Corporate News

By Keith Richard Mariano

FPH will not invest in coal-fired power plants

Posted on May 24, 2016

FIRST PHILIPPINE Holdings Corp. (FPH) will never invest in coal-fired power plants, its top officials said, amid plans to further expand its renewable energy portfolio.

Federico R. Lopez -- BW FILE PHOTO
“Let me state unequivocally and for the record that FPH and its subsidiaries will not build, develop or invest in any coal-fired power plant,” its Chairman and Chief Executive Officer, Federico R. Lopez, said during a stockholders’ meeting in Pasig City on Monday.

“I’m certain that without having to look too far, this country already has energy alternatives that do not mortgage the future of our children and the future of our planet.”

The diversified conglomerate had considered investing and developing coal-fired power plants, Mr. Lopez told reporters on the sidelines of the stockholders’ meeting.

“In fact at some point we were studying it, we were going to invest in it. We even had plans that we announced. We’ve scrapped all of that already,” he said.

The Lopez-led company invests in power generation and energy-related sectors through First Gen Corp. The subsidiary accounts for 23% of the country’s gross generation and operates Energy Development Corp. (EDC), the world’s largest integrated geothermal power producer.

“In the coming years, as we scale up our operations, our only choice is to mindfully work together towards the common good,” FPH President Francis Giles B. Puno told the company’s stockholders.

“It is the reason we have prioritized investments in low-carbon sources of electricity coming from natural gas, hydro and geothermal. It is the reason why (we) have expanded the portfolio to include wind and solar.”

First Gen managed to dispatch the full capacity of its 150-megawatt Burgos Wind Project in Ilocos Norte last September. EDC, meanwhile, completed the 4.16-megawatt Burgos Solar Project in March 2015.

FPH can “easily” invest the same amount spent for the Burgos Wind to expand its wind power generation capacity, in particular, to 300 megawatts, Mr. Puno told reporters on the sidelines of the stockholders’ meeting.

“We would like to see that double over the next three to five years. (If we consider) the first investment of $450 million, then easily we can contemplate those kinds of amount for future projects.”

Mr. Puno, however, noted the government has yet to allocate feed-in tariff allowances, an additional payment that renewable energy producers receive as incentive.

“Madaming concession sa wind actually. But, unfortunately, wala pa ‘yung feed-in tariff. (There are many concessions for wind, but unfortunately, there is no feed-in tariff yet). As the government advances (the) additional allocation of feed-in tariff on wind, then we will be prepared to make more investments in wind.”

Asked whether the company will totally abandon fossil fuels, including natural gas, Mr. Lopez said: “I think we can do that but we’ve got to set a timetable for that and that will not happen overnight.”

First Gen currently has two natural gas-fired power plants: the 1,000-megawatt Santa Rita and 500-megawatt San Lorenzo. The company is also constructing the 97-megawatt Avion plant in Batangas.

“Natural gas is unique because per kilowatt, it only emits half the carbon of coal fired power plant. So, natural gas can be the bridge -- it can actually be a bridge to our renewable future,” Mr. Lopez said.

Mr. Lopez also called on the government to stop putting up more coal-fired plants and chart the country’s transition to renewable energy.

FPH closed 1.86% higher at P68.35 on the Philippine Stock Exchange on Monday.