IPO bound solar firm ramps up capacity

MANILA, Philippines — Raslag Corp., the IPO-bound solar company owned by the Nepomuceno family of Pampanga, plans to ramp up its generation capacity to 250 megawatt-peak (MWp) in the next 10 years, its top official said.

Raslag, a pioneer in the country’s grid-scale solar energy development, already has two operating power plants – the 10.046 MWp Raslag-1 and the 13.141 MWp Raslag-2. Both plants were included in the government’s feed-in-tariff (FIT) system, which guarantees a fixed price for renewable energy players in the country for 20 years.

Raslag-1 has a P9.68 per kilowatt-hour base tariff, while Raslag-2 has an P8.69 per kwh base tariff, essentially guaranteeing payment from the government with annual adjustments for inflation and foreign exchange.

“These assured payments are expected to give Raslag a total of at least P300 million in gross annual sales and annual net income of approximately P100 million for the next 20 years,” the company said in its prospectus for its planned P700-million initial public offering (IPO), which is targeted for listing on April 21.

The IPO consists of 350 million common shares at an offer price of up to P2 per share, plus an over-allotment option of up to 52.5 million common shares.

The company engaged China Bank Capital Corp. as the sole issue manager, underwriter and bookrunner for the IPO.

In an interview with The STAR, Raslag chairman Peter Nepomuceno said the company is already gearing to start the commercial operations of its third solar project, the 18.011 MWp Raslag-3, by May 2022.

Raslag is also in the advanced stages of land acquisition, permitting, and development work for its eventual largest plant, the 35.159 MWp Pampanga Solar Power Project Phase IV or Raslag-4.

Construction is targeted to commence in the second quarter of 2023 and is expected to follow a similar eight-month timetable before achieving commercial operations status in March 2024, Nepomuceno said.

The company also plans to build an approximately 60-megawatt solar plant on a 44-hectare land located at Panipuan, Mexico, Pampanga, to be known as Raslag-5, within the next five years.

These projects will expand Raslag’s total generation capacity to 136.4 MWp or by nearly six-fold.

Nepomuceno is optimistic on the company’s prospects, especially with demand for renewables, such as solar energy, growing worldwide. He also said that the price of solar, unlike fuel, would remain stable.

“The advantage of the price of sunlight is that it will never go up, but the prices of coal and bunker fuel are going up now,” he said.

Juan Paolo Colet, director and head of execution at China Bank Capital, also noted Raslag’s strong record of being able to execute their plans within record time.

This, he said, is something that can be replicated for future projects.

“What is unique about Raslag is that it has two operating assets already and it has a clear path to scale up their operations,” he said.

Colet also noted the growing interest in solar, especially institutions who have allocated funds for ESG (environmental, social, governance) investments.