Philippine energy giant Citicore Renewable eyes Cambodia, Myanmar after Pertamina deal

[SINGAPORE] Philippines-listed Citicore Renewable Energy (CREC) is making its regional play while the sun shines, powered by a recent tie-up with Indonesia’s Pertamina that could spur future forays – and perhaps a secondary listing – in other South-east Asian markets.

President and chief executive Oliver Tan of the home-grown pure-play renewable energy developer and operator told The Business Times that Indonesia was the first step towards regional expansion.

“In particular, we are looking at potential opportunities to build solar (facilities) in Indonesia and export to Singapore to power its green-energy data centre demand… maybe in the next two years,” said Tan, who is Filipino.

CREC inked a US$120 million share subscription agreement with state-owned Pertamina’s new and renewable energy unit in June – a courtship that began some 15 months before a closing was reached, said Tan.

The Indonesian energy giant now holds a 20 per cent stake in the Philippine company, with its public float accounting for another 20 per cent and the remainder owned by parent company Citicore Power.

Asked which country could be next, the chief executive said: “Cambodia is exciting because of its strategic geographical location (in terms of the Asean power grid) and its land mass. Myanmar is also exciting.”

Comparatively, property in Thailand is expensive because of how the country markets itself as a tourist destination, and hence, building solar facilities there could be relatively difficult, he added.

Sun, sea, sky: Who’s the cash cow?

For now, CREC’s solar assets are all within the Philippines.

It boasts 10 operating utility-scale solar farms with a combined gross installed capacity of 285 megawatts across the three main island groups of the archipelago.

Seven plants lie in the largest northernmost cluster of Luzon; two are in the central cluster of Visayas; and the remaining one is in the southern island group of Mindanao.

Eight more utility-scale solar plants will be energised between now and December, which will bring CREC’s total solar capacity to about 1,300 megawatts by the end of the year, said Tan.

He added that the additional 1,000 megawatts CREC will switch on is backed by 20-year offtake contracts with the Philippine government, which derisks the project as a guaranteed buyer exists.

This development is also in line with CREC’s plan to build and energise 1,000 megawatts of solar power every year for the next five years.

Work has already begun on its second batch, noted the chief executive.

As for hydropower, CREC is currently developing a run-of-river facility targeted for completion three years from now.

Its wind assets are also under construction.

The group is developing four onshore wind power projects – comprising between seven and 40 turbines each – with a combined capacity of 360 megawatts. The smallest of the quartet is due for completion in end-2026.

Asked about CREC’s revenue breakdown, Tan said that, for the past three years, the group commanded a 20 per cent market share of total solar-generated power in the Philippines.

As at end-2024, 11 per cent of the power generated from CREC’s 10 operating utility-scale solar farms goes to the government and 84 per cent to commercial and industrial customers, he added.

The remainder goes to the Philippine Wholesale Electricity Spot Market – a centralised electricity-trading venue where prices are determined based on actual use (demand) and availability (supply).

CREC expects the government’s share to increase to 90 per cent by the beginning of 2026, as six of the additional eight solar plants under construction are committed to the authority’s Green Energy Auction Program.

In the bigger picture, CREC’s vision is to be able to provide round-the-clock, uninterrupted power supply from pure renewable energy – and the answer lies in energy storage systems, which will revolutionise the renewable energy sector, said Tan.

“We are about to switch on our first solar battery in end-July or early-August – that’s the first in the Philippines,” noted the chief executive.

“We’re already doing the testing, commissioning and all those protocols in order to dispatch electricity to the market. It’s in the final stages of construction, punchlisting and testing,” he said.

Growth drivers 

Tan told BT that national energy transition ambitions are a key growth driver for CREC.

The Philippines has set a target of increasing the share of renewable energy in its power generation mix to 35 per cent by 2030 and 50 per cent by 2040, and is actively promoting electric vehicle (EV) adoption.

“We’re still at an infant stage of EVs in the Philippines,” said Tan. “If there is a wide embrace of EVs, that will also drive power demand.”

The chief executive added that another new business segment with huge potential is agrosolar, which refers to the practice of growing crops or raising livestock underneath solar panels.

Noting that one megawatt capacity requires roughly 10,000 square metres of land, Tan said: “We have huge tracts of agricultural land on which we’re already doing pilots to plant crops.”

He continued: “We basically use the land two times to generate electricity and food. That’s going to be a big, big opportunity.”

Domestic growth engines apart, the Asean Power Grid is also another potential driver.

“It has been there for the last two or three decades, but now, it’s becoming more realistic, although the Philippines still has to address its main transmission backbone first,” admitted Tan.

Going beyond organic growth, there exists room for consolidation in the “really fragmented” domestic solar market, continued the chief executive.

“There are many small developers which we can acquire,” added Tan, who told BT that CREC was in the midst of reviewing three potential acquisitions, but noted that these were on a project basis.

He explained that in the Philippines, the only companies with a portfolio comprising many projects that are pure solar are Citicore, Acen and Meralco.

“The rest are really per project,” he continued. “So if you are to consolidate, you have to acquire on a per-project basis. You cannot acquire a company with many projects.”

Tan added that the current round of acquisitions are expected to be completed before year-end.

A country boy with a city dream

CREC listed on the Philippine Stock Exchange (PSE) mainboard in June 2024, raising some 5.3 billion Philippine pesos.

In the one-year span, its market capitalisation of 24.1 billion Philippine pesos at the time of listing almost doubled to 46.2 billion Philippine pesos (S$1.04 billion) as at Friday (Jul 25).

This is the third initial public offering Tan has taken to market since he joined Megawide Construction in 2009.

The mainboard-listed construction and infrastructure conglomerate is a sister company of Citicore Power, the parent company of CREC.

Megawide listed on the PSE in 2011, followed by Citicore Real Estate Investment Trust – sponsored by CREC – in 2022, and CREC itself in 2024.

On the listings, Tan said: “We have bold dreams, but we need capital to fuel our dreams.”

He added: “We’re country boys who came from the province (with) big dreams in a big city called Metro Manila – first generation, chasing our dreams.”

Asked about the likelihood of a secondary listing in Singapore, which Tan initially brought up in jest during the interview, the chief executive remained coy and replied: “That’s an option.”

He conceded that Singapore would align with CREC’s regional play, but maintained: “We’re considering. Our DNA – we’re dreamers. We dream big, which means when we look at things, all (options) can be considered.”