AC Energy Holdings Inc., the power arm of conglomerate Ayala Corp., expects higher earnings this year from the P2.7 billion it posted in 2016.
AC Energy President Eric Francia said the company’s 2016 income was “a little over 10 percent” in terms of contribution to parent firm Ayala Corp. In 2015 he said AC Energy incurred a net income of P2.1 billion.
This year the power firm is banking on more power assets that will hopefully result in improved earnings.
“This year we’re going to add more operating assets in our portfolio. The big one is Chevron in Indonesia. It has a very steady cash flow so that should definitely add to the earnings contribution,” Francia said when asked if the company would be able to sustain the growth.
Last year’s earnings was mainly driven by South Luzon Thermal Energy Corp.’s (SLTEC) Unit 2 coal plant. SLTEC is a joint venture of AC Energy and Phinma Energy Corp.
“We have more plants operating. We have SLTEC Unit 2. That was a big driver. It was primarily SLTEC Unit 2. That unit performed beyond expectations,” Francia said.
AC Energy reached 1,000 megawatts (MW) of attributable capacity in 2016. The company recently set a new target of reaching 2,000 MW of attributable capacity by 2020, of which 1,000 MW will be renewable energy (RE).
From a Philippine-focused energy-investment holding company, AC Energy is now transforming itself to become a regional-energy platform with investment, development, operations and retail capability.
“AC Energy is at a critical inflection point. Our transformation is enabled by rapid organic growth and key strategic acquisitions,” Francia said.
AC Energy recently acquired Bronzeoak Clean Energy (BCE) and San Carlos Clean Energy (SCCE), as the company ramps up its development and operations capability, especially in RE.
Bronzeoak Philippines group is one of the leading RE developers, having developed over 250 MW of solar and biomass projects.
SCCE and BCE have been renamed AC Energy DevCo and Visayas Renewables Co., respectively.
“Our newly integrated development platform is a critical element that will help AC Energy attain the goal of tripling its renewable-energy capacity to 1000MW by 2020,” Francia said. AC Energy, through a consortium with Star Energy and EGCO, earlier won the bid for Chevron’s geothermal assets and operations in Indonesia in December 2016. Immediately thereafter, AC Energy broke ground to start construction of a 75-MW Sidrap wind farm in Sulawesi, Indonesia, which is the country’s first commercial wind farm.
AC Energy plans to expand its presence in Indonesia beyond these two assets by working with existing partners to pursue expansion and greenfield projects.
“We started with Indonesia. We’re not going to stop with Indonesia,” said Francia. “We’re engaged in discussions on collaborating possible expansion.”
On another regional investment, Francia said Vietnam “could be the second.”
“Vietnam is something that we’re looking at. No specifics yet, we’re just studying the market for now.
While it will take time to strengthen our presence in Indonesia, we have started to look around Southeast Asia region and we hope to make our second regional investment in about 12-18 months,” Francia said.