SMC power unit allots P133B for capital projects

SMC Global Power Holdings, Corp. (SMCGP) said Tuesday over P133 billion has been authorized for capital projects but the amount has yet to be disbursed.

“The outstanding purchase commitments of the Group amounted to P134,750,238 (P134.75 billion) as at June 30, 2022. Amount authorized but not yet disbursed for capital projects is approximately P133,667,802 (P133.67 billion) as at June 30, 2022,” the power arm of conglomerate San Miguel Corp. said in a filing with the Philippine Dealing and Exchange Corp.

It said funding will come from available cash and proceeds from outstanding long-term and issued Senior Perpetual Capital Securities.

“The group’s material commitments for capital expenditure projects involve the construction of power plants, mostly utilizing high efficiency low emission technologies, LNG [liquefied natural gas] and BESS [battery energy storage system] in line with the Group’s expansion projects and acquisition of fixed assets needed for normal operations of the business,” it said.

SMCGP has completed the set up of 500 megawatt hour (MWh) of installed power storage capacity coming from new BESS facilities it is putting up nationwide.

By the end of this year, SMCGP expects to bring total battery capacity to 700 MWh, and 1,000 MWh by the end of 2023, once all 32 BESS facilities come online. This is the very first and largest battery network in the Philippines by far.

The BESS network will be key to ensuring reliable power supply nationwide, even in far-off areas. It is designed to minimize wastage by storing and redistributing excess capacity to ensure even underserved regions can have the same sufficient, reliable electricity enjoyed by larger cities.

SMCGP’s BESS facilities are also crucial to wider use of renewable energy in the country. Currently, the main challenge of renewables is intermittence, or the unreliable nature of renewable sources such as wind, solar, and hydropower. Battery technology will enable renewable capacity to be stored, ready to be deployed even when solar or wind farms or hydropower plants are down.

SMCGP, which previously said it would no longer pursue new coal power investments, is also planning to increase capacities coming from cleaner fuel sources as well as renewables.

It is investing in new LNG plants, utilized by developed countries as a cleaner “bridge” fuel that facilitates an exit from coal, and transition to renewables. It is also putting up additional solar and hydropower plants.

Image credits: SMC Global Power