AES commences Philippine generation expansion project

The AES Corporation has commenced development on the expansion of its Masinloc power generation facility. It would represent an infrastructure investment of up to $800 million.

The expansion project is expected to be funded with a combination of non-recourse financing and equity. Paul Hanrahan, AES President and CEO, recently met with Philippine President Benigno Simeon Aquino III and Energy Secretary Jose Rene Almendras to discuss AES' plan to double the size of its 660 MW Masinloc I coal-fired power plant.

"Based on our experience to date, the Philippine economy continues to show significant levels of growth which requires new low-cost electric generation capacity. Our Masinloc I facility was built in a way that included much of the critical infrastructure for the expansion unit, allowing us to provide one of the lowest cost alternatives for capacity expansion. We look forward to continuing our work within the Philippine power sector to help meet its growing demand for electricity," said Mr. Hanrahan.

Through its acquisition of the 660 MW Masinloc I facility in the Central Luzon region in 2008, AES became the largest foreign investor in the country's power sector. The Philippine economy is projected to grow at an average of over five percent year over year through 2015, with demand for electricity set to grow five percent through the same period. As a result of capital investment and operational improvements, AES increased Masinloc's capacity from 450 MW to 630 MW, improved availability from 50 percent to 74 percent and increased net production by 62 percent within two years. AES also improved the plant's environmental performance, lowering emissions levels so that they are in compliance with World Bank standards. The Masinloc II project would leverage the existing infrastructure, transmission interconnection and AES' operating experience in the Philippines.