Aboitiz Power Corp. eyes RE projects in overseas expansion

By Lenie Lectura – April 23, 201910
from Business Mirror

ABOITIZ Power Corp. (AboitizPower) is shifting its overseas prospect for renewable-energy (RE) projects in Vietnam.

The power firm, which earmarked P51 billion in capital expenditures (capex) this year, earlier announced its keen interest to expand overseas, possibly with a local partner.

Aside from Vietnam, the power firm is also eyeing Myanmar and Indonesia for expansion, but Vietnam is on its radar at the moment because of its similarity with the Philippine market.

Company officials led by Aboitiz Equity Ventures Inc. (AEV) and AboitizPower President Erramon Aboitiz said during a news conference on Monday afternoon that “a few deals” are currently being evaluated in the RE space in Vietnam.

“A lot of our efforts still have not borne any fruit in the last couple of years, although we are working on several projects currently in our focus countries, mainly Indonesia and Vietnam. We are looking at solar and wind. Right now, we’re focusing on Vietnam. They have their FiT (feed-in-tariff). We think that’s an opportunity for us. So, a lot of our efforts have shifted and are really focused on Vietnam. Hopefully, we will be able to announce a project soon,” he said.

After the press conference, Aboitiz revealed the company is looking at “roughly anywhere between 50 megawatts and 100 MW” of RE projects in Vietnam.

Timing is essential, since another round of FiT rates in Vietnam will take effect soon. FiT is a form of incentive paid to RE developers.

“They have set a price today that will expire in June or July this year. They already have a new FIT that will kick in and that goes on until October 2020, and then a new one comes again. Between now and 2021, AboitizPower’s Vietnam RE prospect should be ready,” Aboitiz said.

“More than that, we have to be ready and running by that time. Depending on what technology, if it’s wind, for example, to be able to meet the 2021 timeline, we have to have the project already, at least the permitting and all of that in order to meet that schedule,” he added.

A local partner in Vietnam that has started a project already is a must for AboitizPower. Ideally, the company is looking at existing projects that have been developed into a certain extent.

Earlier in the day, the company announced the appointment of company COO Emmanuel Rubio as AboitizPower President effective on January 1, 2020. Rubio will replace Aboitiz who is up for retirement.

“I intend to continue what he has started. I am sure there will be a lot of challenges—new and old—but with the help of the group, we will overcome the challenges,” Rubio said.

Aboitiz said the board approved Rubio’s appointment as incoming president and CEO after his retirement. “All of us are very happy with the approval. There was a lot of speculation as to who will take over my place and, definitely, a lot of people are looking at Manny, so it’s confirmed now. I am confident Manny will continue to achieve greater heights.”

About 80 percent of the capex is earmarked for baseload projects mainly for the construction of GNPower Dinginin Power Plants, while the balance is allocated for exploratory and operating activities.  AboitizPower believes it is well-positioned to take advantage of opportunities arising from developments in the power industry.

“We are working toward achieving our growth targets of 4,000 MW  by 2020. The acquisition—increasing our share in GN—puts us in a front seat in reaching close to 4,500 MW from where we are today,” Rubio said.