AYALA-LED power generation firm AC Energy Philippines said the new coronavirus disease 2019 (COVID-19) pandemic has led to a 30 to 40 percent decline offtake volumes and dragged its power projects.
“The COVID-19 pandemic has had a significant impact on the company’s business environment. In Luzon, we have seen between 30 to 40 percent decline in the demand for power because industries and commercial business are on hold. This has resulted in some reduction in AC Energy Philippines’ offtake volumes,” said Eric Francia, AC Energy president and chief executive officer.
Francia said at AC Energy’s virtual stockholders meeting yesterday
the company’s commercial operations team is working closely with its customers and suppliers to make sure it maintains a balanced portfolio in terms of energy supplied and energy delivered.
Most of the company’s plants are under bilateral contracts or feed-in-tariff arrangements.
Francia said projects under construction will face “inevitable delays” as work restrictions on sites were experienced due to the quarantine but development teams continue with the planning, engineering and permitting works to maximize timelines.
But Francia said the current low oil price regime can benefit the company.
“Low oil price bodes well for renewables and the company. Renewables still require battery storage or peaking and ancillary power plants such as gas or diesel plants to make renewables dispatchable or reliable… Given today’s low oil price, our peaking plants are now in a very good position to provide cost efficient peaking power supply and ancillary services to the grid,” he said.
AC Energy currently has 224 megawatts (MW) of diesel peaking plants in operation and another 150 MW under construction.
At the briefing, Francia reiterated the company will focus on renewable energy investments and remains open to other thermal technology such as natural gas and diesel-fired power plants.
He said AC Energy is looking at whether or not it is feasible to transition the 2×135 MW South Luzon Thermal Energy Corp. coal plant to use biomass feedstock instead.
In a disclosure, AC Energy’s mother company, Ayala Corp., announced the consolidation of its energy, water and infrastructure businesses under its wholly owned subsidiary AC Energy Inc. which will be renamed as AC Energy and Infrastructure Corp.
The conglomerate said this will streamline business and reconstitute and transform the current AC Energy, Inc.
Based on equity interest in power generation businesses, the entire AC Energy Group already owns approximately 1.7 gigawatts (GW) of generation capacity in operations and under construction as it aspires to exceed 5 GW of attributable capacity and generate at least fifty percent of energy from renewables by 2025.
