Other project documentation
Environmental compliance
An Environmental Impact Statement was submitted to the Department of Environment and
Natural Resources in June 1995 and an Environmental Compliance Certificate for the project
was issued in April 1996. The project is designed to meet the most restrictive Philippine envi-
ronmental standards and US Eximbank guidelines for air emissions, water discharge, noise
levels and protection against natural disasters (earthquake, wind and flood). The project com-
pany developed a comprehensive monitoring plan to ensure compliance during construction
and operation.
Plan for sustainable development
In an article in Project Finance(February 2001) Jeffrey E. Goldstein and Michael B. Selvin
of Bechtel Enterprises Holdings, Inc., described how the project sponsors designed and
implemented a programme for sustainable development.^5 They cite the following definition
of sustainable development from the report of the UN Commission on Environment and
Development, published in 1987: ‘development that meets the needs of the present without
compromising the ability of future generations to meet their own needs’. For a project such
as Quezon Power, this meant creating an integrated approach to development, design, con-
struction, operation and decommissioning, taking three principal elements into consideration:
economic development, environmental protection and social responsibility.
Despite the advantages of the plant site, including deepwater access for coal importation
and a sheltered harbour, the sponsors realised that the construction and operation of a large
power plant would impose substantial burdens on the local community. They wanted to make
sure that there were offsetting benefits as well.
The plant, coal storage facility and ash disposal area required land from 50 separately
owned parcels, and the acquisition of rights of way for the 31-kilometre transmission line had
an impact on 400 additional properties. Residents directly affected were offered relocation
and compensation packages. Vocational training programmes were developed for people
from local farms and commercial enterprises whose livelihoods were affected.
The project sponsors drew up a memorandum of understanding with all the stakeholders,
including the municipality, the province and the Philippine Department of Environment and
Natural Resources. The memorandum defined legal, communication and other obligations on
both sides. The sponsors agreed to provide:
- an electrification fund to provide power to local residents;
•a development and livelihood fund to be used for a microlending programme; - environmental funds to ensure plant compliance with environmental regulations, and to
provide for protective measure such as reforestation, watershed management and moni-
toring offshore ecology; and - additional financial support for schools, roads, an irrigation dam and improvement of the
water supply.
Before the plant was constructed there were frequent ‘brownouts’ and ‘blackouts’ in the vicin-
ity of the project. Now, because Philippine Department of Energy rules require that 25 per cent
POWER PLANT