MANILA - Aboitiz Power Corp. has signed an agreement to supply renewable energy to San Fernando Electric Light and Power Co. (SFELAPCO) for 3 years starting Dec. 26, 2009.

SFELAPCO president Michael Escaler said the firm would initially get 40% of its 80-megawatt total demand from Aboitiz Power starting January 2010, and increase this to 100% by October.

SFELAPCO is currently sourcing bulk of its power from the National Power Corp., and around 10% from the Wholesale Electricity Spot Market.

The recently forged supply agreement will result in savings of 40 centavos per kilowatt hour for 80,000 customers of SFELAPCO since renewable energy is value-added tax-free, according to Escaler.

"We believe that as a distribution utility, it is our primary duty to serve our customers well and at the same time to treat our environment well. By going green, we achieve both goals simultaneously," he said.

SFELAPCO's franchise area covers barangays in San Fernando City and in the municipalities of Floridablanca, Bacolor, Guagua, Lubao and Santo Tomas.

Jose Lazatin, SFELAPCO senior vice president and general manager, said the supply contract is good until Sept. 12, 2012.

Aboitiz Power will use Cleanergy, its brand of clean and renewable energy, as vehicle for this agreement. The power that would be supplied to SFELAPCO will come from Aboitiz Power's 802-MW Tiwi-Makban geothermal facility, as well as from its Hedcor-Irisan hydroelectric plant in Benguet.