Two companies of Meralco PowerGen Corp., a unit of Manila Electric Co., plan to raise close to P100 billion this year to fund the construction of two separate coal-fired power plants in Luzon.
Meralco president Oscar Reyes told reporters Tuesday at the sidelines of the stockholders’ meeting of the parent firm the two units would raise financing for 70 percent of the project cost, with the balance to be funded by equity from the project partners.
“RPE will be higher than P40 billion, because it’s 600 [megawatts], while the other one [San Buenaventura] is 455 MW. So it will be bigger… So short of P100 billion,” he said.
Meralco PowerGen owns majority of San Buenaventura Power Ltd. Co., the developer of the 455-MW coal plant in Mauban, Quezon. San Buenaventura is planws to raise P40 billion or 70 percent of the project cost.
Meralco PowerGen is also the majority owner of Redondo Peninsula Energy Inc., the developer of the 600-MW coal-fired power plant at the Subic Bay Freeport Zone.
Reyes said RP Energy would need financing of over P40 billion. He said RP Energy would likely tap the local banking community to raise the funds.
Reyes said the two Meralco units planned to complete the financing this year.
“Yes, in order to meet the timetables of the country’s demand,” he said.
Meralco PowerGen hopes to complete the San Buenaventura project by late 2018 and the Subic power station by early 2019, if not earlier.
The official added banks “would like to lend when there’s an assured market, when the cost of the project has been defined… and whether there is clarity on the interconnection.”
ERC recently approved the 20-year power supply agreement of Meralco and San Buenaventura, assuring the power plant of an offtaker for its entire 455-MW output.
RP Energy, meanwhile, vowed to proceed with the construction of Subic coal plant following the favorable ruling of the Supreme Court.