DUE TO CLIMATE CHANGE,
THE ONLY PLACE HOTTER IN
THE SUMMER IS HELL.
It will only get worse.
This is why we need to act now.
Sunflowers grow and even thrive in direct sunshine and warmer climates. They are known to be a hardy plant that can survive extreme heat. However, the optimal temperature for growing them is about 25 degrees Celsius. Soon, the world might be too hot, even for sunflowers.
In 2016, we set ourselves on a green path with the decision to forego traditional energy investments and pursue clean, low-carbon, renewable energy.
“Real and lasting shareholder value can only be had when we place the interests of all our stakeholders, our customers, the planet, and humanity at the center of everything we do.”
Federico R. Lopez, EDC Chairman
“While renewable energy is often seen as an alternative, EDC believes it is possible to mainstream clean energy. Renewable energy is not only an environmentally-responsible choice, but a wise business decision as well. EDC’s experience demonstrates this, and we hope to convince even the doubters that the future of energy is renewable.”
Richard B. Tantoco, EDC President and CEO
4 THINGS TO KNOW ABOUT YOUR INVESTMENT IN EDC
1. We continue to make wise decisions that allow us to improve operations and grow our business
The Energy Development Corporation (EDC) has recorded steady and reliable income for the past three years, despite challenges.
2. Our commitment to sustainability is also a commitment to share value.
We continue to make innovations to enhance our sustainability performance. This year we begin to explore the transition to Integrated Reporting, to allow us to better communicate how we use our resources in order to create and share value
Sustainability is in our DNA: we are now on our 9th of sustainability reporting.
3. EDC is prepared for a future with greater risk.
We have stepped up our efforts to build resilience into our business. Our commitment to make our assets more resilient and our operations more efficient, and thereby more competitive, so that we are better able to produce clean, reliable, renewable energy – particularly geothermal energy.
Investing in Resilience
In 2017, after our facilities in Leyte experienced setbacks due to natural calamities, we focused on our planned investments to strengthen the resilience of our business operations in the face of unpredictable weather changes and other natural hazards.
Efficient project management allowed our Leyte facilities to return to service ahead of schedule. This, in turn, translated into an additional power generation of 402 GWh. These planned investments also supported facility improvements that increased our operational efficiency. As such, the completion of these key activities in 2018 resulted in a 1% increase in our overall power generation, at 7,568 GWh, versus our original target of 7,504 GWh.
Given that our power plants are located in areas vulnerable to landslides and typhoons, we invested over PhP313.8 million for 31 mitigation projects that will improve the resilience of our facilities in Negros, Leyte, and Bicol. This translates to over PhP4.7 billion value of risk mitigated.
Excellent project management also pushed our Preventive Maintenance System (PMS) activities to be completed ahead of schedule. This is in contrast to the prior track record of projects requiring additional days of up to 60% before being completed. This new “business as usual” resulted in avoided losses due to extensions, and brought in additional revenues worth PhP290.4 million.
Despite our efficient project management, some facilities still experienced a few complications in 2018. In our Leyte facilities, outages in Mahanagdong and Upper Mahiao resulted in a 5.8% unplanned outage factor, an increase from our 2% target.
Investigations into the tripping in Mahanagdong traced the problem back to defective work provided by a contractor. As such, the key lesson here is for EDC to select the right contractors with strong capabilities for a required service. Other emergent issues in our Leyte facilities also resulted in opportunity loss of about PhP45 million. This will be an area of continuous focus and improvement in 2019 and beyond.
In 2018, prudent planning and proper management of costs enabled EDC to effectively maintain its strong financial position, bolstered by the excellent performance of its individual business units.
4. The future is bright.
The outlook for clean energy is positive and demand is growing. Many companies are now mandating the purchase of green energy in their procurement practices.
We are confident that our business will continue to grow, especially as more people understand the importance of making better and cleaner energy choices.
The increasing number of companies making the switch to renewable energy is proof that, not only is it the smart choice for the climate and the environment, it is also a wise business investment.
As the leading renewable energy provider in the Philippines, EDC is in a position to help companies make the transition to clean and renewable energy. Beyond being a service provider, we also enable our clients and customers to make changes that will benefit not only their business operations, but also the environment.
In 2018, we grew our customer base, in terms of customer facilities, to 97, a 15.5% increase from 84 in 2017. This is further proof that more businesses and institutions are now understanding the impact of their operations on the environment, and this realization prompts them to explore different options in terms of smarter energy choices.
Given EDC’s leadership and longevity in the industry, it has the capability to support companies as they develop smart energy strategies. This greatly reduce the negative environmental impacts of their industrial and/or commercial operations, without sacrificing efficiency and productivity. A prime example would be EDC’s partnership with Continental Temic Electronics Philippines, a global automotive parts company. In 2018,Continental Temic contracted EDC to supply its facilities in Calamba, Laguna with renewable energy. Continental Temic’s agreement with EDC is for 2.7 megawatts (MW) of geothermal power for a period of two years. “We chose EDC for its 100% renewable energy and for its sustainability programs, which are aligned with our company values,” said Glenn Everett, General Manager of Continental Temic.
But it isn’t just newcomers making the switch to renewable energy. Long-term partnerships and returning customers provide a stronger case for the effectivity and reliability of renewable energy.
General Milling Corporation (GMC), a leading integrated food manufacturing company, renewed its contract with First Gen Corporation (First Gen), the parent company of EDC. Under this new contract, First Gen, through EDC, will provide GMC’s facility in Lapu-Lapu City, Cebu with renewable energy. Beyond the benefits of clean energy, clients like GMC renew their contracts with EDC due to the high quality of service the company provides. “We chose to renew with First Gen and EDC because, aside from the pure renewable energy that they provide, we are very satisfied with their service. It is just like a renewal of vows for us,” said Joselito “Toto” Parco, Executive Vice President at GMC.
The De La Salle Health Science Institute (HSI), an academic institution, also renewed its contract with EDC to follow through with the next phase of its green initiative, which entails implementing energy solutions based on the results of an energy audit it conducted with EDC.
De La Salle Dasmarinas, another academic institution, installed a solar power system in various buildings inside its campus. The switch to solar energy helped the school realize a 4% reduction in energy consumption and in demand charges from the distribution utility.
These new and renewed partnerships validate that more companies are making the switch to renewable energy as a smart energy solution that strengthens business operations without sacrificing the welfare of the environment.
Our 2018 Sustainability Report
Our Performance Report tells the story of our efforts to achieve our business objectives, hand-in-hand with our sustainability aspirations.