AC Energy to sell hydro projects to concentrate on other RE sources

By Lenie Lectura – January 3, 2017

from Business Mirror

AC Energy Holdings Inc., the power arm of conglomerate Ayala Corp., is letting go of its hydro investments to focus on other renewable-energy (RE) sources.

In a disclosure to the stock exchange on Tuesday,  AC Energy said it signed deals to sell all of its ownership stake in each of QuadRiver Energy Corp., Philnew Hydro Power Corp. and PhilnewRiver Corp. to Sta. Clara Group Inc.

The power firm held a 70-percent stake in each of the hydro firms, with the remaining 30 percent held by Sta. Clara Power Corp.

The three hydro firms are grantees of several hydropower service contracts from the Department of Energy (DOE).

AC Energy President John Eric Francia said the company’s direction for now is to focus on developing solar and wind power projects, and possibly revisit hydro in the future.

Prior to the sale, both were working on minihydropower projects in Ifugao. The company, Francia earlier said, was also open to participating in the privatization of the remaining hydropower assets owned by the government to diversify its RE portfolio.

Among the power assets still to be privatized by the Power Sector Assets and Liabilities Management Corp. (PSALM) are the 727.1-megawatt (MW) seven-unit Agus hydroelectric power plants and the 255-MW Pulangi hydroelectric power plant in Bukidnon.

Francia said these assets will be sold and will not be under an independent power producer (IPP) contract, which makes them attractive.

AC Energy is targeting another 1,000 MW of additional capacity, from the current 1,000 MW already in place together with partners.

Of the new target, the company expects 60 percent to come from RE sources.

“We expect RE to be more competitive over the next five years,” Francia said.

AC Energy’s attributable capacity is currently pegged at 1,088 MW. It will start construction of the 668-MW GN Power Dinginin Ltd. Co. coal plant in Bataan. Existing projects with partners include the 604-MW GNPower Mariveles, the 2×135-MW coal-fired power plant in Calaca, Batangas, under South Luzon Thermal Energy Corp., and the 4×135- MW coal-fired power plant in Kauswagan, Lanao del Norte, in Mindanao through GN Power Kauswagan Ltd. Co.

AC Energy’s RE portfolio, meanwhile, includes the 52-MW Northwind Power Development Corp. in Bangui, Ilocos Norte, and the 81-MW wind farm in Pagudpud, Ilocos Norte, through its affiliate North Luzon Renewable Energy Corp.; and the 18-MW Monte Solar Energy Inc. (Montesol) plant in Negros Oriental, a joint undertaking with Bronzeoak Clean Energy Inc.

“The renewable-energy revolution is upon us and we are gearing up the organization for this new reality. We will also harness synergies across the Ayala Group to achieve this goal,” Francia said. “We expect renewable energy to be more competitive over the next five years, and this will be good from a sustainability, diversification and resiliency standpoint.”

Just recently, AC Energy, and as part of an Indonesian consortium and a Philippine consortium, signed share sale and purchase agreements with Chevron Global Energy Inc., Union Oil Co. of California and their relevant affiliates for the purchase of Chevron’s geothermal operations in Indonesia and the Philippines.