MGen Renewable Energy Inc. (MGreen), the renewable energy investment arm of Manila Electric Company (Meralco) ,will be queueing up to P200 billion worth of investments for the gigantic 3,500-megawatt solar farm development that shall be integrated with 4,000-megawatt hours (MWh) of energy storage system.

According to Meralco Chairman Manuel V. Pangilinan, that is the aggregate capital outlay to be funneled into the solar project once acquisition of the majority shares of SP New Energy Corporation (SPNEC), a subsidiary of Solar Philippines Power Project Holdings Inc. (SPH), will finally be concretized.

The deal with Leviste-led SPNEC, Pangilinan said, is targeted for completion and closing before the end of this year.

“In terms of what our aim is, to close certainly — we’re hoping that it be done by end of this year because they should be able to energize some time first quarter in 2026, the first 600 megawatts should happen very quickly,” Pangilinan stressed.

Meralco emphasized the facility shall be developed in phases under Terra Solar corporate vehicle – and at its commercial operation stage, the project will provide all renewables mid-merit capacity to the utility firm at the magnitude of 850 megawatts.

“It’s exciting. It’s a big project. It attracted a lot of interest from foreign investors because it’s big. It’s transformative actually for the Philippines,” Pangilinan highlighted.

He further noted that when it comes to preparatory bits for the mammoth solar installation, roughly 50% of the required land acquisition for the multi-phased project had already been secured by SPNEC.

At transaction close, MGreen’s common and preferred voting shares will account for the controlling stake of 50.5% in SPNEC.

The equity acquisition entails capital injection of P15.9 billion that MGreen will have to carry out through subscription of 15.7 billion common shares and 19.4 billion of redeemable voting preferred shares of SPNEC.

The utility firm added that, upon the agreement of Solar Philippines, MGreen will be using SPNEC “as the primary vehicle to develop 3,500 megawatts of solar panels and 4,000MWh of battery energy storage systems in Luzon.”

The 20-year power supply agreement (PSA) for the Terra Solar project has already been approved by the Energy Regulatory Commission (ERC) based on a ruling it rendered on August 8 this year.

As culled from that regulatory approval, Terra Solar was directed to submit several permits underpinning its project implementation – including certificate of endorsement from the Department of Energy (DOE); environmental clearance certificate (ECC) from the Department of Environment and Natural Resources (DENR) as well as certificate of registration from the Board of Investments.

Further, the project corporate vehicle was directed to submit final loan agreement with PNB Capital within 15 days from execution, or it shall come not later than the longstop date of February 16, 2024.