THE power units of Metro Pacific Investments Corp. (MPIC) will be expanding their capacity by around 1,600 megawatts (MW) until 2022, with plans to invest around P30 billion during the period.
“We continue to find ways to develop at least 1,500 megawatts of additional generational capacity by 2021. While we remain committed to clean coal, which today remains the most efficient to supply essential baseload demand, we are carefully evaluating renewable technologies,” MPIC President and Chief Executive Officer Jose Ma. K. Lim said in a speech during the company’s annual shareholder meeting in Bonifacio Global City, Taguig on Friday.
MPIC’s power units include Manila Electric Company (Meralco) and Global Business Power Corp. (GBP).
MPIC Chief Finance Officer David Nicol noted that half of this additional capacity will be attributable to Meralco, since the other half will be owned by partners. Estimating the required investment at $2 million per MW, the entire expansion could cost $3.2 billion.
“We have half of the project, we generally have a partner in all of them. So our share in the gross expense is $1.6 billion, and then from project financing, it should be be 70 to 30, so you’re looking at 30%, that’s around $500 to $600 million, so you’re looking up to P30 billion of cash out of Meralco,” Mr. Nicol told reporters after the shareholder meeting.
Mr. Lim noted that the group is still studying the appropriate mix for the added capacity.
“The developments in renewable are happening so quickly. We will try to find the right balance between coal-fired and renewable, taking into consideration the requirements of the country as well as the environment,” Mr. Lim told reporters in a separate interview after the meeting.
The executives noted that the current priority is the Atimonan power project that consists of two power plants producing 600MW each, for a total capacity of 1,200MW.
In addition to the capacity expansion, MPIC is currently in the process of developing a waste-to-energy facility in partnership with the local government unit of Quezon City. The project will have a capacity of 42 MW.
MPIC’s power units raised their consolidated core profit 16% in the first quarter of 2018, netting P3.6 billion in the January to March period. The listed conglomerate stepped up its investment in the power industry last year through Beacon Electric Asset Holdings, Inc., which in turn has a stake in both Meralco and GBP.
For the rest of the year, Mr. Lim said the group expects moderate earnings growth as the comparable periods will now include its increased investment in power.
MPIC is one of three key Philippine units of Hong-Kong based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT, Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls.
MPIC shares dropped 20 centavos or 3.92% to P4.90 on Friday. — Arra B. Francia