SPC EYES RENEWABLES
Tough environment drives firm to seek niche markets, renewable energy Firm not giving up on Naga Power Plant Complex despite High Court’s decision
Listed firm SPC Power Corp. disclosed yesterday its interest to venture into renewable energy (RE) generation to remain competitive in the power industry.
Alfredo Henares, chairman of SPC Power Corp., described their outlook for this year as challenging, but he assured investors that they will continue to pursue businesses in coal-fired power plants, power barges, and biomass, hydro and geothermal power plants.
The implementation of the retail competition and open access is a game changer in the country’s power sector.
On the sidelines of the firm’s annual stockholders meeting, Henares said they will tailor-fit their products for niche markets, such as in the reserve market, instead of competing head-on against lowcost competitors.
“We are looking for markets where we can still get good returns and still provide good service to customers,” he said.
The company will also venture into RE generation, a new area for growth and investment.
“We are looking at renewables in hydro at the moment. In the past, we have looked at wind and solar,” he said. SPC is looking at locations outside the Visayas for its renewable projects.
SPC Power Corp. closed 2016 with a new record level of consolidated net income of P1.78 billion, up 18.4 percent from P1.51 billion in 2015 despite the setback on the Naga Power Plant Complex (NPPC).
“The strong performance across all business segments, coupled with gains made from cost containment measures, enabled the group to attain a new record year despite the generally low electricity spot market prices prevail- ing in 2016,” said Reynante del Rosario, SPC’s chief financial officer.
The Supreme Court (SC) denied with finality last November SPC’s urgent motion for reconsideration to raise to the en banc the court’s decision on the Naga power project. It reinstated the notice of award to Aboitiz Power Corp.’s subsidiary Therma Power Visayas Inc. for the 153.1-megawatt Naga power plant complex in Naga, Cebu.
Henares said they had already completed various feasibility studies from environment to engineering, economic and market studies and even issued invitations to bid.
“Everything was done. We were ready to bid when the SC came out with that order,” said Henares. He, however, said they still have two motions out for reconsideration.
Should the SC ruling still not favor SPC, Henares said, they will not be able to pursue building a 330 megawatt (expandable to 450 MW) plant in Naga City meant to provide additional power to the Visayas grid and lower electricity rates. “We are ready to build it,” said Henares.
“The net income contributed by power generation in the portfolio grew by a robust 69.8 percent to P551.2 million in 2016 from P324.6 million in 2015. The business unit benefited from higher utilization of available capacity and continuous implementation of cost-efficiency measures within the group operations that partly offset lower electricity spot market prices,” said Del Rosario.
Income from power distribution expanded 41.1 percent to P60.1 million, on the back of tariff adjustments approved by the Energy Regulatory Commission and new connections and existing customers adding to the load of the distribution business. /