How MGen’s RE focus could lead to MGreen IPO

By Ashley Erika O. Jose, Reporter

MERALCO PowerGen Corp. (MGen) President and Chief Executive Officer (CEO) Emmanuel V. Rubio is bullish on the company’s future, banking on its renewable energy (RE) projects to establish MGen as a powerhouse in the Philippines.

“The optimized market that’s running at the moment is enticing for investments,” Mr. Rubio said in an interview with BusinessWorld.

Mr. Rubio, who was appointed to lead MGen in July, said he is bullish on the company’s growth prospects and is banking on MGen’s projects, especially its renewable energy projects, to position the company as a powerhouse in the Philippines.

With nearly two decades of experience in the energy sector, Mr. Rubio has a strong background in the energy space, having served as former CEO of Aboitiz Power Corp.

“I have, of course, been exposed to the industry and been part of a number of associations within the industry. Hopefully, we will be able to contribute to some of the policies that are in place at the moment, being involved in the discussion to share insights on policies with the DoE (Department of Energy) and ERC (Energy Regulatory Commission),” Mr. Rubio said.

Incorporated in 2010, MGen is the power generation arm of Meralco, the listed power utility giant of the Pangilinan group.

MGen, through MGen Renewable Energy, Inc. (MGreen), controls SP New Energy Corp. (SPNEC), which Mr. Rubio said will put the company at the forefront of the renewable energy space.

SPNEC’s Terra Solar Philippines, Inc. is said to be the biggest renewable energy company, with projects consisting of a 3,500-megawatt solar power plant and a 4,000-megawatt-hour energy storage system. It is expected to generate more than five billion kilowatt-hours of electricity per year.

“Terra Solar is big. Right away, it is going to put us at the forefront of renewable energy. We will be the largest renewable energy company by the time it gets commissioned, with its first phase by 2026 and second phase by 2027,” he said.

IPO PROSPECTS
MGen is also seeing a growing market appetite for green companies, Mr. Rubio said, noting that MGen might potentially list its unit MGreen on the local bourse.

“There is nothing holding us back from considering listing MGreen. The matter is when and if we really need to. We are evaluating our options,” he said.

He said an initial public offering (IPO) for MGreen could happen sooner than five years.

To fully unlock energy security for the Philippines, Mr. Rubio said there is no one-size-fits-all solution and that energy companies should not be “technology agnostic” and must be open to emerging technologies.

“The reason why there is a portfolio is that each technology has a role to play, but one thing is clear, we really need to transition to clean technologies,” Mr. Rubio said.

MGen is interested in setting up energy storage systems to ensure the reliability of variable renewable energy projects, Mr. Rubio said, adding that it is also studying and evaluating energy technologies that are in the infancy stage in the country, like offshore wind projects.

“We are also looking at other opportunities, people that are offering partnerships with us in solar, and even offshore wind… We are really watching closely the development of energy storage. We are also looking at standalone batteries,” he said.

Manila Electric Co.’s (Meralco) majority owner, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls.