MERALCO POWERGEN Corp. (MGen) said on Sunday that its solar energy project in Bulacan has signed an engineering, procurement and construction (EPC) contract for its P4.25-billion solar farm in Bulacan, marking the company’s foray into renewable energy.
In a statement, the power generation arm of distribution utility Manila Electric Co. (Meralco) said PowerSource First Bulacan Solar, Inc. (PFBSI) signed the contract on Friday with SUMEC Complete Equipment & Engineering Co. Ltd.
MGen unit MGEN Renewable Energy, Inc. (MGreen) holds a 40% interest in PFBSI. The other shareholders are PowerSource Global Holdings Corp. with a 36% stake, and Singapore’s Sunseap International Pte. Ltd. with 24%.
The contract paves the way for the construction of PFBSI’s 50-megawatt (MW) alternating current solar plant in San Miguel, Bulacan. The project will sell energy to Meralco under an approved power supply agreement.
“We are committed to undertake 1,000 MW of renewable energy projects in the next five to seven years. This start is one of the lego pieces that will make a thousand,” said MGen President and Chief Executive Officer Rogelio L. Singson.
The solar project is the first announced project under MGreen, which MGen said “plans to develop large-scale solar, wind and hydropower projects that will provide reliable, environment friendly power at competitive prices without the need for subsidy.”
The EPC for contract signing for PFBSI comes less than a week after MGen formally inaugurated the P56.2-billion San Buenaventura Power Ltd. Co. (SBPL), the country’s first supercritical coal-fired power plant, which now provides additional supply to the Luzon grid.
The 500-MW SBPL started commercial operations on Sept. 26, and currently generates power for Luzon, which accounts for about 72% of the country’s domestic product, it said. The plant’s cost was partly funded by a P42.15-billion project finance facility, which is said to be the Philippines’ largest all-peso transaction to date. A consortium of local banks put together the facility.
Earlier this month, Meralco’s board of directors approved the request of MGreen for a P424.2-million equity funding for its solar projects under development with a combined capacity of 210-MW peak and a total estimated project cost of P10.01 billion.
MGreen was established to serve as the platform for the strategic push to develop renewable energy projects, primarily solar, wind and run-of-river hydro.
Besides advancing renewable energy prospects, its parent MGen is also focused on utilizing high efficiency, low emissions (HELE) technology for baseload power plants.
Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT, Inc.
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