HSBC Philippines has issued its first sustainable commercial letter of credit (LC) to partly bankroll the 160-megawatt Balaoi and Caunayan wind farm facility of Ayala-led ACEN Corporation in Pagudpud, Ilocos Norte – which at its completion will stand as the biggest wind facility to be ever installed in the country.

“The trade facilities will provide LC capabilities to the wind project at a critical moment as they progress towards completing the Pagudpud wind farm development,” the multinational investment bank noted.

As culled from the project’s blueprint, the wind farm venture will command aggregate investment of P11.4 billion. It is targeted for completion by fourth quarter this year and due for commercial operations first quarter of 2023.

The Balaoi & Caunayan wind farm development shall be equipped with 32 turbines, and it will be ACEN’s third project of the same technology type in Ilocos Norte – somehow a mammoth follow-through to its first two wind farm installations -the Northwind facility in Bangui; and the Northern Luzon Renewables project that is also sited in Pagudpud.

According to Trish Ramos, head of HSBC Philippines Global Trade and Receivables Finance, the bank’s trade facilities “will help ensure unhampered progress in the completion of the Pagudpud wind project providing timely access to credit to secure the plant’s primary components.”

She highlighted that the funding extended for the Pagudpud wind project is very much aligned with HSBC’s stature in the capital market as purveyor of “innovative products and sustainable financing solutions.”

In HSBC’s deal for the ACEN wind farm project, Ramos indicated “we are very pleased to be playing a part in the growth of the Philippines’ emerging renewable energy sector.”

ACEN currently has more than 3,000 megawatts of attributable capacity and it is targeting to ramp up its RE installations to 5,000MW by 2025 – a goal that will cement its pathway to become the largest listed RE company in the Southeast Asian region within that timeframe.

Jose Maria Zabaleta, chief development officer of ACEN, said “we greatly value and appreciate HSBC’s support in making this project a reality,” adding that “as one of the country’s largest wind farms upon completion, it will go a long way to meet the corporate and net zero goals of all the stakeholders, and the country’s energy security targets.” At construction phase, the wind farm project will generate about 380 jobs, especially within its host community.

ACEN had cast its mid-century net zero goals in October last year, and it has synchronized that with the overall decarbonization target of the entire Ayala conglomerate.

For the wind project in Ilocos Norte, ACEN emphasized that the installation will yield 504 gigawatt-hours (GWh) of RE-generated electricity on a yearly basis and such will subsequently result in avoidance of at least 344,604 metric tons of carbon dioxide (CO2) emissions annually.

Mimi Concha, head of HSBC Philippines Wholesale Banking, conveyed that as part of HSBC’s sustainability agenda, “we have always been on the lookout to support sustainability-related projects that will accelerate us and our clients in our journey towards a ‘net zero’ economy,” and the Pagudpud wind project came on cue as an opportunity for the bank to be engaged in “delivering green project into completion.”