Ayala looks to boost hydro, solar in renewable portfolio

MANILA, Philippines - The power unit of conglomerate Ayala Corp. is looking to add hydropower and solar projects in its renewable energy (RE) portfolio in the medium to long-term, its top official said.

The hydro-power projects being privatized by the Power Sector Assets and Liabilities Management Corp. (PSALM) are attractive investments, AC Energy Holdings Inc. president and CEO John Eric T. Francia said on the sidelines of the Ayala-University of the Philippines School of Economics Economic Forum in Makati City.

“We’re interested in the hydro assets of PSALM. It’s more to diversify [our RE portfolio],” he said.

Among the power assets still to be privatized by PSALM are the 727.1-megawatt 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.

Currently, AC Energy is working on an 11-MW mini-hydropower project with Sta. Clara Power Corp. in Ifugao.

“We still have to get off the ground with hydro. There are local matters that we need to address and seeking community support for the project,” Francia said.

Meanwhile, AC Energy is not closing its doors on solar technology after shelving its 35-MW solar farm in Davao del Sur.

The Mindanao solar farm, to be developed with Mitsubishi Corp., was supposed to be Ayala’s first foray into solar development.

“We continue to monitor developments in solar. We are very much aware that panel prices continue to go down,” Francia said.

However, the Ayala power unit will not be take part in the second round of solar development under the feed-in tariff (FIT) scheme.

“We’re not participating in the race for that 500 MW where there’s a March 2016 deadline. But it doesn’t mean that we’ve forgotten about solar. We continue to study the prospects and our aspiration is to get to a stage where solar becomes competitive vis-a-vis the grid,” Francia noted.

Under the FIT, eligible RE developers will be given a set of incentives, which includes a premium rate for a period of 20 years, for their RE projects.

In the second round of FIT allocation for solar, developers are entitled to a FIT rate of P9.68 per kilowatt-hour.