Jaime Augusto Zobel de Ayala, chairman and CEO of Ayala Corp., speaks during the Belt and Road Summit in Hong Kong on Sept. 11, 2017. (Photo: Vivek Prakash/Bloomberg)
AC Energy, a subsidiary of Philippine conglomerate Ayala Corp., has pledged to use technology to improve lives and ensure a sustainable future for all. It recently announced a deal in Vietnam to build out 80 megawatts of solar electricity generation capacity, in advance of Vietnam’s June 2019 feed-in-tariff change. This is the latest in a string of deals for AC Energy, which plans to develop 5 GW of attributable capacity by 2025, half of which will come from renewable energy, requiring an investment of around $2 billion of equity.
AC Energy is expanding beyond the Philippines, and has identified Indonesia and Vietnam as key target markets with expansion plans that will complement existing renewables projects in its home country. The company’s climate-friendly transition is aided by more favorable regional policies toward renewable energy, according to AC Energy’s website.
Earlier this year, I profiled Nguy Thi Khan, one of the founders of Vietnam’s Green Innovation and Development Centre (GreenID), who won the prestigious Goldman Environmental Prize for demonstrating the viability of sustainable energy solutions for Vietnam. As a result of her work, the Vietnamese government shifted its plans to include more renewable energy in the future. Vietnam’s current feed-in-tariff of $0.095 per kilowatt hour is quite generous.
Much of the cash for AC Energy’s renewables build-out comes from ongoing sales of its coal-fired assets. It sold roughly 35% of its coal-fired capacity to AboitizPower, another Philippine power industry giant, in a deal announced on Sept. 26, for a reported $579.2 million (P31.4 billion), one of the largest regional power transactions in several years. AboitizPower is purchasing equity in two coal-fired plant partnerships, GNPower Mariveles and GNPower Dinginin. (Erramon I. Aboitiz, the chairman of AboitizPower, is a member of Asia Business Council, where I am adjunct fellow). After the sale, AC Energy retains 51% of voting shares on both assets. AC Energy’s post-sale generation mix stands at 800 megawatts of thermal energy capacity and 400 megawatts of renewables.
AC Energy President and CEO Eric T. Francia noted the need to scale up the company’s renewables if they are to meet their 2025 goal. “While we will continue to develop projects in the Philippines, a lot of that incremental growth in renewables will have to come through international expansion,” he said.
