MANILA, Philippines - Conglomerate Ayala Corp., through unit AC Energy Holdings Inc., has finalized its partnership with listed firm A. Brown Co. Inc. for a P12.5-billion coal plant in the Visayas.
The new power facility is expected to provide additional electricity amid a tight supply situation in 2016.
In a disclosure, AC said AC Energy “finalized and executed their shareholders’ agreement, which documents and implements respective agreements and undertakings among Palm Concepcion Power Corp. (PCPC).”
AC Energy signed the deal with A. Brown subsidiary Palm Thermal Consolidated Holdings Corp. and Jin Navitas Resource Inc. on Oct. 31.
The agreement also confirms the terms and conditions by which PCPC will be owned and managed.
PCPC is building a 135-megawatt (MW) circulating fluidized bed thermal coal-fired power plant in Iloilo province.
“PCPC’s power plant project is envisioned to fill the anticipated tight power supply situation in Panay and the Visayas grids by 2016, as economic activity continues to expand in the area,” A. Brown said.
In September AC Energy announced it will join A. Brown for the coal power plant, which will break ground within the fourth quarter of the year.
The plan includes a second 135-MW facility for future development.
AC Energy targets to be a major contributor in the Ayala conglomerate, which is into property (Ayala Land Inc.), banking (Bank of the Philippine Islands), telecommunications (Globe Telecom Inc.) and utilities (Manila Water Co. Inc.).
AC Energy plans to start construction of power plants with a combined capacity of 1,000-MW in the next five years which will require as much as $2.5 billion in investments.
While the Visayas power grid has stable supply of electricity, it will need additional power plants in the next five years to cope with the growing demand for power from consumers.
Under the Philippine Power Development Program 2010-2030, the Visayas grid needs 2,150 MW in new capacity but only 654 MW is already committed and 186 MW is still indicative.