The Aboitiz Group-led consortium has won the P36.27 billion privatization bid for the 796.56 megawatts (MW) Caliraya-Botocan-Kalayaan (CBK) hydroelectric power plants, Laguna’s biggest hydropower, sealing the group’s lead position in the renewable energy segment, analysts said.
Peter Garnace, research analyst at Unicapital Securities Inc., said this “marks a strategic milestone (in) significantly expanding its hydroelectric portfolio” and overall RE energy mix.
“The CBK hydropower complex is the oldest and the largest government-owned hydropower plant, accounting for over 4 percent of the Luzon grid, a critical asset in ensuring grid-wide stability and energy security,” Garnace said.
He added that this acquisition “cements Aboitiz Power’s position as the largest hydropower operator in the Philippines.”
On Friday, July 4, the Aboitiz-led consortium of Aboitiz Renewables Inc. (ARI) – the Aboitiz Power Corp.’s RE portfolio holding company, with Sumitomo Corp. and Electric Power Development Co. known as the Thunder Consortium, posted the highest bid of P36.27 billion for the privatization of the CBK. The bidding was conducted by the Power Sector Assets and Liabilities Management Corp. (PSALM).
Garnace said that while they do not know the exact ownership structure of Thunder Consortium, they think the acquisition is “earnings accretive” for Aboitiz Power because of its “strong potential to drive sustainable earnings growth in the coming years.”
Meanwhile, Rizal Commercial Banking Corp. chief economist Michael Ricafort said that “given limited readily available and relatively larger hydropower facilities in the country; instead of starting one that would take many years to complete alongside a lot of requirements when starting from scratch.”
He also said that this will drive Aboitiz Power’s RE push since “hydropower is one of the cheapest RE per kilowatt hour.”
Aboitiz Power as a group plans to expand its energy mix by adding 3,600 MW of new RE capacity for a total of 4,600 MW RE power by 2030. This brings the total, including thermal power plants, to about 9,200 MW in five years.
Thunder Consortium won over rival Lopez Group’s First Gen Prime Energy Corp. and Korea Water Resources Corp.
PSALM said Thunder Consortium will still conduct “a rigorous post-qualification process” to verify the accuracy and authenticity of the documents submitted.
