AC Energy Holdings Inc. (AC Energy), a wholly owned subsidiary of Ayala Corp., has decided to shelve a solar power project in Davao del Sur and cut short the corporate term of PhilNewEnergy Inc. (PNE), which was supposed to build and operate the project.
In a disclosure to the Philippine Stock Exchange (PSE), Ayala Corp. said the move by AC Energy will still be subject to the required regulatory filings and approval.
PNE is AC Energy’s joint venture company with DGA PNE BV (DGA), a wholly owned subsidiary of Mitsubishi Corporation.
It was envisioned to construct, own and operate a solar power farm in Darong, Sta. Cruz,
Davao del Sur, but stockholders of the company have decided not to pursue the project anymore.
AC Energy Holdings Inc. president Eric Francia explained that civil works and electromechanical expenses remain high so they have decided to put off the solar project.
The move comes despite the significant reduction in the cost of solar panels.
Francia said the P9.68 per kilowatt-hour feed-in tariff (FIT) rate is not enough to compensate the investment in solar energy that will be required by the project.
FIT is an incentive given by the government to encourage investors develop renewable energy projects.