The Ayala Group may build diesel power plants with a combined capacity of 550 megawatts in Luzon costing around P27 billion.
Documents submitted to the Department of Environment and Natural Resources showed that AC Energy Inc., the power unit of Ayala Corp., would develop a 150-MW diesel power plant in Mariveles, Bataan through Ingrid 2 Power Corp.
Ingrid 3 Power, a unit of AC Energy, is also building a 400-MW diesel power plant project in Calaca, Batangas.
The Mariveles power project is estimated to cost around P10 billion while the Calaca project would amount to P17 billion, based on documents.
The projects are being considered for mid-merit/load-following, peaking or ancillary service application.
Ancillary power plants help address sudden fluctuations in the frequency and the voltage of the transmission system while mid-merit and peaking/ load-following plants are operated with flexibility to respond to varying demand for electricity throughout the day.
AC Energy is also developing a 150-MW diesel power plant project in Pililla, Rizal which is expected to be operational next year.
AC Energy president and chief executive Eric Francia earlier said they were looking at investing in technologies to complement renewable energy such as battery energy storage and peaking plants.
“We believe the country will need more peaking and reserve, ancillary capacity…especially in a world where you inject more renewables,” Francia said.
Francia said that as more renewable energy was injected to the grid, there would be more intermittency in power, thus “you need ancillary for that.”
AC Energy issued US dollar-denominated senior perpetual fixed-for-life (non-deferrable) green bonds worth $300 million on Nov. 27.
“We are very pleased to see the high level of investor confidence in AC Energy and the strong market response to our perpetual green bond, following our maiden green bond in 2019. We believe that this will power AC Energy in its pursuit to scale up renewable investments in the region as we continue the transition to a low carbon portfolio,” Francia said in a statement.
AC Energy said it would use the net proceeds from the bonds to fund a tender offer and $400-million senior perpetual fixed-for-life notes callable in December 2022, and the balance to finance eligible green energy projects.
The bonds carry a fixed coupon of 5.1 percent. The issue represents the first Philippine fixed-for-life perpetual bond offering since November 2019 and the first public green bond out of the Philippines in 2020.
The company-guaranteed bonds were issued by AC Energy Finance International Ltd., a wholly-owned subsidiary, under a $2-billion medium term note program.
The bonds, listed on the Singapore Exchange Securities Trading Ltd., were certified as ASEAN Green Bonds by the Philippine Securities and Exchange Commission on Nov. 18.
“We are grateful to have been met with such a positive reception among bond investors especially given the pandemic. This underscores the continued confidence investors have in AC Energy’s ability to execute in this challenging environment,” said AC Energy chief finance officer Cora Dizon.
AC Energy said the Green Bond Framework sets out well-defined guidelines for the use of proceeds for renewable energy projects, with comprehensive monitoring and reporting commitments.