Ayala-led AC Energy Holdings Inc. has forged an agreement with A Brown Inc. to put up a 135-megawatt coal-fired power plant in Iloilo, which is estimated to cost P12.5 billion.
The memorandum of agreement covering the construction of the proposed clean coal facility was signed by the Ayala subsidiary, and A Brown and its subsidiaries—Palm Thermal Consolidated Holdings Corp. (PTCHC); Palm Concepcion Power Corp. (PCPC) and Panay Consolidated Land Holdings Corp. (PCLHC).
In a disclosure to the Philippine Stock Exchange on Thursday, A Brown said the proposed greenfield coal-fired facility, which is targeted to start commercial operations by 2015, would help address the expected tight power supply situation in Panay and the Visayas grids by 2015.
Should further capacity be needed in Iloilo, AC Energy and A Brown have agreed to include in their plan a second 135-MW power plant for future development.
“With the joint venture in place, the power plant is now on track to breaking ground within the fourth quarter of 2012. The corporation has done all the preliminary work and investments over the past two years. The engineering plans are ready, and important regulatory approvals have been secured,” A Brown said.
The Ayala Group has been aggressively beefing up its power-generation portfolio with plans to embark on $2.5 billion worth of power projects and build a portfolio of about 1,000 megawatts over the next five years, through partnerships with more experienced power players.
“This is a welcome development for Panay, in particular, and the Visayas, in general, as this will ensure the availability of steady, reliable and cheaper power to fuel anticipated growth and development in key areas like Iloilo City, Bacolod City and Boracay. Our commitment to Panay is long-term, as we stand ready to build another 135MW of capacity if there is a need for it,” said A Brown vice president Roel Castro.