PRO-ENVIRONMENT financing companies have expressed their intention to invest in the $185-million geothermal facility of local renewable-energy (RE) firm Emerging Power Inc. (EPI) in Oriental Mindoro following President Aquino’s call for more investments in the RE sector to address the country’s power shortage.
EPI Chairman Martin Antonio G. Zamora said Mekong Brahmaputra Clean Development Fund (MBCDF), under management of the Dragon Capital Group, and the Netherlands Development Finance Co. (FMO) are advocates of sustainable-development projects.
He said 30 percent of the total investment would be direct equity and 70- percent debt financing sourced from Philippine banks.
In line with this, Dragon Capital’s MBCDF and FMO are looking to invest around 15 percent in equity.
“The entry of our pro-environment investors is in sync with the President’s call for renewable-energy companies like EPI to help solve the power problem without harming the environment,” Zamora said.
Zamora said EPI’s 40-megawatt geothermal project in Naujan, Oriental Mindoro—which is set to start its drilling phase next month—will help stabilize power supply in the archipelago; bring down electricity costs; and uplift the economic conditions of the people in Mindoro without harming the ecological balance in the island province.
“The geothermal project is expected to result in as much as P2.1 billion in savings [or by 40 percent from P11-per kilowatt-hour to P6.58 per kWh] in electricity bills the people of Mindoro will pay in four years’ time,” Zamora said, adding that with geothermal, the people of Mindoro could be assured of a sustained, low-priced power as opposed to the cost of power derived from fossil fuel such as coal.
“The MBCDF is proud to be making its first investment in the Philippines with a highly reputable renewable-energy company like EPI.
The MBCDF engages in clean development investments that meet the ‘Triple Bottom Line’ principles of ‘People, Planet and Profit.’
These are sustainability values that demand a specific, measurable criteria for every investment’s positive impact on the environment and society as a whole,” said Joseph Hoess, Dragon Capital director.
House Energy Committee Chairman and Oriental Mindoro Rep. Reynaldo Umali welcomed EPI’s project, saying: “We are happy that Dragon Capital and FMO share our vision of bringing in progress and development without disturbing the ecological balance that this virgin-forested island is known for.”
EPI, which is responsible for the exploration and development of the geothermal project, has tapped the expertise of the Geo-Survey Institute of Iceland and the Institut Teknologi Bandung of Indonesia.
FMO is an entrepreneurial-development bank of the Netherlands. The bank invests risk capital in companies in developing countries.
With a committed investment portfolio of €6.6 billion in 2013, FMO is among the largest public-private development banks worldwide.
MBCDF is a limited partnership established in Guernsey focused on the development and deployment of clean Technology to promote economic growth in Asia. It is managed by Dragon Capital Clean Development Ltd., a subsidiary of the Dragon Capital Group, an integrated investment group centered in Vietnam with over $1.4 billion of assets under management.
President Aquino earlier said more investments in clean and RE would not only address the looming power shortage next year but would also make sure the economy would not lose momentum.
“It is of absolute importance that we continue exploring and investing in clean and renewable energy sources,” Mr. Aquino said in his speech at the recently held Energy Smart Philippines 2014, which was organized by the European Chamber of Commerce in the Philippines and the World Bank’s International Finance Corp.