CEBU CITY – An industry official in Cebu’s information and communications technology (ICT) sector has expressed apprehension over continued talks of a power and water supply deficit in the province, a problem seen as a major risk factor in attracting business process and outsourcing (BPO) industry.

“It is high time that utility providers for power and water in Cebu immediately address the looming supply shortage,” said Gregg Gabison, an official with the Cebu Educational Development Foundation for Information Technology (CEDF-IT), a private sector-led organization advocating for ICT investments in Cebu. “Otherwise, Cebu will miss a good chance of luring in big BPO investors.”

Gabison, who recalled prior talks with some ICT locators in Cebu said industry players feared that with more BPO companies expanding in Cebu, the province’s water supply, in particular, “will not be able to sustain the requirement of investors.”

A much more pressing concern, he underscored, is the power shortage in the Cebu-Negros-Panay grid that has been resulting in several power outages in the Visayas.

In September alone, power distribution utility firm Visayan Electric Company (VECO) is expecting a shortfall between 10 to 20-megawatts (MW), according to Sebastian Lacson, the company’s Vice President for Administration and Customer Service Group.

“Basic necessities like water and power supply should be properly tackled,” stressed Gabison. “Government and the private sector must seriously take a look at investing more on these utility projects or else we are bound to lose more investors.”

He gave a nod of approval for the Cebu Energy Development Corporation (Cebu Energy)’s 246-MW coal-fired power plant project in Toledo City which is designed to mitigate the looming power shortage in Cebu.

Cebu Energy President Jesus Alcordo earlier said the company is speeding up negotiations for potential power distribution buyers in time for the operation of the plant’s first 82-mw unit in February 2010.

In a related development, VECO announced that it is building a transmission line for Cebu Energy, in pursuit of its mandate to deliver quality, efficient and reliable service.

A statement issued by VECO informed that it has prepared the following proposed major capital projects to be implemented within its franchise area for this year: 37-km Sangi-Naga 138 kV Tie Line, and a 138 kV Switchyard & 100 MVA 138/69kV Substation.

The 37-km Sangi-Naga 138 kV Tie Line will be dedicated to the supply of power from the Cebu Energy power plant in Toledo City, as contained in a Memorandum of Agreement signed last August 3 between VECO and Cebu Energy.

Gabison said that in terms of water, he has yet to see more big ticket projects to be launched by water industry players.

In a separate interview, Antonio Tompar, chairman of private bulk water provider, Mactan Rock Industries Inc. said the firm is currently negotiating a joint venture with the Metro Cebu Water District for a joint venture deal for the provision of at least 5,000-cubic-meter water a day.