Alsons allots $650 million for hydro, solar projects

by Lenie Lectura – February 22, 2016

from Business Mirror

ALSONS Renewable Energy Corp. (Arec), a subsidiary of Alsons Consolidated Resources Inc. (ACR), is earmarking $650 million to pursue investments in hydro and solar projects, with a total generating capacity of 205 megawatts (MW).

“Alsons has a clear strategy for developing RE [renewable energy], starting with hydro,” Alsons Vice President for Business Development Joseph Nocos said.

He said investments in hydro-power projects will amount to $600 million.

“We have 80-MW to 90-MW hydro-service contracts under application with the DOE [Department of Energy] which we expect the DOE to decide on within the year. If all of those are approved, then we will end up with a total hydro portfolio of 180 MW, which we hope to implement in the next five years,” Nocos said in a news briefing.

Arec is set to construct this year a 15-MW run-of- river hydroelectric plant along the Siguil River in Maasim, Sarangani. Nocos said this will be followed by a 40-MW hydropower project in Negros Occidental, and two more hydro projects in Mindanao that “will be rolled out in the next couple of years.”

For solar, Arec is looking at developing 20 MW to 30 MW of capacity for $40 million to 45 million.

“The solar projects will be in General Santos,” Nocos added.

ACR, which is expected to contribute 600 MW of capacity to Mindanao, is shifting its focus to RE.

“Our approach is to match the design of what the grid needs. During the early 2000s, we were determined that Mindanao will need a baseload toward the latter part of 2000. So, we embarked on it, but looking ahead to what we believe Mindanao will need in the next 10 years to 15 years. We see this: First, there is enough baseload capacity that other gencos [generating companies] are also building. So, I believe, there will be enough baseload in next 10 years to 15 years,” he said.

“In the intervening period, between now and 15 years, hence, the opportunity for gencos is RE space. If we look at RE space, our main interest is hydro and solar,” Nocos said.

These RE projects, he added, will “result in improvements” in ACR’s bottom-line as the company is positioned to grow “more prominently” in the power industry in the coming years.

“The ratio between non-RE and RE would be 75:25, in favor of non-RE. If you look at it 10 years in the horizon, the ratio would probably turn out 50:50,” he said. ACR currently operates three diesel power plants. These are the 103-MW plant of the Mapalad Power Corp. in Iligan City; the Southern Philippines Power Corp.’s 55-MW power plant in Alabel, Sarangani; and the 100-MW Western Mindanao Power Corp. plant in Zamboanga City. All have significantly contributed to alleviating the power shortage in Mindanao.

ACR is developing coal-fired power facilities to help provide a stable source of baseload power for Mindanao and ensure long-term power security for the island. These facilities are the 105-MW San Ramon Power Inc. (SRPI) plant in Zamboanga City; and the 210-MW Sarangani Energy Corp. (SEC) plant in Maasim, Sarangani.

The first 105-MW section of the SEC plan is now in the advanced stages of testing and commissioning, and will begin commercial operations in the first quarter of 2016 with an initial capacity of 105 MW. The SEC plant is expected to be operating at its full 210-MW capacity in 2018. The SRPI power facility in Zamboanga City is expected to begin construction in 2016 and slated to operate by 2019.

The Alcantara Group, through its other subsidiaries aside from ACR, is also engaged in aquaculture and agribusiness, property development and services. It has been an active player in the economic development of Mindanao and the rest of the Philippines for over 50 years.