THE power unit of conglomerate Ayala Corp. is investing $20 million to partly finance the development, construction and operations of renewable-energy (RE) power projects in the Asia-Pacific (AsPac) region, with a goal of building a portfolio of over 1 gigawatt in the next few years.
AC Energy, through AC Renewables International Pte. Ltd., will undertake these power projects together with UPC Renewables, through UPC Solar Asia Pacific Ltd.
They formed a 50-50 joint-venture company known as UPC-AC Energy Solar.
“AC Energy is investing $20 million via a development loan to finance the development of this pipeline and expects to provide all the construction equity required for these projects,” AC Energy said.
In particular, the initial focus on building UPC-AC Energy Solar’s power portfolio is set in India, South Korea and Taiwan.
The new investment will enable the group to accelerate development of projects in the region, said UPC Renewables Chairman Brian Caffyn. “As partnerships and growth opportunities arise, we are always looking at ways to significantly scale up our renewable-energy portfolio. AC Energy has always been focused on large-scale projects and is managed by a high-quality management team. We are grateful for their continuous support to the UPC group,” said Caffyn.
Patrice Clausse, AC Energy chief operating advisor and AC Renewables International director, said the company is on its way to achieve a balanced energy mix. “AC Energy is very excited to invest in another partnership with UPC Renewables. Our move to enter into a large and bankable solar market like India is consistent with AC Energy’s goal to exceed 5,000 megawatts by 2025, with at least 50 percent to be sourced from renewables,” said Clausse.
Pranab Kumar Sarmah, CEO of UPC-AC Energy Solar and co-founder of UPC Solar Asia Pacific, lauded the revitalized partnership. “We are pleased to have AC Energy as our joint-venture partner at a crucial point when UPC Solar is ready to accelerate construction activities of its pipelines and continue its humble journey to reduce carbon footprint. We aim to make this partnership a competitive regional solar project development and asset management platform.”
UPC Renewables’ and AC Energy’s partnership started in 2013 for the development, construction, and operations of North Luzon Renewables, an 81-MW wind farm project in Pagudpud, Ilocos Norte, Philippines. In January 2017, the two groups invested in PT UPC Sidrap Bayu Energi, developer of a 75-MW wind farm in South Sulawesi, Indonesia.
Low-temperature geothermal fluids, whether in untapped sites or in the reinjection facilities of producing projects, represent a potential avenue for growth for the Philippine geothermal industry. This was a topic discussed in several presentations during the 1st Philippine Geothermal Conference in Marquis Events Place, Taguig, Metro Manila.
With a focus on developing non-conventional geothermal resources, private and government entities have looked into low-temperature fluids as a means to grow the country’s geothermal power production capacity.
Rizabigail Reyes, Science Research Specialist of the Geothermal Energy Management Division of the Department of Energy, reported on their group’s efforts to characterize the low-temperature geothermal prospects in the Philippines through geoscientific surveys. By conducting exploration on these sites – including Camiguin de Babuyanes and El Nido – they can reduce the risk of development and hope to more easily attract private investors.
Richard de Guzman from Energy Development Corporation also presented the results of an ongoing project to utilize the reinjection brine in the Bacman Geothermal Field for optimized power production. With a mass flow of 400 kg/s and temperature of 150 C, the reinjection fluid has the potential to add to the field’s production capacity through binary technology.
However, silica scaling remains one of the biggest challenges of such an undertaking. The group of de Guzman has conducted scaling treatment trials on the geothermal brine and hopes to implement them in the near future.
Energy Development Corp. (EDC) is planning to expand the production capacity of existing geothermal plants by 50 to 60 megawatts (MW) in the next two years, its top official said Wednesday.
“We just have a small expansion within our existing sites,” EDC president and CEO Richard Tantoco told reporters on the sidelines of the Philippine International Geothermal Conference in Taguig City.
“For the next two years, mga 50 to 60 MW,” Tantoco said.
For the capacity expansion, EDC is looking at the “optimization” of existing geothermal plants.
“One is in Leyte,” Tantoco noted.
EDC’s geothermal power plants in Leyte have a combined capacity of around 400MW.
“We’re working on partnerships. I don’t know pa the final price. [Ongoing] ang negotiations now,” Tantoco said. “We’re very interested to invest, so we’re looking for partners.”
As of December 31, 2017, EDC and its subsidiaries owned and operated a diversified portfolio of renewable energy projects in the Philippines with a total installed capacity of 1,472 MW, including geothermal, hydro, wind, and solar.
EDC said its power generation in 2016 represented approximately 9% of the country’s total power generation capacity. —VDS, GMA News
With the theme of “Beyond Conventional: Tapping New Geothermal Frontiers”, a message of ambition and innovation was the thread that connected the different speeches and presentations during the first day of the 1st Philippine Geothermal Conference at the Marquis Event Place, Taguig, Metro Manila.
Organized by the National Geothermal Association of the Philippines (NGAP), the 1st PGC has become the first conference in the Philippines to gather geothermal industry leaders and experts to share their knowledge and experience in tapping “non-conventional” geothermal sources.
Joeffrey Caranto, President of NGAP, opened the ceremonies by recounting the history of the geothermal industry in the Philippines. Since the late 1970’s, the Philippines has enjoyed an impressive growth in geothermal power production capacity, spurred by rich geothermal resources and the technical expertise of New Zealand’s KRTA.
However, after two waves of successful growth, the country is now experiencing a stagnation – growing their capacity by only 72 MW in the last 10 years and yielding the second spot in the global geothermal capacity rankings to Indonesia just this year.
Richard Tantoco, President and COO of Energy Development Corporation, said that the local geothermal industry had “no one to blame but themselves” for the lack of growth. With other renewable energy technologies, such as solar panels, wind turbines, and batteries dropping in cost, geothermal energy will become obsolete if they don’t change the way they do things.
In the part of EDC, Tantoco cited how their efforts in the past years have reduced drilling costs by 46% and reduced the downtime due to preventive maintenance from 63 days to 18 days – resulting in up to Php700 million in additional net income to the company.
Part of the efforts of the geothermal community to innovate is to come up with ways to tap into “non-conventional” geothermal resources. Caranto cited low-temperature systems, systems with acid fluids, and hot dry rock systems as typical examples.
“The Philippines is one of the top 3 countries most vulnerable to climate change, yet coal comprises 52% of our energy mix.” added Tantoco. “We have the duty to do things better. Be bold – experiment and innovate.”
Malaysia’s solar photovoltaics (PV) industry is on the rise thanks to strengthening government support, growing investor confidence and reducing costs.
Already ASEAN’s biggest solar PV employers, Malaysia’s solar sector is well poised for more growth given the favourable conditions that are developing.
Besides having relatively high irradiation levels, Malaysia already has an established solar manufacturing sector, although most of the solar equipment used is exported at present.
“The expanding domestic manufacturing base for renewables components will ensure that there is a reliable and low-cost supply chain for project developers amid global falling technology costs,” noted Fitch Solutions Macro Research in a report last month.
“We believe that this will be a key supportive factor to the Malaysian solar industry over the coming year, as greater numbers of manufacturers set up in the country,” added the credit rating agency.
Policies
Renewable energy is being promoted at the highest levels of government, and speaking at an environmental event on the side-lines of the United Nations General Assembly (UNGA) in New York last week, Malaysian Prime Minister Dr Mahathir Mohamad promised that current incentives and tax breaks such as the Green Technology Financing Scheme and the Green Investment Tax Allowance will be continued to spur further development in the renewable energy sector.
Such policies are needed if Malaysia is to achieve the ambitious target of increasing its energy generation mix from renewable energy from two percent in 2018 to 20 percent by 2025 as announced by the Energy, Science, Technology, Environment and Climate Change Ministry last September.
Malaysia has the potential to generate more than enough electricity to meet its current demand if all the roofs in Peninsular Malaysia are fitted with solar panels.
There are over 4.12 million buildings with solar rooftop potential in the peninsular (West Malaysia) said Malaysia’s Energy, Science, Technology, Environment and Climate Change Minister, Yeo Bee Yin in May, and they could generate 34,194 megawatts (MW) of electricity if they are fitted with solar PV systems. The country’s total electricity production currently stands at an average of 24,000 MW.
Source: Sustainable Energy Development Authority (SEDA)
The revised Net Energy Metering (NEM) scheme has also been received well, and a total of 16.6 MW of NEM was approved by industry regulators Sustainable Energy Development Authority (SEDA) in the first four months of 2019 compared to 18.24 MW in 2018.
Since the NEM’s introduction in 2016, solar power producers would sell excess electricity to Malaysia’s largest electricity utility company, Tenaga Nasional Berhad (TNB), at RM0.31 pkWh (US$0.07 per Kilowatt per hour) and purchase it at about RM0.50 (US$0.11) pkWh.
But since 1 January, the sale and purchase prices of electricity under the NEM has been at the same price – a move aimed at improving solar PV’s return on investment.
Reduced cost
As it is, solar energy has now become cheaper than gas-generated power thanks to advances in technology.
The government of Malaysia opened bids for an estimated RM2 billion (US$477 million) worth of projects under the third round of the Large-Scale Solar (LSS3) scheme in February, and speaking to local media last month after the bidding process ended, Yeo revealed that the first four projects – 365 MW out of 500 MW – were actually bid below the gas-generation price of RM0.2322 (US$0.0554) per kWh.
“In the second round of LSS bidding (in 2017), RM0.32 (US$0.0763) per kWh was the lowest price; that became our reference price when we opened LSS3 for bidding this year. But when the bidding exercise closed, the lowest bid was at RM0.1777 per kWh (US$0.0424),” she said.
“That is a 45 percent reduction in just a few years. That is why we are very confident that the renewable energy price will reach parity (with that of gas) in the foreseeable future,” she added.
Investment
Businesses and investors have taken note of this, and SEDA approved 17 solar investor applications in the first three months of this year alone.
Yesterday, CIMB – one of the country’s largest banks – announced it had allocated RM100 million (US$23.9 million) to its renewable energy financing scheme for small and medium enterprises (SMEs), and one of its main initiatives is to provide companies with 100 percent financing to cover the cost of solar PV systems and installation on their rooftops in support of the NEM scheme.
“Our planet is at a tipping point from an environmental, economic and social (EES) perspective, and we must take action now … to begin pursuing profits with a purpose,” stressed CIMB Group CEO, Zafrul Aziz.
On 19 September, Mydin Mohamed Holdings Berhad (Mydin) became the first chain retailer in Malaysia to install a solar PV system at its outlet in the city of Ipoh, in the northern state of Perak. They expect the 324 kilowatt-peak (kWp) solar PV installation in the department store to save up to RM3.24 million (US$773,000) in electricity bills throughout its 25-year lifespan.
In June, the Seberang Perai Municipal Council (MPSP) in the northern state of Penang became the first municipal council in the country to choose solar energy generation by installing solar panels on the rooftops of public markets and some state government offices.
With TNB proposing an internal restructuring of its generation, transmission and retail divisions – which is expected to be completed in the third quarter of 2020 – the increasing liberalisation is set to improve competition and grow investments in the solar PV sector.
SINGAPORE – Sunseap Group’s unit, Sunseap Leasing, has won a tender to install more than 170,000 solar panels at 1,218 HDB blocks and 49 government sites, which include 30 schools, 13 Ministry of Defence sites and the National Library Building.
Installation is expected to begin in early 2020 and complete by the third quarter of 2022.
The project comes under the fourth leasing tender from the Housing & Development Board (HDB) and the Singapore Economic Development Board’s joint SolarNova programme. The tender was called in December 2018 and received eight bids from both local and foreign companies.
This is the second SolarNova tender won by the homegrown solar energy provider, the first being in 2015.
The latest project’s solar photovoltaic (PV) capacity of 70 megawatt-peak (MWp) is a 40 per cent increase from the last awarded tender of 50 MWp.
The SolarNova programme aggregates solar demand across government agencies to leverage economies of scale, allowing agencies with smaller energy demands to utilise clean energy at a lower cost.
HDB said it contributes significantly to the national solar energy target of 350 MWp by 2020, with more than 60 per cent coming from its solar initiatives and programmes.
“This enables the generation of 277 gigawatt hour of clean energy annually, which is equivalent to powering about 57,500 four-room flats with clean energy, and potentially reducing carbon emissions by 138,500 tonnes each year,” said HDB.
Energy from PV panels on HDB blocks will be used in the day to fully power common services in HDB estates, such as the blocks’ lifts, lights and water pumps.
These blocks are able to achieve net-zero energy consumption with excess solar energy channelled back to Singapore’s electrical grid, said HDB.
As at August 2019, about 2,000 HDB blocks have been fitted with solar panels, and solar PV installation at another about 2,370 HDB blocks is in progress.
Installation works under the first three tenders in the SolarNova programme is estimated to complete by end 2020.
Frank Phuan, CEO and executive director of Sunseap Group, said Sunseap’s significant participation in the installation of solar systems across Singapore is “in line with Singapore’s pledge at the recent United Nations Climate Action Summit where our prime minister said that Singapore will be switching to a cleaner fuel mix and using cleaner energy solutions in order to reduce our carbon emission by 2030”.
For the project, Sunseap will deploy at least 170,000 bifacial solar panels, which unlike typical solar panels, can generate power on both sides of the modules and increase energy yield by up to 15 per cent, Mr Phuan said.
The bifacial panels can also last up to 30 years as compared to 25 years previously.
NDO – The Asia Development Bank (ADB) will provideDa Nhim – Ham Thuan – Da Mi Hydro Power JSC (DHD) a loan of US$37 million to install a 47.5MW peak floating photovoltaic (PV) solar power facility on the reservoir of DHD’s existing 175 MW Da Mi hydropower plant, following a signing ceremony in Hanoi on October 2.
The project is the first large-scale installation of floating solar PV panels in Vietnam and in Southeast Asia.
“This project will help to boost the share of renewable energy in Vietnam’s overall energy mix and decrease the dependence on imported fossil fuels such as coal,” ADB Private Sector Operations Department Deputy Director General Christopher Thieme said.
“The pairing of these two clean energy technologies – hydropower and solar – is a simple but highly innovative achievement which can be replicated elsewhere in Vietnam and across Asia and the Pacific,” he noted.
Chairman of the Board of DHD Nguyen Trong Oanh said: “We are proud to be the first company in Vietnam to construct a floating solar power plant on a hydropower reservoir,” adding that the project aligns with DHD’s strategy of investing in renewable energy to decrease dependence on fossil fuels, contribute to energy security, mitigate climate change, and promote environmental protection and sustainable socio-economic development. Hydropower reservoirs in southern Vietnam have vast solar power potential.
The financing package for the project includes a US$17.6 million loan from ADB’s ordinary capital resources, a blended concessional fund co-financed by the Canadian Climate Fund for the Private Sector in Asia and its follow-on fund, the Canadian Climate Fund for the Private Sector in Asia II, and a US$4.4 million parallel loan from the Leading Asia’s Private Infrastructure Fund (LEAP), supported by Japan International Cooperation Agency.
Singapore — Thailand’s Map Ta Phut phase 3 expansion has turned focus to Southeast Asia’s demand growth potential and future balancing role in global LNG, as oversupply concerns extend into the mid-2020s.
Thailand’s Gulf PTT Tank Consortium signed a 30-year contract with the Industrial Estate Authority of Thailand (IEAT) on Tuesday for the third phase of the Map Ta Phut LNG terminal, which would add 5 million mt/year of import capacity from 2025 before ramping up to 10.8 million mt/year.
Map Ta Phut, Thailand’s only LNG terminal, has a current capacity of 10 million mt/year and received 4.4 million mt in 2018, with S&P Global Platts Analytics forecasting the country’s consumption to rise to nearly 10 million mt/year by 2022.
Thailand is the biggest LNG consumer in Southeast Asia, followed by Singapore, Indonesia and Malaysia, while emerging buyers like Vietnam and the Philippines are also set to enter the market in the coming years as they seek reliable sources of energy to fuel their growing economies.
The growth potential of Southeast Asia, the world’s third most populous region and fastest growing LNG demand center, is so significant that the end of the forecast period of structural oversupply in the global market is likely, in part, to be determined by how quickly these new demand centers absorb the excess volume.
The region’s demand is set to more than double from 12.1 million mt in 2018 to more than 25 million mt/year by 2025, driven by upstream output declines, limited pipeline connectivity and growing consumption from the power and industrial sectors.
“Map Ta Phut’s expansion is a promising development in a market where the supply side of the equation is becoming increasingly more transparent while we are waiting for demand to show up on the other side,” said S&P Global Platts Analytics‘ Jeff Moore.
What is lagging behind are the subsequent long-term offtake agreements with suppliers, with more than 75% of liquefaction capacity that is expected to come online by 2025 not contracted to downstream demand sources.
“The next step will likely be for buyers who represent downstream demand to start to sign up for new offtake agreements,” Moore added.
Construction of the project is expected to be completed within three years, with operation scheduled to start in 2025 and total costs estimated at Baht 40.9 million ($1.3 billion).
The project is part of a larger Southeast Asian push for LNG infrastructure developments, on the back of booming gas demand in the region.
Australian company LNG Limited recently reached an agreement for its proposed Magnolia LNG export terminal in Louisiana to supply 2 million mt/year of LNG to support a gas-to-power project in Vietnam under a 20-year sale and purchase agreement.
Upcoming infrastructure projects in Southeast Asia will be key to help mop up the structural supply glut which has put Asian LNG prices under pressure.
Platts JKM, the daily benchmark price for spot deliveries to Northeast Asia, averaged $5.40/MMBtu over January-August 2019, down from $9.46/MMBtu over the same period in 2018.
Gulf Energy Development Public Company Limited and PTT Tank Terminal Company Limited own 70% and 30% of the shares in the Gulf PTT Tank consortium, respectively.
