established together with the all the possible causes each potential failures. All the possible
consequences are determined and the maintenance actions needed to prevent the potential
failure or mitigate after failure has occured can be determined by analysing the failure mode.

A detailed FMEA for a GPP is presented in Appendix 1. A summary of potential failures and
corrective and preventive maintenance needs for GPPs are given in Table 8.

The maintenance practices in GPPs vary from vary from one field to another depending on
the nature of field, the plant design and the inherent practices. Each plant has its own method
of doing maintenance based on experience and unique problems in the plant in addition to
recommendations by manufacturers of equipment. Visits and interviews were contacted in
selected GPPs in Iceland, in addition to experience from Olkaria GPPs in Kenya. An
overview of maintenance practices in these power plants in relation to properties of the
geothermal fluids is discussed.

EVALUATION MAINTENANCE FOR A GEOTHERMAL POWER PLANT

Main equipment in of a typical GPP

 A typical GPP has hundreds of operating equipment that have to be maintained to
preserve their functionality, maintain plant safety and improve plant efficiency. A generalized
flow diagram for a typical electricity producing GPP is shown in Figure 14 below. Only major
processes and equipment are shown. A complete assembly of a GPP consist of thousands of
components that make it a complex.

A SIMPLIFIED PROCESS FLOW DIAGRAM FOR A

GEOTHERMAL POWER PLANT

In a typical electricity producing GPP, the main processes are steam gathering and
transmission, turbine and its auxiliaries, generator and electrical, Gas extraction, cooling
processes and instrumentation and controls. A summary of the main components in the
processes is shown in Table 8. Only the major components under each system are presented.

Equipment in a typical an electricity producing GPP

 System/process Main Equipment Main Components

Production and Wellhead Master valves, flow control

transmission valve, two-phase
pipeline
Separator station Separator vessel, pressure
relief device, level control
Steam transmission Steam pipe, condensate
drains, steam pressure,
controllers, steam driers,
steam flow meters
Water transmission Hot water pipeline, hot
water pressure relieve
Turbine and Inlet devices Steam strainer, emergency
auxiliaries valves, governor valves
Steam Turbine Rotor, nozzles, diaphragms,
bearings, casing, gland
seals
Oil system Oil pumps, servomotors, oil
tanks, oil pipes
Cooling system Cooling towers Fans, motors, gear reducers,
structure, fills, cold
water ponds, strainers
Water pumps Large hot well pumps and
motors, auxiliary pumps
Condenser Condenser heat exchangers,
nozzles, gas cooling
Gas Extraction Steam jet ejector Control valves, isolating
System valves, nozzles,
intercoolers
Vacuum pump Vacuum pump, water seal,
motor
Generator and Generator Rotor, stator, exciter,
Electrical bearings, cooler
Transformers Step up transformers, station
transformers
Protection Relays, switchgears,

Failure mode and effect analysis (FMEA) for GPPs

Failure modes define the ways that failure of equipment occurs and the circumstance
associated with the failure. The causes of failure refer to the likely originators of the failure
while the effects of failure define what happens if and when failure occurs. The effects of
failure include functional, the safety, operational and the economic consequences. The effects
of the potential failure affect the maintenance approach to be adopted for the particular
equipment whether to prevent the failure from happening or correct the failure after it
happens. In doing a FMEA for GPP, the main equipment was grouped into steam gathering
and transmission, Turbine and accessories, Cooling and the non-condensable gas extraction
system, the generator and electrical system and Instrumentation, control and protection. The
FMEA analysis for each of the systems in a GEOTHERMAL POWER PLANT

FMEA for the steam gathering and transmission equipment

The main equipment in the steam gathering and transmission system consist of different
types and sizes of valves which include master valves, service valves, drain valves and control
valves; pipelines which include two phase pipelines, hot water and steam pipelines; separators
that include steam separators, mist separators and condensate drains; silencers and hot water
disposal system.

Valves Separator
Lost Disk, Leakage Wrong quality, Rupture

Scaling Blocked drains

Corrosion Scaling Effects
Poor Wrong design  Wasted Resources
Material  Cost of Downtime
 Cost of Repair
 Safety and
Wrong Environment
Scaling Specification  Wet Steam
Deformation Malfunction  Loss of well
Corrosion Bursting

Pipelines Pressure devices

Burst, Leakage deformation Wrong operation

Cause effect diagram for a geothermal steam gathering system

FMEA for turbine and auxiliaries

The turbine equipment consists of the turbine rotor and rotor bearings, the casing and
diaphragms and the steam glands. The auxiliaries include steam control valves, emergency
steam valves and the steam strainers. The turbine rotor is one of the most expensive
equipment in GPPs and requires well designed maintenance processes to minimize the risk of
failures. A summary of FMEA for a turbine system is illustrated in Figure below where the
possible failures are given at the roots, the possible causes as links and the effects at the head
of the diagram.

Turbine Inlet valves

Worm blades, Vibrations Sticking, leaking, hunting

Wet steam Worm glands

Corrosion Scaling

Poor alignment Worm valve seats Blocked

Scaling strainer Effects
 Vibration of rotor
 Reduced efficiency
 Loss of control
Scaling Broken
 Safety
impeller
 Cost to repair
Wet steam Blocked draings
Corrosion Poor operation
Casing Oil pumps
Blocked blades Inadequate flow
Loss of interstage seals Low pressure

Cause effect diagram for a geothermal turbine and main accessories

FMEA for the Cooling and NCG extraction system

The cooling system in a GPP is consists of the cooling towers made up of cooling fans and
cooling tower structures, hot well pumps and pipes and the steam condenser. The NCG
extraction system consists of the gas cooling section in the condenser, the steam jet ejectors
and vacuum pumps and the inter-condensers. A summary of the FMEA for the system is
summarized in Figure below.
 Cooling tower Condenser

Scaling on tubes
Corrosion on tube
Fouling
of fills Fan blade failure

Effects
 Poor cooling
 Loss of vacuum
Blockage Wear Bearing  Loss of efficiency
of nozzles failure

Water seal Scaling Vibration

break

Vacuum pump Ejectors Hotewell pumps

Cause effect diagram for geothermal cooling ad gas extraction systems

FMEA for the generator and electrical system

The generator consists of the generator rotor and stator, rotor bearings, generator air
coolers and the excitation system. The equipment grouped as electrical system consisting of
power cables, switchgear, transformers, motors and relays and several electrical gadgets. Figure
above is an illustration of the failure cause effect diagram for the generator and electrical
system which shows what can fail, the causes and what happens when the failures occur.
 Generator rotor Generator stator
Vibration, rubbing Heating, arcing

Misalignment Poor cooling

Loosened wedges Corona effects

Poor lubrication
of bearings Effects
 Downtime cost
 Safety concern
Misaligned  Cost to repair

Clogged air fins

Wrong operation Dirty tubes

Excitation Stator coolers

Under-voltage, vibration No flow, leakage

Cause effect diagram for the generator and electrical systems

FMCEA for instrumentation, control and protection system

The instrumentation, control and protection are very important parts of a GPP. The
instrumentation covers a wide variety of instruments installed in the GPP. The type of
instruments depends on the level of technology in the design of the plant but they all serve the
purpose of monitoring and communicating the performance of the GPP. The instruments
include pressure gauges, temperature gauges, vacuum meters, flow meters etc. The control
function is important to ensure the GPP operates within the required limits. Control system
receive measured parameter signal and use the value of the signal to generate a control signal
to keep the performance within what is desired. One common control system in GPPs is the
supervisory control and data acquisition (SCADA) system. The protection systems include all
the systems installed to ensure the plant components are protected. They include the
protection relays for the generator, transformers and the turbine protection. Because of the
sensitivity of these systems, their sound operation is critical. A FMEA for the system is
presented in Figure below.

SCADA
Working signal, No signal DCS

Damage No power
cables

Poor calibration H2S damage

Effects
 Safety risk
 Inefficiency
Wrong calibration H2S damage  Downtime

H2S damage Wrong instrument

Relays Instruments

Cause effect diagram for instrumentation and control system

Summary of maintenance needs for a GPP

From the findings of the FMEA for each component, the maintenance actions needed to
prevent or correct the failures are deduced. The mode of execution of the maintenance needs
will depend on the maintenance approach applied and will be guided by the management
method applied. Corrective maintenance actions will be required to correct equipment failure
that has occurred. In some cases, it is effective to perform a failure preventive maintenance
instead of corrective maintenance. The preventive maintenance actions are guided by
measured indicators of potential failure or based on interval period derived from experience
or vendor recommendations. From the FMEA, it is seen that most of the potential failures in
GPPs are linked to the chemical and physical properties of the geothermal fluids. The effects
of failures range from safety to performance loss. The nature of potential failures affect the
type of maintenance procedures adopted whether to prevent or respond to the failures. A
summary of preventive and corrective maintenance needs for each failure modes in a GPP are
shown.
 Summary of preventive and Corrective maintenance needs of a
GEOTHERMAL POWER PLANT
Failure mode Preventive actions Corrective actions

Steam gathering Review operation of valves Replace glands

Sticking valves Redesign maintenance Overhaul
Replace
Leaking glands schedule
Blocked pipes Inhibit scaling agents like
Worn valve discs silica
Failed traps Redesign of steam traps
Dislodged pipes Check pipe designs

Turbine accessories Review operating pressures Detect and identify

Scaling on rotor and and flow the problem
diaphragms blades Check the steam drying Address the cause
Wear and corrosion processes Repair the failed part
Sticking of valves Check the turbine alignment Redesign the system
Rotor vibration Investigate and correct
bearing lubrication
Regular Stem free test of
valves
Cooling & NCG Improve quality of cooling Detect and identify
Fouling of condenser water by treatment and adding the problem
tubes fresh water Address the cause
Blocking of nozzles Improve steam processing Repair the failed part
Fouled cooling tower Chemical dosing of cooling Redesign the system
fins tower
Scaling of ejector Check operating pressures for
Vacuum pump water steam ejectors and vacuum
seal breaking pumps
Generator Electrical Ensure turbine-generator Detect and identify
Rotor vibration exciter the problem
Loose stator coils alignment Address the cause
Arcing of switch Eliminate causes of corona Repair the failed part
gears effects Redesign the system
Failure of motors Maintain correct switchgear
Failure of operations and contacts
transformers Monitor all motors
performance
Regular test transformer oil,
contacts and temperatures
Instruments, protection Use non copper materials Replace damaged
& controls Isolate copper parts from H2S copper parts
H2S damage of eg air conditioning Calibrate equipment
copper Install backup safety Repair or replace
Wrong control signal Install backup control circuits damaged parts
Failure of protective
relay
The common maintenance problems related to the physical and chemical properties of the
geothermal fluids in geothermal power plants include the following:
 Silica scaling on steam pipes, valves, separators and turbine nozzles
 H2S attacks on exposed copper material of switchgears, transformers, motors etc
 Extensive surface corrosion of ferrous metals of pipes, pipe supports, structural
frames
 Blockage of drains due to deposits of suspended solids and silica in the fluids
 Sticking of valves as a result of scaling cement
 Leaking of valves due to worn valve discs
 Failure of steam traps and condensate drain devices
 Bursting of pressure safety discs due to pressure fluctuations
 ME524
(Tiwi Geothermal Power Plant)

Mark Anthony De Sosa

Mark Joseph Nonan
Percival Soliman
Jake Villanueva
Anthony Melo

Contact no.09204055245
 CHAPTER III -ENGINEERING REPORT

Power shortage persisted in the Philippines since the second half of 1980’s and peaked by power
crisis in 1992-1993, during which power-cut that lasts 5 hours or longer occurred frequently.
Development of power supply source, recovery of output and improvement of obsolete power
generation facilities were needed for stable power supply. The project was requested by the country as
an emergency measure to counter the power crisis by rehabilitating power generation facilities.
Accordingly, needs of the project is deemed to have been quite high at appraisal phase.

However, thanks to an active introduction of Independent Power ProducerIPP centering foreign

capital, power shortage was resolved by 1994. As shown in Figure-1, power generation facility always
had additional capacity of 3,000MW or more beyond the demand, since economic crisis in Asia and at
appraisal in 2008. Nevertheless, Power Supply and Demand Outlook (2006-2014) compiled by the
Department of Energy: DOE, estimates that power shortage will occur again around 2010, and therefore,
strengthening of power generation facility is necessary. Since the target of the project is to promote an
effective use of geothermal energy for balanced use of resources and stable power supply, there was a
need for the project in times of evaluation, too.
 Act
ual and trend of peak power demand at Luzon Grid, capacity of power generation facility and power
generation capacity

Output

Outline of Tiwi Geothermal Power Plant

Plant Power Start of Rated output

generator operation
Plant A Unit 1 January 1979 55MW
Unit 2 May 1979 55MW
Plant B Unit 3 January 1980 55MW
Unit 4 April 1980 55MW
Plant C Unit 5 December 1981 55MW
Unit 6 March 1982 55MW
Total 330MW
NoteCompiled by Tiwi Geothermal Power Plant materials.

However, according to the study on power generation capacity of Tiwi Geothermal Reservoir and
the scope of the development (January 1990), electric energy possibly produced by heat reserve there
was estimated to be 250MW x 25 years. This can be concluded as an overestimate since the volume of
steam was short of even fully operating 4 units at a time of evaluation (2008) as detailed hereinafter,
after delayed start of the operation. Further, capacity factor was set at 70% then. Based on the above, it
is estimated difficult to achieve 85% availability factor of geothermal power generation facility plan set
in Japan then. Facility repair/improvement plan should have been made based on the volume of steam.

After all, the project plan was reviewed in 2001 due to substantial delay in the project start as
detailed hereinafter, and it has led to find out the decrease of steam flow. In response to this, power
generation facility for repair/improvement was reduced from 6 units to 4 units, which can be evaluated
for making operation of the power plant more sustainable by reflecting the actual situation.

As a conclusion, despite overestimation at the appraisal of the project planning, the scope was
adjusted to fit the reality for implementation; therefore, the project is highly relevant with “Mid-term
Philippine Development Plan”, “Philippines Energy Plan” and development needs at times of both
appraisal and evaluation.

Efficiency ( Rating)

Project implementation was delayed substantially (261%) and project cost was slightly larger than
planned (137% for one facility); therefore, the evaluation for efficiency is low.

Output :

Power generation facilities

 As aforementioned, the project was planned to repair/improve all the 6 units at appraisal but
actually, partial repair was done to 4 units (1, 2, 5 and 6). This scale back of the repair scope was mainly
due to the continuous reduction of steam flow from geothermal well year after year that resulted in
limited steam supply. Repair to the 4 units was a partial one focused on recovering function of power
plant and safety operation.

Summary of changes to project

Contents Process/Reason of
Planning/Changes

Plant at Appraisal Replacement, repair installation etc. of Reviewed necessary scope of

( Jan. 1993) turbine, power generator, gas extract repair/improvement aimed at
device and cooling tower units 1 – 6 recovering reliability and
(55 MW each) effectiveness of units 1 – 6 .

Output at the first contract Limit repair to the recovery of function With reduced steam flow, it was
(Related to the scope change and stable operation of 4 units (unit 1, decided that there is no sufficient
Agreed by former JBIC; 2, 5, and 6). After repair, units 1 and 2 source of power for 2 units,
May 2001) are strengthen to 60MW while units 5 therefore, only 4 units were
and 6 to 57MW. subject to repair. In addition the
Implementation Scope originally planned but excluded government of the Philippines
Period: due to duplication of scope with NPC shifted from “full repair” to
Jun.2003 – Feb.2004 project; repair replacement of honing “partial repair” based on their
machine, control board recorders, own review result, which
indicators, converters and controllers concluded partial rehabilitation
for turbine repair/replacement of air was sufficient to recover the
 conditioning system, replacement of function. According to technical
turbine supervisory instrumentation, examination by yen loan division
purchase of equipment for calibration, of former JBIC (current JICA), the
partial replacement of disconnecting change is reasonable because
switches for switchyard, repair/check of recovery of function is possible if
main cooling water pipeline, rehabilitation planned by NPC is
procurement of cooling tower materials properly implement. Former JBIC
and environment monitoring requested the government not to
equipment. make further reduction to the
scope.

Output at additional Added the scope of repair for 4 units NPC, a contractor and a
Contract (Related to the second (unit 1, 2, 5, and 6), because it is consultant jointly carried out a
scope change considered necessary for stable study in Dec.2001 and May 2002,
Agreed by former JBIC; operation. There were 27 newly added and confirmed stable operation is
Feb.2004) repair/improvement items difficult, contrary to the
(facilities/parts) in total including expectation. Also, additional
Implementation period; replacement of cooling tower for unit 5 repairs turned out to be
Jun.2004 – Dec. 2005 and 6 and purchase of switch gear and necessary to satisfy conditions of
motor for gas extract equipment for unit steam supply contract. The
2 government of the Philippines
decided to exchange additional
contract, to which former JBIC
agreed because the addition was
originally included as part of the
scope and deemed necessary at
appraisal and therefore,
necessary to achieve the target of
the project.

Note: compiled based on JICA materials.

After changes to the scope explained above, actual output was reduced by 2 units from the
original plan because repair of 2 units were excluded from the project. If technical analysis of the
situation had been thoroughly conducted at the first scope change, the second change was less likely
required.

Project period

The project term was originally set at 51 months after the exchange of yen loan agreement, but it
actually took 133 months until repair/improvement was completed and operation of 4 units got started
(December 2005), much longer than planned (11 years and 1 month: 261% of the plan). 92 months (7
years and 8 months) have passed after the exchange of loan agreement until receiving approval from
the government of Philippines (contract coming into effect), and 41 months (3 years and 5 months) from
the contract entry to the completion of the project. Reasons for the delay are as explained below.

Reasons for the delay before contract becoming effective, after yen loan agreement
 Lawsuit over Steam Supply Service Agreement

Steam Supply Service Company filed a lawsuit at a court of arbitration against NPC that owns
Tiwi/Mak-ban Geothermal Power Plants 1 , complaining NPC rejected renewal of steam supply contract
(25 years of contract. Expiration in 1996). NPC also brought the case to a domestic court. Steam Supply
Service Company offered to drop charges on condition that Tiwi/Mak-ban Geothermal Power Plants was
transferred to them and repair cost was burdened by them in exchange. In this situation, the
government of Philippines decided to suspended implementation of the project because they needed
time to review many things including whether or not to implement the project, at all. Considering the
fact that negotiation of the project contract was completed in April 1999, the project could have been
completed 3 years or more earlier if the government had not decided the suspension.

Privatization of power plant

As breakup and privatization of power sector was being promoted in the Philippines, the
government spent considerable time reviewing which was more efficient to sell/privatize Tiwi
Geothermal Power Plant via yen loan (repair/improvement by direct control of NPC) or privatization
(repair/improvement by private company after purchase of the power plant). (Procedure for the project
was interrupted 2 until September 2000 (69 months or 5 years and 9 months after the exchange of yen
loan agreement), due to the lawsuit and the review of privatization) Facing such circumstances, NPC and
former JBIC regularly discussed to advance procurement procedure.

Review for the scope change

While discussions over the aforementioned lawsuit and privatization delayed the project
implementation, deterioration of power plant progressed and additional repair/improvement became
necessary according to the degree of deterioration. It took additional time to review the scope change
and to receive approval for that. The government of Philippines approved the scope change and
exchanged the project contract in July 2002 (contract became effective).

Development from contract entering into force until the project completion

After the contract became effective, original scope of the project was once fixed in February 2004.
However, field study conducted by NPC, the consultant and the contractor concluded that an
additional repair was deemed necessary for stable operation of the power plant. Further, additional
repair/improvement became necessary to achieve a certain level of power generation capacity and
reliability under conditions of Geothermal Resource Sales ContractGRSC 3 . In response to this,
additional contract was concluded in June 2004 and the repair work was completed in December
2005.

Status and effectiveness of operating power plant

 In the original plan, repair/improvement of 6 units was expected to achieve 70% of capacity
factor and volume of gross power generation at 2,024GWh/year. However, actual volume of power
generation is barely half of the target, 1,172GWh (2006) and 890GWh (2007).

Operation status/initial plan (for all 6 units)

Indicator (unit) Base Target Actual Actual
(1992) (2006) (2007)
Total gross electricity generation (GWh) 1,998.5 2,024 1,171.6 890.07
Total net electricity Generation (GWh) 1,877.4 1,888 1,081.0 825.8
Total rated output (MW) 330 330 344 344
Dependable capacity (MW) 284.6 231 153.3 112.6
Unit average of capacity factor (%) 68.9 70 38.2 29.2
Average availability factor (%) 81.7 - 56.2 43.9
Total operation time (hour) 43,085 - 29,564 23,073
Total forced outage (hour) 261.4 - 399.8 957.2
Total interruption time due to external 683 - 11,037 13,190
factors (hour)
Source : Appraisal materials for base and target of capacity factor, calculated based on capacity factor and station
userate for other targets. NPC for actual.

Operation status/initial plan (for 4 units subject to repair/improvement)

Indicator (unit) Base Target Actual Actual
(1992) (2006) (2007)
Totalgross electricity generation (GWh) 1,371.3 1,349 1,171.6 890.07
Total net electricity generation (GWh) 1,289.9 1,259 1,081.0 825.8
Total rated output (MW) 220 220 234 234
Dependable capacity (MW) 199.7 154 153.3 112.6
Unit average of capacity factor (%) 71.0 70 57.3 43.8
Average availability factor (%) 79.3 - 84.4 65.8
Total operation time (hour) 27,853 - 29,564 23,073
Total forced outage (hour) 193.3 - 399.8 957.2
Total interruption time due to external 487 - 2,277 4,430
Factors (hour)
SourceAppraisal materials for base and target of capacity factor, calculated based on capacity factor and station use
rate for other targets. NPC for actual.

In comparison, rated output of units 1, 2, 5 and 6 increased by 14MW from appraisal (1992)
to after the project completion (2006), but actual output was decreased by 40-50% on average
per unit. Main reasons for this are as follows:

 Capacity factor is low and power generation capacity is maintained low. Main reason for this
is difficulty in securing sufficient steam volume to operate the 4 units. Steam volume is
decreasing by 8-10% a year.
 Typhoon struck an area close to the power plant in November 2006, causing temporary
shortage of output by the damage (however, based on utilization status of repaired facilities
during out-of-typhoon season (before November 2006), output after the project completion
is smaller than that during project planning, due to the lack of steam volume).

Trend of generation

Source : NPC
Note: Red star and yellow star show the timing of appraisal and completion of the project,
respectively. Repaired/improved units are 1, 2, 5 and 6. Uptick in output in 2004 was due
to temporary operation of units after the first improvement and before the start of
additional contract (operation was suspended due to repair work in 2005).

Trend of plant load (capacity factor) and availability factor of

facilities (rehabilitated 4 units)
 Main contribution to the decline in output is dwindling steam volume and substantial delay
in the project implementation. By the time of the project completion, steam flow was simply not
sufficient to fully operate the rehabilitated facilities.

On the other hand, deterioration of facilities became obvious since the second half of
1990’s, on top of accident caused suspension and dwindling steam flow. Plant load (capacity)
factor and availability factor of facilities got as low as 20% for each, as shown in Figure-2 and 3.
If the project had not been implemented, the rate could have reached almost zero in 2004 and
thereafter. In consideration of this, the project has produced effects of increasing output in 2004
and in 2006 and thereafter, despite reduced steam volume.

Recalculation of Financial Internal Rate of Return FIRR

Increased from 9.2% at planning (appraisal) to 16.8% at evaluation. EIRR (Economic Internal
Rate of Return) is difficult to be calculated and analyzed by comparison for evaluation, due to
restriction on calculation measures applied for appraisal.
Increase in FIRR was mainly due to (i) increase of fuel cost and maintenance cost by 60%,
increase of wholesale power cost to 2 times or more in contrast, and no increase in initial
investment because the project scope was narrowed from 6 to 4 units, (ii) substantial delay in the
project implementation worsened deterioration of facilities, which extremely widened the
difference in outputs between With (with the project) and Without (without the project), for actual
value than planned one (at planning, FIRR was based on assumption that capacity factor remains at
63% for Without, but in fact it plummeted to 20% by 2001. FIRR turns negative if the capacity factor
remained at 63% for Without), (iii) regardless of substantial delay in starting procurement of
materials/equipment and repair work, there was no cost incurred in the meantime, and (iv) repair
work was completed as planned and succeeded in temporarily starting operation in 1.5 years of the
first contract.

Assumptions of IRR
 At planning At evaluation
FIRR cost Investment cost, fuel cost and operation Same as on the left.
maintenance cost (for rehabilitated (Apply unit cost as of Nov. 2008 for
portion) fuel and maintenance costs in 2008
and thereafter)

FIRR benefit Income from electricity sales (increase Same as on the left.
after repair/ improvement) Applied actual output after project
Output was calculated based on implementation until 2007.
capacity factor of 63% for actual, 70% Applied actual figures for 2008,
for post rehabilitation and 63% for capacity factor of units 1 and 2 was
Without. put at 63% (operate 6 months each
Assumed 2 units will be closed in 2011 in turn) and units 5 and 6 at 75%
and another 2 in 2012. (full operation), and assumed
reduction of output by 8% every
year due to dwindling steam volume
for 2009 and thereafter.
For Without, applied actual until
2002 and assumed output got lower
than the actual output of the
preceding year by 8% since 2003.
Assumed units 1 and 2 will be closed
by 2015 for both With and Without.

Project life 19 years (15 years after rehabilitation) 15 years after rehabilitation

Impact
Contribution to the stabilization of Luzon Grid, diversification of energy sources and use of
domestic energy

Impact to the environment

 Trend of Luzon Grid generation by power source

Compared to the planning stage, output of Tiwi Geothermal Power Plant has decreased as a
whole as shown in Table-3 above. Positive impact of the output increase to Luzon Grid as a whole
could not be confirmed. Generation share of the power plant to the whole Luzon Grid was 2.8%
in 2006 and 2.0% in 2007, which is lower than 10.6% in 1992 when the project was planned.
However, if the project had not been implemented, Tiwi Geothermal Power Plant is considered
to have almost lost the power generating capacity. The project aimed at promoting an effective
use of geothermal energy, which is highly valued as a renewable domestic energy. Since rated
output of Tiwi Geothermal Power Plant makes up 30% of the total geothermal power generation
at the Luzon Grid (based on rated output), the percentage of geothermal energy to the whole
energy produced at the Luzon Grid could have been dramatically reduced without the project.

Economic impact

Geothermal power is an indigenous energy and had positive economic impact to lower fuel cost.
Generation of 1kWh of electricity costs 6 times more in case of oil-fired power generation and 1.7
times more for gas-fired power generation in comparison to the cost of steam needed for
geothermal power generation. The project was effective in cutting back fuel cost equivalent to
324 mil pesos (in case of gas-fired power generation) - 2.256 billion pesos (in case of oil-fired
power generation).

Impact to the environment

At first, acquisition of Environment

Compliance CertificateECC was considered
not necessary for the project, because it is a implementation. The result was compiled by
rehabilitation project to recover the function, NPC every quarter. Environment Control
not involving establishment of a new plant. Bureau, local government, power plants,
However, ECC was actually issued in Steam Supply Service Company and NGOs
September 2002, and based on that, NPC has also have started joint monitoring
been implementing environmental
monitoring during and after the project

activities.
Environment around the power plant

At the project, equipment to dilute hydrogen sulfide gas was installed to mitigate the impact
of the gas emission, as a measure to improve environmental condition. According to the monitoring
results, the project satisfies the standard of the country, and so far, no specific problem has been
pointed out in compiled reports. Temporary dwellings are sparsely located in areas around the
power plant as shown in Picture above. No serious problem was reported after visiting and hearing
from some residents.

Impact to social environment, land acquisition and relocation of residents

The project does not involve land acquisition or resettlement because it is a rehabilitation project
of existing facilities. According to the provision on tax payment to the local government, 0.01 pesos are
taxed per the sale of 1kWh electricity. The project contributed to increase earnings from electricity sales
and tax revenue for the local government, resulting in improvement to the standard of living and
introduction of social welfare programs for residents in the area.

Sustainability
 Due to observed concern over the shortage in steam volume and the impact to the sustainability
of the project, sustainability of this project is fair.

Implementing organization

Structural organization for operation and maintenance

Environment surrounding power sector in the Philippines had dramatically changed from the
time of the project appraisal to today. The impact is making changes to the operation and
maintenance of the power plant. More specifically, Electric Power Industry Reform ActEPIRA was
enacted and entered into force in June 2001, and because of this, decision was made to split NPC,
an implementing organization of the project, into a power generation company and a power
transmission company, and privatize each (power generation asset is to be sold).
In response to the reorganization of power sector, bidding of both Tiwi and Mak-ban power
plants took place at the end of July 2008, to sell their asset and privatize the two power plants
together. AP Renewables (a company newly established to operate Tiwi/Mak-ban power plants),
wholly owned subsidiary of Aboitiz Power Corporation APCsuccessfully won the bidding.
As of December 2008, operation and maintenance of the power plants were continuously
undertaken by Tiwi Geothermal Power Plant Office under NPC, as pre-sellout transitional
arrangement. Currently, 167 employees of NPC (2 supervisors, 65 operators, 63 maintenance
staffs, 19 administration and finance division staffs and 18 engineers) are working at Tiwi
Geothermal Power Plant (see Figure-5). Handover of the power plant to AP Renewables is planned
to take place around May 2009, and operation, maintenance, control and management of the
power plants will also be completely transferred from NPC to AP Renewables by then.

Technology for operation and maintenance

The power plant has accumulated experiences through 30 years of operation, and operation
and maintenance are done based on their own knowhow and technology, without technical
assistance from external parties.
According to the operation and maintenance plan of AP Renewables submitted in times of
the bidding, the company basically maintains the current employees of Tiwi Geothermal Power
Plant for the time being. Also abundant experiences of its parent company Aboitiz Power
Corporation are expected to be reflected to the operation and maintenance of the power plant,
accumulated by undertaking numerous projects of hydraulic power generation and power
transmission projects in the country.
As stated above, there is no structural or technical problem with the current NPC structure.
AP Renewables also has abundant power generation project experiences and since they intend to
maintain the current employees of NPC, there is no specific concern in terms of
technology/structure as of December 2008, in transitional phase.