The Philippine renewable energy industry has entered a “bull market cycle” that could last at least a decade as the country moves away from imported fossil fuel to foster energy security, the president of the soon-to-be-listed Citicore Renewable Energy Corp. said Thursday.
In an webinar hosted by First Metro Securities Brokerage Corp., Oliver Tan, who is also CREC’s chief executive officer, said the Philippine clean energy sector is just in its infancy given the economy’s increasing demand for energy and the need to replace fossil fuel-powered generating capacity.
The Department of Energy expects renewable energy to account for half the country’s generating capacity by 2040. Clean energy now supplies around 22 percent of the country’s electricity requirement.
Tan said CREC’s expectation of a boom in the clean energy industry only takes into consideration the replacement of existing capacity and the historically-low price of solar panels but not the growth in electricity consumption and the projected increase in the usage of the electric vehicles.
Solar panel price, he said, has fallen to around 11 US cents per watt from 90 US cents.
Asked how he projects CREC shares to perform once it lists on the Philippine Stock Exchange on 7 June, Tan said investors should not focus on the stock’s market performance but the growth of the company overtime.
He said revenue growth over the next five years will be driven by the substantial expansion of CREC’s generation capacity to around 5,000 megawatts.
CREC currently has 285 MW of generating capacity, which will increase by a total of 1,493 MW by the end of next year with the completion of eight solar farms it is now developing.
Aside from solar, CREC is also developing run-of-river hydroelectric projects and plans to build wind farms with a combined capacity of 3,100 MW.
“Hopefully our stock price will mirror the (financial) performance of the company,” Tan said.
Prior to the initial public offering of CREC, the shareholder group behind the company has already taken public Megawide Construction Corp. in 2011 and Citicore Energy REIT Corp. in 2022.
Tan is hopeful the post-IPO performance of Megawide and CREIT, which brought substantial returns to investors, would drive investor support for CREC.
After the IPO, Tan said the company plans to issue green bonds to generate additional funding for capacity expansion. The company also expects funds from CREIT once it transfers properties to the listed real estate investment trust, he said.
