Environment: Net Zero by 2050
To date, ACEN has achieved 60 percent of its renewable energy capacity goal of 5,000 MW by 2025. We also have 18,000 MW in pipeline projects in various stages of development.
Last October, we announced our ambitious goal to become a Net Zero GHG emissions company by 2050. This is supported by our commitment to bring our generation capacity to 100 percent renewables by 2025.
Our E&S Policy paved the way to integrate sustainability in the way we work and influence our decision-making on strategy, capital allocation, operations, governance and culture with the aim to deliver long-term value for all our stakeholders. As part of these commitments, we implement the Environmental and Social Management System (ESMS) to manage Environmental and Social (E&S) risks and impacts throughout the life cycle of our projects. Through the ESMS, we are able to identify and assess E&S risks to develop appropriate action plans and mitigation measures.
While we develop clear metrics and targets to track and communicate our sustainability performance, just as we have for financial performance, we continue to drive company-wide support to Environmental, Social and Governance (ESG) standards and practices across the organization starting from the top management, permeating across the organization.
ACEN is working to establish an ESG platform or channel to communicate our approach and progress on ESG and the value it brings to our stakeholders.
The Energy Transition
ACEN is aligned with the global movement for climate action as to help secure the future from the threats brought about by climate change. We recognize the effects of climate change and the need for energy transition in order to limit carbon dioxide (C02) emissions while meeting the rising energy demand.
The AC Energy group’s sustainability journey started in 2016 when we shifted towards renewables and recalibrated our strategy and invested heavily in this space, specifically in solar, wind, and geothermal. That same year, we transitioned from a Philippine-based company to a regional one and rapidly grew our renewables portfolio across the Asia Pacific.
We have made tremendous progress toward our 2025 goal. Our renewable energy capacity has reached 3,300 MW and we have 18,000 MW in pipeline projects in various stages of development.
Through several well-received debt capital market issuances, ACEN and its parent AC Energy have both contributed to the country’s sustainable financing achievements.
AC Energy retains its place as one of the Philippines’ largest issuers of green bonds, with four tranches of outstanding green bonds, ranging from US$75 million to as large as US$400 million.
Most recently, in September 2021, our subsidiary ACEN Finance Limited issued its maiden green bond: senior guaranteed undated, fixed-for-life notes worth US$400 million. As a result, the fresh capital we raised in 2021 alone reached close to US$1 billion, which includes close to US$600 million from our stock rights offering, follow-on offering, and an investment from GIC’s Arran earlier that year.
ACEN recognizes that trees are vital in the fight against climate change and the critical role that business must play to safeguard biodiversity.
The protection and restoration of natural ecosystems will help mitigate climate risks and limit global warming to below 1.5°C while bringing additional environmental and social benefits, linked to studies cited by the International Panel on Climate Change.
We are committed to protecting and conserving biodiversity, maintaining ecosystem services, and adequately managing living natural resources throughout the life cycle of our power plants.
Since 2014, we have provided alternative sources of income to local communities. Our environmental program empowers locals through agro-forestry and reforestation, and the protection of biodiversity. As of 2021, we have established 1,275 hectares of forest protected and ~527,000 trees planted. This is equivalent to approximately 31,875 metric tons of carbon sink per year.* ACEN aims to plant 1 million trees by 2025 in locations where we have a presence.
We are also looking for ways to scale up and strengthen our environmental initiatives through collaboration and partnerships with sustainability organizations such as the World Business Council for Sustainable Development, Just Energy Transition for Inclusive Capitalism, Sustainability Council of the Ayala Group, local government agencies, Marine Wildlife Watch of the Philippines, and academes like UP Los Baños. We are also currently exploring Blue Carbon projects with the UP Marine Science Institute.
*Based on internal carbon capture estimate of 25 MT per hectare per year
ACEN creates opportunities to lower its environmental footprint through the reduction and recirculation of natural resources used throughout the life cycle of its power plants.
To address the large amount of plastic waste produced during solar plant construction, we are working toward making construction sites plastic waste-free by pioneering circular approach initiatives.
Through these efforts, plastic waste collected from solar module packaging is recycled into eco-bricks, which are used to build the solar plant facilities.
During the pilot phase of our circular approach solutions, more than 32,540 kg of plastic collected from our Alaminos solar plant, or the equivalent of about 25 compact size cars, was sent to our partner recycling facility, Green Antz.
In 2021, a total of 24,295 eco-bricks were used in the construction of our solar plant facilities. Such efforts helped limit the amount of plastic waste sent to landfill by diverting a further 3,280 kg.
Breathing new life into plastic waste
Nestled between our solar panels and Ayala Land’s Carbon Forest in Laguna is the tangible proof of the circular approach that we have pioneered in our 120 MW Alaminos Solar project. The 640 sqm. Alaminos Solar Control Building was built using 12,839 eco-casts upcycled from plastic waste from the plant’s solar panel packaging and from the nearby communities. The building serves as the Alaminos Solar team’s daily workplace. This is the first of many eco-brick buildings that ACEN plans to construct as it endeavors to implement the circular approach in more project sites while continuing to expand its renewables footprint.
ACEN aims to close the loop within its project locations, and help communities live in a pollution-free environment.
At present, ACEN proactively aligns with the best available practices on PV module waste management. We also partner with EPC contractors that are certified members of the PV Cycle Association, a global industry-based organization that provides businesses with sustainable waste management solutions aligned with the European Waste Shipment Regulation and the Basel Convention. The company adopts the PV Cycle system to ensure proper treatment measures are set in place to cover discarded end-of-life PV modules as well as modules damaged during transportation or installation. The PV Cycle is a voluntary mechanism to implement takeback and recycling programs for PV modules.
For wind projects, we develop decommissioning plans aligned with the regulatory requirements of the Department of Environmental and Natural Resources (DENR). The content of each decommissioning plan is tailor-made to address the structural specifications as well as the stakeholder concerns of each specific wind project. Possible interventions under the company’s decommissioning plans may include circular approaches to recycling or reusing wind turbine blades to the benefit of adjacent communities. As the activities of each plan shall be performed no less than 20 years from creation, the company will continue to monitor for best practices on wind turbine end-oflife management.
In Q1 2021, ACEN signed up as a supporter of the Task Force for Climate-Related Financial Disclosures (TCFD).
The TCFD was established by the Financial Stability Board to develop voluntary, consistent, climaterelated financial disclosures that would be useful to investors, lenders and insurance underwriters in understanding material climate risks. These disclosures revolve around four thematic areas: governance, strategy, risk management, and metrics and targets.
Water is an essential shared resource and vital to our operations. To address the water footprint of our corporate and suppliers’ sites, we aim to use water efficiently, transition from freshwater to alternative sources, discharge used water responsibly, and pursue water stewardship to keep watersheds healthy.
In 2021 ACEN’s Total Water Withdrawal reached 257,437,958.44 cubic meters while Total Water Consumption reached 180,984.21 cubic meters. Water Withdrawal was mainly driven by the cooling water system of SLTEC which draws and discharges seawater from Balayan Bay. To maintain the marine ecosystem, periodic testing for harmful substances is conducted in addition to water treatment and cooling prior to discharge.
In our solar plants, rain water harvesting systems have been installed to serve as an alternative water source for activities such as PV module cleaning and house load needs. These water harvesting systems can collect an average of 751,550 liters across four different solar plants. MonteSol and SacaSol have worked to reduce their water impact even further by utilizing automated cleaning machines. These machines clean the panels with more efficiency and less time. More importantly, they have reduced the amount of water utilized per cleaning cycle from an average of 480 cubic meters to only 69 cubic meters. Meanwhile, in Indonesia the Darajat Geothermal plant through our partner Star Energy, continuously optimizes water use by replacing surface water with condensate water for production and maintenance activities.
In the latter part of the year, with the devastating impact of Typhoon Odette (Rai) and the trail of destruction that it left across six regions in Visayas and Mindanao, ACEN, launched a series of relief efforts for the affected communities, including the installation of a water filtration system within its Negros plant to provide drinking water to the locals.