Ayala set to enter power sector; eyes bid for two power plants

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SUNDAY, 02 SEPTEMBER 2012 18:21 PAUL ISLA

CONGLOMERATE Ayala Corp., a new entrant in the power sector, is looking at  participating in the bidding of two power plants and become a formidable player in the country’s power sector.

By participating in the independent power producer administration (IPPA) selection process, Ayala Corp. “is looking at the Power Sector Assets and Liabilities Management Corp.’s [PSALM] next round of bidding,” Eric Francia, Ayala managing director, told reporters in an interview. He said he understands that the IPPA selection for the 140-megawatt (MW) Casecnan hydropower plant and the 559-MW Unified Leyte geothermal power complex is upcoming.

Francia said they have yet to decide if they will bid alone or partner with another company.

“For now, we don’t have any decisions on partners for those  two biddings,” he said.  Earlier, he said Ayala is looking at building up its power portfolio through a mix of greenfield projects and also by bidding for the contracted capacities and/or assets of the government.

Francia said Ayala plans to build at least 1,000 MW of power-generation capacity in the next five years. The targeted generating capacity would entail $2.5 billion in investments. He said they have earmarked $500 million as equity for these planned projects.  “The 1,000 MW is our benchmark. If we can exceed that and if we are fortunate to land some interesting acquisitions, then we can exceed that. But if not, that can be a tall order if it’s all going to be greenfield projects,” he said.

PSALM earlier said it targets to select through a bidding process the IPPA for the Casecnan and the Unified Leyte this year.

As of February this year, PSALM has generated around $10.21 billion in proceeds from the successful sale of the power and transmission assets and the transfer of IPP contracts to IPP Administrators.

Of this amount, PSALM has so far collected $5.472 billion of which $5.477 billion (including income interest) was used to settle its maturing obligations. PSALM has yet to collect $9.99 billion in additional proceeds from the transfer of IPP contracts to private administrators as of September 2011.

(Paul Isla)     source