Ayala Investing $2.5B In Power

In a move that will likely challenge the dominance of existing industry 'big leagues', the energy arm of the Ayala Corporation is lining up $2.5 billion worth of investments in the next five years to put in targeted installed capacity of 1,000 megawatts.

"That (1,000MW) is our benchmark ... 1,000MW will cost around $2.5 billion," Ayala Corporation managing director Eric T. Francia has told reporters on the sidelines of a Renewable Energy Opportunities Forum hosted by the Philippine Stock Exchange (PSE) and CFA Society of the Philippines.

Of the total pipelined capital outlay for power projects, he noted that $500 million will account for equity that the company and prospective partners are bound to inject within the planning horizon.

Francia has emphasized that the targeted installations could be a combination of greenfield developments (new power plant builds) as well as acquisitions.

"If we can land some interesting acquisitions, we can exceed that. But if not, that would be a tall order if it's all greenfield," he pointed out.

When asked if the Ayala group's scaled up investments in the power industry would be a strategy to position itself among the largest players over the short term, Francia tersely commented that "we're patient."

He thus indicated that "for the conventional technologies, we're looking at a few greenfield opportunities. We're looking across the country. We're looking at possibilities in Visayas and Mindanao - there are two areas where we planned new power plants."

If ever, that will add up to the Ayala group's power portfolio which has been kick-started by their 135-megawatt coal plant in Batangas, a joint venture with Phinma Group's Trans-Asia Oil and Energy Development Corporation.

For renewable energy (RE) alone, the target will be 200 megawatts and the capacity installations may be dominated by hydro, given that solar development prospects could be on the 'fledgling path' because of the lower-than-expected feed-in-tariff (FIT) approved by the industry regulator.

The five-year stretch in Ayala's blueprint will refer to the timeframe when they can get financial closing for the targeted projects.

"That's construction. It's virtually impossible if you do all of it for greenfield. It will just be reaching financial close. If there's going to be some acquisitions, then it could be on stream," Francia has explained.

"20% of power will be RE, roughly $150 million of equity would be on renewable because we have a balanced portfolio between the traditional thermal baseload and renewable technologies," he stressed.

Hydro capacity target will be for 100 to 150 megawatts and it will likely be a joint venture with Santa Clara Power Corporation.

The company's planned 30 to 50MW solar capacity, Francia admitted, will have to be reviewed on account of the FIT that has been anticipated to support investment returns for that technology application.

"It's going to be predominantly hydro. Solar, it really depends. We are building 30 to 50 megawatts but given the feed-in-tariff rate, we're going to revisit if it's going to be feasible. It's really a challenge," he averred.

Editor’s note:Yahoo Philippines encourages responsible comments that add dimension to the discussion. No bashing or hate speech, please. You can express your opinion without slamming others or making derogatory remarks.

  • Batangas women bear ‘the cross’ to save loved ones VERA Files - The Inbox
    Batangas women bear ‘the cross’ to save loved ones

    Text and photos by Jane Dasal, VERA Files Nasugbu, Batangas—At the break of dawn on Good Friday, Celilia Zafra donned a black dress and shrouded her face with a black cloth. Then she walked to a place called “putol na … Continue reading → …

  • Chronicling the komedya in Antique VERA Files - The Inbox
    Chronicling the komedya in Antique

    By Alex C. Delos Santos, VERA Files The first time Cecile Locsin-Nava, a scholar on cultural studies in Western Visayas, came to Antique around ten years ago was to gather data for a research on the korido, or Philippine narrative … Continue reading → …

  • Ayungin dilemma Ramon Casiple - Parallaxis
    Ayungin dilemma

    China faces a dilemma in Ayungin Shoal and other contested areas. If it waits for the ITLOS—which may decide against it—it would have tacitly bound itself to UNCLOS and risk a rogue state reputation if it asserts its claim in the South China Sea. If its militarily acts now, it may face international isolation. …

POLL
Loading...
Poll Choice Options