Meralco ramps up 2014 capex
Hong Kong–Manila Electric Company (Meralco) is ramping up its capital expenditures next year to P15.6 billion, from the P13.5 billion it announced last month, due to the rapid growth in demand from the business sector.
In an interview, Meralco president Oscar Reyes said the firm normally sets an annual capex of around P10 billion citing the P10.3 budget in 2012 and the P10.8 billion estimate for this year.
However, Reyes said this will spike in 2014 as Meralco will have to make very heavy investments due to the growth in the number of accounts and end-user volume.
“Well you got new projects such as the PAGCOR city. I think with the development. Solaire is already there and three others; Tiger, Belle Corporation and Travellers; they’re all coming online in 2014 and 2015. So that’s quite a significant development,” Reyes explained.
He added that industrial estates are running out of space and are expanding to accommodate new locators as well as by developing new industrial parks. Reyes said these need adequate power of excellent quality. Also contributing to the expected spike in demand is the business process outsourcing sector which continues to be strong.
“In fact we’ve been approached just to ensure supply and quality. Because some of the BPO companies have the options of China and other places. They say they’d like to do it here in the Philippines but power is critical and they want to be assured of adequate power with excellent quality, no voltage fluctuation. Sp if power can be assured then the Philippines would be okay,” Reyes added.
Reyes said the P15.6 billion capex is limited to the expansion of the company’s distribution business alone, with the expansion of its other ventures like the power generation being eyed in the Philippines and Singapore, requiring additional capital.
Reyes said the company is encouraged by the continued growth of the business in the Philippines that after securing two opportunities overseas – power generation in Singapore, and distribution in Nigeria – they intend to revert focus in the Philippines.