Tongonan-1 Geothermal Power Plant in Leyte, one of EDC’s oldest power plant facilities, has been supplying power to the Luzon and Visayas grid for almost 40 years“2020 is a year wherein I cannot reasonably complain about the performance of the company,” Energy Development Corporation (EDC) president and chief operating officer Richard Tantoco said in the company’s 2020 integrated report, noting a recurring net income attributable to equity holders of the parent of P9.85 billion despite a significant reduction in electricity demand.
EDC likewise disclosed a steady EBITDA (earnings before interest, taxes, depreciation and amortization) of P21.5 billion for 2020 compared to the previous year’s P22.1 billion despite the unforeseen challenges posed by the global COVID-19 pandemic.
“It was fortunate that when the crisis happened, EDC was in good financial health. Our chairman [Federico R. Lopez] has prudently directed the group companies to practice fiscal discipline and keep debt at low, manageable levels. We were able to build up and maintain our cash reserves well in advance,” noted Tantoco.
Consequently, EDC was able to invest in new projects in anticipation of post-COVID business resurgence, such as the 29- megawatt (MW) Palayan Bayan in its Bacon-Manito geothermal site in Bicol, the 3.6-MW Mindanao 3 binary plants in its Mount Apo geothermal field, the 100-MW Aya hydro project in Nueva Ecija, and the 20-MW Tanawon geothermal plant also in Bicol later in the year.
Financial performance of the company is now merely one of six aspects of operations that EDC measures as part of its shift to the International Integrated Reporting Council’s integrated reporting (IR) framework, in line with a Lopez Group-wide initiative last year toward a renewed mission of “forging collaborative pathways for a decarbonized and regenerative future.”
“Over four decades of practicing sustainability has made us realize that it is not nearly enough. We should shift to regenerative thinking that calls for us to look beyond profitability and doing less harm. We commit to go beyond sustainability by being regenerative as we elevate everything we touch—the environment, our communities, employees, cocreators and partners, and our customers,” stated Tantoco.
“Our shift to integrated reporting demonstrates our holistic approach to our business— one that carefully considers the capitals at our disposal, and the strategies through which we can manage, develop and transform these capitals to continue creating and sharing value with our different stakeholders,” he added.
EDC’s IR for 2020 detailed the company’s strategy, governance and management of six capitals: financial capital, manufactured capital, human capital, social and relationship capital, intellectual capital and natural capital.
Among many achievements in line with these capitals, EDC reported a total of 9,111.8 gigawatt-hours of generation volume sold in 2020 across its geothermal, wind, solar and hydro operations, which enabled the company to help the country avoid over 7 million tonnes of carbon dioxide equivalent in lieu of coal.
In terms of intellectual capital or knowledge-based assets, the company undertook a massive digital transformation that included technologies such as data intelligence led by its sub-surface geothermal resource group, as well as an enterprise asset management solution from IBM.
Natural capital is intrinsic to EDC with geothermal energy production as its biggest operations. In 2020, the company retained its carbon intensity of 0.1 tonne of equivalent carbon dioxide per megawatt-hour. Its flagship corporate social responsibility (CSR) program BINHI continued its national regreening initiative, thus far restoring 9,570 hectares of forests in its geothermal areas.
Human capital remained a top priority for EDC as it primarily put in place work-from-home and shelter-in-place protocols even before the start of lockdowns in 2020. Other initiatives included repatriation of stranded employees, repurposing of benefits and early disbursement of financial bonuses and aid.
In its proprietary workforce internal survey EDC Pulse Check, the organization attained a 91% engagement score through the pandemic year.
Last, in terms of social and relationship capital with its communities of operation, EDC poured a total of more than P256 million in social investments by way of its institutionalized programs in its two main CSR thrusts of education and the environment, as well as immediate public health and livelihood needs brought about by the pandemic. This is on top of the P165.2 million worth of COVID-19 assistance that the company has provided to its local government unit partners. (Story/Photos by: Frances Ariola)