MANILA -- AC Energy Philippines aims to have about 2,000 megawatts (MW) capacity by 2025 to become the leader in renewable energy (RE) in the country, with the groundbreaking of its RE plants seen in the next six months.
In a briefing Tuesday, AC Energy president John Eric Francia said although RE power plants are easier and faster to construct compared to the conventional power plants, they plan to start early to be able to meet the standards, “which assumes that a lot of renewables will be built starting 2023.”
“The timing is there given that renewable plants, yes it’s faster to develop relative to conventional plants, but still time is ticking away… so we have to get going with some groundbreaking on a measured basis,” he said.
“I don’t think it will be going in a step increase overnight but we want to make sure that we are building on a measured basis. Start with a few hundred megawatts, couple of hundred megawatts. Hopefully, break ground in the next six months or so and then progress from there,” he said.
Francia noted the Ayala Group’s power generation arm wants to be a major player in the industry given the rising demand for power due to the continued strong output of the domestic economy.
He also cited as a plus the improvement of cost and efficiency of RE amid improved policies of the government.
“With the government’s target of renewables reaching 35 percent of energy output by 2030, the country would need to build over 15 gigawatts (GW) of renewables in the next decade,” he said.
“We will make significant investments in this space,” he added but declined to give figures.
Relatively, the company has completed the acquisition of Phinma Energy Corp. for PHP6.3 billion.
Francia said the acquisition will help AC Energy meet its target to have 5GW of RE capacity by 2025.
He said the cost from the acquisition will be offset by gains from the power supply agreement (SPA) with Manila Electric Company (Meralco).
Phinma will be supplying Meralco 110 MW mid-merit capacity, wherein output is adjusted based on demand, for five years effective December 26, 2019.
The agreement was signed after the power generation company passed the competitive selection process (CSP).
Francia said South Luzon Thermal Energy Corp. (SLTEC), which is a joint venture among EC Energy, Phinma Energy, and Marubeni Corporation’s Axia Power Holdings Philippines Corporation, will be providing Meralco the agreed capacity.
He said the power generation deal is “a significant part of our turn-around because we are using SLTEC capacity for that.”
“It stabilizes our cash flows. Yes, we’re taking some risks but the beauty of the Phinma Energy or AC Energy now is we have a wide portfolio so we believe that we can manage that risk,” he added. (PNA)
