Wednesday, April 25, 2018

Ayala mulls $2-B new investments in power


Published April 23, 2018, 10:00 PM By Myrna M. Velasco

The energy investment arm of Ayala Corporation has preliminary calculated additional equity investments of up to US$2.0 billion for planned expansion projects in the domestic and international power markets to scale up its power generation portfolio to 5,000 megawatts.
This will be on top of the US$1.0 billion equity investments that the conglomerate had already forked out leading to its 2,000MW capacity target by year 2020.
“That gap where we are today and that over 5GW is going to require over US$2.0 billion of additional equity investments until 2025. That’s our big picture plan, that’s our 2025 vision,” AC Energy Holdings President and CEO Eric T. Francia has noted.
He qualified that the 2025 vision of the company into reaching 5.0GW capacity had just been approved by its board of directors weeks ago.
Francia said the next 3,000 megawatts in their power generation capacity build-up “will be a combination of overseas and domestic investments…and also a combination of thermal and renewable energy technologies.”
The Ayala energy firm made clear that initial markets for its overseas expansion shall be Indonesia and Vietnam; with the company already making headway when it comes to cornering capacities through acquisition or in pursuing greenfield power projects in these two Southeast Asian power markets. “Right now, we’re roughly 80:20 in terms of our investments – domestic versus international. I believe that at least 50-percent of that incremental investment between now and 2025 will be international,” the AC Energy chief executive stressed.
With the Philippine power market at saturation point between now until year 2023, he noted that domestic opportunities may not come in massive scale of megawatts in the next 4-5 years.
“That depends on opportunities abroad as well as here in the Philippines. Because it’s not just us who’s investing here (domestic market), so depending on how intense the competition is, that number could be much lower than 50% and depending on how we can scale up internationally,” Francia expounded.
Nevertheless, he asserted that “my gut feel is at least 50% will be international, because there would be a lot of different options – because if there is overcapacity in this market, we can always go into another market…or if one government is promoting a more viable environment for investment, we can consider – so there’s more flexibility.”

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