The Department of Energy (DoE) will evaluate the potential impact of the proposed $5-billion acquisition of Energy Development Corp. (EDC), the country’s largest geothermal power producer, if the transaction goes through.
THE Department of Energy (DoE) said it will assess the potential impact of the proposed $5-billion (about P308 billion) acquisition of Energy Development Corp. (EDC), the country’s largest geothermal power producer, if the transaction pushes through.
The agency has yet to receive formal notice of the proposed deal, but Energy Secretary Sharon S. Garin said it would evaluate any implications for the country’s power supply. The comments came after First Gen Corp. disclosed that it had received an unsolicited, non-binding $5-billion offer from Indonesia’s PT Barito Renewables Energy (BREN) to acquire its renewable energy subsidiary, EDC.
EDC accounts for about one-fifth of the Philippines’ installed renewable energy capacity, with most of its capacity coming from geothermal power plants in the Visayas and Mindanao.
"But if it does come to that, the DoE’s role is to ensure that our supply is not affected, and that the owner, if the deal pushes through, will follow the DoE’s energy plan to advance more geothermal and renewable energy," Ms. Garin said in an interview last week. While First Gen has yet to decide on the offer, Ms. Garin said BREN’s acquisition of EDC would be "a welcome change" if it brings more investment into the geothermal sector.
"As long as they comply with all the legal requirements, since there might be questions about that," she said. "But I think if this can encourage more investments, why not — especially in geothermal, which we really need to expand further. " BREN is the renewable energy arm of Indonesian conglomerate PT Barito Pacific Tbk. It holds a majority stake in Star Energy Geothermal, Indonesia’s largest geothermal producer.
The Philippines has an installed geothermal capacity of 1,952 megawatts (MW), making it the world’s third-largest geothermal power producer after the United States and Indonesia. The Economy and Development Council recently approved a P10-billion geothermal resource de-risking facility to reduce the risks associated with geothermal project development. Geothermal energy provides baseload power, although exploration requires significant upfront investment before a resource can be confirmed as commercially viable
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