The Lopez Achievement Awards (LAA) cycle 2014 celebrated the feats of an even dozen winners on October 15, 2015. It was the 13th straight year for the Lopez Group to recognize the best performing teams in six categories.
First Balfour met the critical challenge posed by its client and delivered a 115-kilovolt overhead transmission line (OHTL) and a substation ahead of schedule. Both were essential for the on-time commissioning of Energy Development Corporation’s (EDC) Burgos Wind Project (BWP).
First Balfour finished the OHTL two months earlier than what the leading competitor said it would take to finish a project of such scale and complexity. It involved the engineering, detailed design, procurement, construction and installation of steel poles and 128 steel towers on a 42-kilometer trail passing through Burgos, Pasuquin, Bacarra and Laoag in Ilocos Norte. The team turned over the project seven days ahead of schedule.
The same team was tapped to take over the substation project, which was behind schedule by almost four months. Originally awarded to a foreign contractor, the Burgos Substation and Interconnection Works contract, First Balfour delivered the project, enabling EDC to commission the BWP nine days ahead of schedule.
ABS-CBN subsidiary ABS-CBN Convergence Inc. launched the iWant TV app on ABS-CBNmobile and empowered subscribers to watch ABS-CBN programs anytime and anywhere they want. The company capitalized on the development of nonlinear TV viewing, where the emphasis is on mobility, convenience and choice instead of following scheduled TV channel programming.
ABS-CBN Convergence created a new habit of watching video content on mobile using the ABS-CBNmobile SIM; using the mobile-friendly iWant TV app, subscribers shifted their behavior from watching on desktop to watching on mobile, thereby increasing the average revenue-per-user of the ABSCBNmobile subscriber base.
EDC won two business management awards: one for securing the feed-in-tariff (FiT) for its BWP ahead of competitors; and another for the first documented successful transfer of a geothermal power plant in the Philippines.
For its 150-megawatt (MW) BWP, EDC managed completion delay risks to qualify for the best scenario of receiving guaranteed revenues at the P8.53 per kilowatt-hour FiT rate for the next 20 years. Working with strategic partners to mitigate risks, the company completed construction in 17 months with over 4.5 million safe man-hours and zero losttime incidents by contractors.
After accepting the challenge of expanding the project to 150 MW from an original 87 MW, EDC had to work through regulatory, contractor performance and technical challenges to achieve successful commissioning by November 5, 2014. With a total cost of $450 million, the BWP became the biggest investment supporting the Philippine renewable energy program.
Meanwhile, another EDC team was working on the transfer of the Northern Negros Geothermal Power Plant (NNGP) from Northern Negros to Nasulo in Southern Negros. The NNGP was shut down in 2011 due to insufficient steam to operate the plant. The decision to relocate a nonperforming asset that was written off and caused EDC its first and only net loss thus far entailed a series of financial and technical evaluations that challenged the N2N Relocation Project team.
A total of 2,000 tons of equipment was transferred over a total distance of 242 kilometers, using 193 trips over land, 13th LAA cycle yields 12 winners 17 trips over sea, and crossing 16 cities and municipalities and 49 bridges in two provinces. The team withstood 23 landslides, 30 heavy rain incidents and had as many as 1,159 workers on-site at the peak of work. In addition to the physical transfer of NNGP assets and their almost Humpty Dumpty-like reassembly into a working geothermal power plant, the team had to construct additional pipelines, drill a new well and install underground cables to connect to the transmission lines.
The results directly impacted EDC’s financial results for 2014, with the newly put-together 49-MW Nasulo Power Plant contributing generation of 208 gigawatt-hours and incremental revenue of P481M to the Southern Negros group. Impairment charges of P2.3 billion on the previously non-operating asset were reversed, improving EDC’s financial condition for the year.
EDC also garnered two operations management awards: one for powering up the substation for the BWP; and another for securing rights-of-way for the 128 towers that were to bring the energy produced by the BWP to the grid through overhead transmission lines.
Commissioning the Burgos substation was a technical challenge overcome just six days shy of the commissioning of a competing wind farm. When its foreign contractor failed to perform, EDC stepped in to complete the project. The team borrowed substation parts from other EDC power plants and the National Grid Corporation of the Philippines (NGCP). It turned to a global network of suppliers to source long-lead items. It was able to engage suppliers to replace custom-made parts that were lost. It banked on its strong working relationship with the NGCP, and tapped AECOM, which has expertise in energizing large wind farms, as technical adviser.
Successful on-time commissioning meant recurring annual revenues of P3B after the BWP qualified for the FiT rate.
At the same time, EDC’s right-of-way team was doing its share of the work. It took five years for a team of 18 to secure 100% of the needed land, involving 2,146 landowners covering an area of 800 hectares over 43 kilometers and 29 barangays. The task entailed processing more than 8,000 sets of land ownership documents. The team provided legal aid to landowners in closing documents and even helped them contact relatives when necessary.
The relatively quick negotiations were the result of the team’s extensive technical and legal knowledge of securing land rights; the efforts of local employees who knew how to speak Ilocano and understood the local scene, including what the landowners wanted; and the strategy of gaining local social acceptability by respecting the owners’ preference to lease land instead of selling land to EDC. The rights-of-way were secured, leading to the legal and on-time installation of the needed towers and transmission lines for the BWP’s proper commissioning.
Human Resource Focus
EDC scored a feat in this category with its unprecedented Unified CBA (collective bargaining agreement) Story, which documents the negotiation with seven rank-and-file unions in just one day. The seven unions negotiated as one during the process and did not submit any formal demands. Instead, they gave EDC management discussion points to guide the dialogue.
The unions accepted performance-based increases as proposed by management, giving rank-and-file employees the opportunity to be recognized for their individual performances. The unions’ agreement gave EDC a uniform performance management system across all levels of the organization.
Party-list representative Raymond Mendoza of the Associated Labor Unions-Trade Union Congress of the Philippines hailed the unified CBA negotiations as an “unprecedented feat in Philippine labor relations history.”
Corporate Image Building
EDC’s award for corporate image building did not only add luster to its corporate name, but also brought the Philippines back on the investment map. Project finance for its BWP was EDC’s first such deal in its 40-year history. Financial close was achieved in six months and made the BWP the first power project to be so financed under “the untested and uncertain Philippine feed-in-tariff regime.”
EDC obtained competitive rates for the $315M financing provided by a syndicate of five foreign and four local banks. Denmark’s export credit agency, Eksport Kredit Fonden (EKF), guaranteed a portion of the US dollar tranche, signaling EKF’s return to Asian markets.
The transaction was recognized as the Asia-Pacific Renewables Deal of the Year by Project Finance International, considered the “Oscars” in the project finance industry, and EDC was the only awardee from the Philippines. It was also judged as the Asia Wind Deal of the Year by Infrastructure Journal
Global; Asia-Pacific Deal of the Year by Trade Finance; “Top Ten” Global Deals of the Year- “Best Export Credit Agency-backed Green Deal” by Trade & Export Finance; and GTR Best Deal of 2014 by Global Trade Review. It further received an ACQ Award from Acquisition International.
ABS-CBN Lingkod Kapamilya Foundation Inc. (ALKFI) received an award for public responsibility for its Ugong Rock project that saw a community move from poverty to prosperity while exemplifying values important for national growth. Ugong Rock is a sustainable ecotourism site in Puerto Princesa, Palawan, manned by locals who used ALKFI’s seed fund of P1M to generate up to P30M a year in revenues. Sustainable ecotourism requires environmental protection, as well as ensuring the safety and well-being of visitors.
Ugong Rock community members earn P9,000 to P18,000 a month—higher than usual provincial wages of P220 to P275 a day. Some 275 families directly benefit from Ugong Rock operations, taking care of zip lines, spas, a restaurant, a photography shop, a cooperative store and high-value crops farming. The project is the model for similar sites in Mindoro, Romblon, Bicol, Samar, Leyte and Sarangani.
First Gas Power Corporation, together with FGP Corporation, ensured the almost immediate return to service of the Santa Rita and San Lorenzo natural gas-fired power plants after typhoon Glenda disrupted operations on July 16, 2014. Aside from flooding the site, the typhoon damaged Santa Rita’s liquid fuel facility, which allows it to continue operating even when there is gas supply curtailment. Typhoon Glenda also rendered the site’s jetty, which is used to receive liquid fuel deliveries, inoperable.
With a combined output of 1,500 MW, the damage to Santa Rita and San Lorenzo endangered electricity supply to the Luzon grid, threatening customers with power outage and high electricity prices, especially during demand. Despite being legally and financially protected against force majeure events like typhoons under its contracts, First Gas and FGP worked round the clock to restore normal operations. Within two days, 250MW was restored to the grid, equivalent to serving the needs of 175,000 households. The rest of capacity was restored within three to five days. Liquid fuel operation capability was restored by August 4, 2014 and the jetty was completely repaired by mid-January 2015. These actions were attributed to the team’s passion to serve public interest by protecting consumers from power outages and high electricity prices.
ABS-CBN received two awards for public responsibility: one for Failon Ngayon’s Padyak: the Pedicab Project; and another for E-TV Patrol: Patrol ng Edukasyon.
The Pedicab Project of Current Affairs program “Failon Ngayon” made skills training and values education a requirement for receiving 200 pedicabs. In partnership with the local government units of Palo, Tanauan, Dagami, Sta. Fe and Tabon-Tabon in Leyte, the team screened beneficiaries and then tapped the Technical Education and Skills Development Authority to create a module for the comprehensive training of pedicab drivers. Representatives from the Department of Tourism and Tzu Chi Foundation, which sponsored the manufacture of the pedicabs, spoke at the three-day seminar-workshop that covered traffic rules, first aid, maintenance and troubleshooting of pedicab units, moral values, personality development and Filipino hospitality.
The neatness and quality of service of the pedicab drivers so impressed other nongovernment organizations that they were encouraged to emulate the project, among them the Catholic Relief Services, Child Fund and Kabuhayang Pangkabataan. The 200 pedicab drivers received pedicabs as a means to support their families, but also received values education to become good examples to their fellow drivers and to be able to better guide their kapamilya on and off the road.Meanwhile, E-TV Patrol: Patrol ng Edukasyon provided educational TV packages to remote schools, invariably increasing enrolment, improving National Achievement Test scores and reducing dropout rates. The team also provided solar panels and lights in Bakyaan (Oriental Mindoro) where there is no electricity. In places like Lantayung (Oriental Mindoro), the team, with the assistance of the 203rd Infantry Brigade of the Philippine Army, built three classrooms, 20 houses, 69 outdoor restrooms and a big water tank to supply water to 11 faucets for an impoverished Mangyan community.
In selecting schools, the E-TV team chooses the remotest ones where the impact of the E-TV material and community aid would be greatly felt. The team surmounts physical and logistical challenges to serve the schools and the communities, crossing rivers and trekking mountains, entering areas of conflict and investing their time as well as their hearts educating schoolchildren and improving the living conditions of their families.
The winning teams carried the torch for the 13th cycle nominees and made the LAA a worthy celebration of business excellence in all six categories. (Story/Photo by: Carla Paras-Sison).