AC Energy Philippines (ACEPH), the power arm of conglomerate Ayala Corp., is expected to post profit this year despite the low demand for power caused by the coronavirus disease 2019 (Covid-19) pandemic.
From a net loss of P417 million in 2019, ACEPH President Eric Francia said during the company’s annual meeting Monday that they “expect the turnaround initiative to prosper and are aiming for a positive bottom line by 2020.”
The company’s power generation portfolio has increased from 416 megawatts to over 1,100MW. The additional 684MW of new capacity has been added to the company’s portfolio, of which 60 percent was from renewable sources.
The additional capacity came from a combination of infusion of generation assets from AC Energy parent (176MW); acquisition of brownfield power generation assets (196MW); and starting the construction of new power projects (330MW).
This year, ACEPH is targeting over 1,500MW of power generation capacity.
“While we are facing significant challenges amid the current crisis, the Company remains solid and steadfast in its commitment to a sustainable future. We will continue to expand and diversify our generation capacity and will target to exceed 1,500MW of capacity by 2020 and significantly increase our renewables capacity.
We will also enhance the operating efficiencies especially of our thermal power plants, where we aim to improve availability by over 20 percent,” said Francia.
The company has also decided to put a stop to investing in coal power business in the future, but it remains open to thermal technology, such as gas or diesel-fired power plants that complement its renewable assets and developments.
“ACEPH will now focus on renewable investments and we will not be making additional investments in coal plants.The company will also explore whether it is feasible to transition SLTEC [South Luzon Thermal Energy Corp.] feedstock to biomass.
It is also open to bringing in a partner and reducing its stake in the coal plant consistent with the company’s transition to a low carbon portfolio and coal divestment by 2030,” said Francia.
The company is currently experiencing a 30-percent to 40-percent drop in demand for power as industries and commercial business are on hold. The Covid-19 pandemic also resulted in delays in power project construction.
“Covid pandemic has had a significant impact on the company’s business environment. In Luzon, we have seen between 30-40 percet decline in the demand for power. This has resulted in some reduction in ACEPH’s off-take volumes.
In terms of projects under construction, there have been some inevitable delays due to restrictions on working onsite due to the quarantine. However, our development teams continue with planning, engineering and permitting works to maximize timelines,” said Francia.
Source: Business Mirror