AC Energy to fund building of Pampanga solar power facility

MANILA, Philippines — AC Energy Corp. will finance the construction of a solar power plant in Pampanga as part of the company's dream to become the biggest renewables producer in the region.

In a disclosure to the stock exchange on Friday, the power unit of the Ayala Group said ACE Endevor Inc. — a subsidiary — will lend P2.67 billion to Greencore Power Solutions 3 Inc. to construct a 50-MWac solar power facility in Arayat and Mexico Pampanga, north of the capital Manila. 

The project is a 50-50 joint venture between AC Energy and Citicore Solar Energy Corp. and was executed through a shareholders' agreement, wherein Greencore will act as the special purpose vehicle for the project. The plant is scheduled to begin operations in November this year.

Under the transaction, AC Energy and ACE Endevor will have a 45-percent and 5-percent stake in Greencore, respectively, while the remaining 50-percent shares will be owned by Citicore. The project is one of the two new solar plants cumulatively worth P6.1 billion that AC Energy plans to build in Central Luzon, which aim to generate a combined energy output of 150 megawatts (MW) by 2022.

The second power plant will be established in Palauig, Zambales.

"This joint venture supports the Company’s strategic objective to be the growth platform of the AC Energy Group in the country," AC Energy said.

"The Company will have the opportunity to develop a greenfield stand-alone solar farm, which will provide daytime power to the Luzon grid, in partnership with (Citicore)," it added

Under the deal, Citicore will be in-charge of engineering, procurement and construction services for the project. Once finished, the company will also handle plant operations and maintenance. In turn, AC Energy will earn from the project through dividend income from the operation of the solar power facility.

The Ayala Group is targeting to hike its renewables portfolio to 5,000 MW by 2025 in hopes of becoming Southeast Asia’s largest renewables platform by that year. That ambition is coupled with a vow to fully offload the conglomerate's investments in coal-fired power developments by 2030.

Apart from the Philippines, AC Energy has also identified Indonesia, Vietnam, Australia, India and Myanmar as key target markets where it can scale up its renewable energy expansion.

On Friday, shares in AC Energy gained 0.14% to close the week at P7.22 each.