CHAPTER ONE

INTRODUCTION

Aboitiz Power Corporation

Electricity is a monopolistic product, an individual or a unit cannot live without it. Based
on studies, electricity remains as the most common source of energy used by
households in the Philippines. At home, electricity is used for lighting rooms, working
home appliances like televisions, fans and more. Today a vast number of modern
means of transportation like the electric train, aeroplanes, and electrical cars are
running on electricity. In factories, large machines are worked with the help of electricity.
Modern equipment like computers and robots has also been developed because of
electricity. Essential items like food, cloth, paper and many other things are the product
of electricity.

Aboitiz Power Corporation is an electricity generator, distributor and retail electricity

supplier type of company. Aboitiz Power Corporation belongs in the Electric Power
Industry. Consumers need electricity to survive the modern day age. Aboitiz Power
Corporation serves a huge role in the industry having to invest in 3 segmentations of the
Electric Power Industry.

A. Basic Information of the Company and Its Business (Product and Services)

A1. Name of the Company

Aboitiz Power Corporation

 A2. Nature of the Business/ Explanation in Choosing this Company

The line of business Aboitiz Power Corporation has 3 types of businesses; Power
Generation, Power Distributor and also a Retail Electric Supplier. Aboitiz Power
generates and creates electricity in different power plants using Hydroelectric, Coal, Oil,
Geothermal, Biomass & Solar power. All of these have different power plants spread
throughout the country. Aboitiz Power Corporation generates power but they also
distribute it to customers.

Coal-Fired Power Plants Geothermal Power Plants Infrared Thermography

Large Hydro Supplier Power Distribution Vibration Analysis

Run-of-river Hydroelectric Solar Photovoltaic Power Quality Analysis

Power Plant Power Plant
 A3. Location of the Head Office of the Company

Aboitiz Power Corporation’s headquarters is located in NAC Tower, 32nd Street,

Bonifacio Global City 1634 Taguig City, Metro Manila, Philippines.

A4. Rationale in Choosing the Company

The power industry in the world established the fact that economic and energy
development are correlated. The power industry has a very huge impact on the
economy of a country, because it keeps it alive for when we don’t have electricity work
cannot be done and rotation of products will not happen as well. Power companies has
the capability to become on the top with a right strategy and investment, it is up to the
company how they want to contribute on the power industry and what are the strategies
they will use. Analyzing the competitors of Aboitiz Power Corporation, Majority of them
are well known and top in the market. Aboitiz Power Corporation is also considered an
A-class power company and the goal is to move in the ladder and be more known, high
revenue, be on the top and focus on the customer journey.
B. Basic Historical Background of the Company

Although the Aboitiz Power was incorporated in 1998, the Aboitiz Group’s involvement
in the power sector goes all the way back to around 1918 with the Aboitiz family owning
around a 20% equity stake in the Visayan Electric Company (VECO). During the
company’s start, Aboitiz Power strengthens its stability by acquiring different power
companies such as Ormoc Electric Light Company and Jolo Power Company. Today,
Aboitiz Power currently owns, operates or manages various generation plants,
distribution utilities and retail electricity suppliers in the Philippines.

C. Affiliation of the Company

Aboitiz Power is the holding company for the Aboitiz Group’s investments in power
generation, distribution, and retail electricity services. As of 2018, Aboitiz Equity
Ventures (AEV), the family's publicly listed holding company, currently owns 76.88% of
the outstanding capital stock of Aboitiz Power.

D. Response to Globalization

The operations of Aboitiz Power and its Subsidiaries and Affiliates are based only in the
Philippines. With investments in power generation, retail electricity supply, and power
distribution throughout the Philippines, Aboitiz Power is considered one of the leading
Filipino-owned companies in the power industry.

E. Environmental Sustainability

Since the start of its operations, Aboitiz Power believes in the power of balance. Aboitiz
Power’s mission is to provide energy solutions that are reliable, reasonable and
responsible. As a renewable energy developer, the company believes in producing
clean energy for sustainable development and inclusive growth of its host communities
within a shared environment. The company believes that greater emphasis should be
placed on providing adequate, reliable and reasonably priced energy through innovative
and renewable energy technologies such as hydroelectric and geothermal due to the
growing concerns on the environmental impact of power generation using traditional
fossil fuel energy sources.
F. Asset, Revenue Size and Profit

As shown on the table below, an increase trend happened for the years 2016-2018 due
to the increase in the power demand in the Philippines particularly within the provincial
areas where Aboitiz Power has the largest market.

Table 1.1: A chart of Aboitiz Power’s Total Assets, Revenue, and Net Income for the
year 2016, 2017 and 2018;

Year 2018 Year 2017 Year 2016

Total P389,662 P361,477 P356,891
Assets
Revenue P159,858 P144,021 P107,884
Net Income P131,572 P119,391 P89,163
Note: Values are in Million Pesos.

G. Major Markets Served

Aboitiz Power Corporation is already at its peak at the Visayas grid. However in order to
reach the full potential of its assets and investments, Aboitiz Power’s future projects
aims to focus on the penetrating the Luzon Grid due to the fact that the top 1 of the 3
grids in the Philippines is the Luzon Grid which are the home of commercial, residential
and industrial places.