By Keith Richard D. Mariano

May 27, 2016 - San Miguel Corp. (SMC) prefers to invest in clean coal-fired power plants over renewable energy projects for now, as the latter would pass heavier cost burden to consumers, its top official said.

SMC President and Chief Operating Officer Ramon S. Ang, in an interview with reporters on Thursday, said the conglomerate will adopt clean technology in its power generation business.

“We are very much aware that a coal power plant is very harmful to the environment,” Mr. Ang said in a mix of English and Filipino. “Although renewable energy is the most ideal. It is not sustainable... because it imposes too much burden on the part of the end-users.”

The conglomerate, through its subsidiary SMC Global Power Holdings, will instead invest in fluidized bed coal-fired power generating facilities, which emit substantially less greenhouse gases.

In an earlier interview, Mr. Ang said the company plans to build two power plants in Luzon and three in Mindanao with aggregate capacity of 1,200 megawatts for around $4.2 billion.

In Luzon, SMC plans to build and operate four 150-MW circulating fluidized bed coal-fired power generating facility in Pagbilao, Quezon. It will build another plant with the same specifications in Mariveles, Bataan.

“We hope to build more capacity,” Mr. Ang said.

Mr. Ang noted that households would spend P9 for every killowatt hour (kWh) of renewable energy consumption, about three times the P3/kWh rate charged for supply coming from clean coal-fired plants.

A clean coal-fired power plant would entail an investment of about $2 million per megawatt, twice the $1-million investment needed for an ordinary coal-fired plant, the SMC official added.

Still, clean coal would cost less than renewable energy. For instance, the Lopez-led First Philippine Holdings, Inc. (FPH) incurred a cost of $3 million per megawatt for its wind power plant in Burgos, Ilocos Norte.

FPH earlier said it will never invest in coal-fired power plants. In addition, the Lopez-led conglomerate is outlining roadmaps for non-energy businesses to source their power supply requirements from clean producers. 

Aside from expanding its energy business, SMC is looking into “a few” acquisitions and more investments in other segments, Mr. Ang told reporters.

Also on Thursday, the conglomerate’s subsidiary Ginebra San Miguel, Inc. reported the fastest growth in market share among major liquor players in the Philippines last year.

Ginebra San Miguel cited the annual Retail Audit of market research firm Nielsen, wherein the company’s market share was pegged at nearly 30%. This reflects the 5% and 12% volume growth of its flagship brand Ginebra San Miguel and heritage brand Vino Kulafu, respectively. 

The company attributed its improved performance to positive consumer response to its “Ganado Sa Buhay” campaign for Ginebra San Miguel, and trade and consumer activities for Vino Kulafu.

In the first quarter of the year, Ginebra San Miguel swung to a net income of P36.1 million from the net loss of P14.3 million recorded for the same period in 2015. 

Ginebra San Miguel doubled its operating income to P188 million from a year earlier. Its consolidated revenues reached P3.9 billion, a 7% increase driven by stronger volumes. 

“We’re confident that the company will sustain its gains for the rest of the year with relevant marketing initiatives that will resonate across consumer segments,” Ginebra San Miguel President Bernie Marquez said in a statement.

Shares in Ginebra San Miguel were down 3.85% to P12.50 a piece on Thursday. Its parent, meanwhile, climbed 0.54% to P73.80.