The recent gas business sale between Razon-led Prime Infrastructure Capital Inc. (Prime Infra) and Lopez-led First Gen Corp. (FGen) has created the country’s largest renewable energy (RE) player, even as antitrust watchdog Philippine Competition Commission (PCC) assured that it won’t stifle fair competition in the domestic energy market.

In a statement on Wednesday, Dec. 3, PCC said that while Prime Infra has a major hold on FGen’s gas projects, this will also make them the country’s largest companies involved in the RE space. This is because both firms are engaged in renewables, especially as FGen is ramping up its geothermal, hydropower, wind, and solar developments.

Currently, FGen has about 3,668 megawatts (MW) of capacity, while Prime Infra’s parent entity, Razon & Co. Inc., holds a 45-percent interest in the Service Contract (SC) 38 consortium, which is responsible for Malampaya gas field.

Malampaya gas project is managed by Prime Energy Resources Development B.V. and Prime Oil and Gas Inc.

“In the RE generation market, the parties will become the largest firm post-transaction, but only by a minimal margin, with the market remaining unconcentrated and subject to competitive constraints from numerous existing and prospective players,” PCC said.

As such, PCC’s mergers and acquisitions (M&As) office said that the gas asset deal is unlikely to result in any substantial lessening of competition.

“In the vertical markets, the Commission found no ability or incentive for the parties to engage in foreclosure strategies,” it added.

To recall, Prime Infra acquired 60-percent ownership of FGen’s gas assets, namely the 1,000-megawatt (MW) Sta. Rita power plant, 500-MW San Lorenzo plant, 450-MW San Gabriel plant, 97-MW Avion plant, and 1,200-MW Sta. Maria power plant.

It will also hold a 60-percent stake in the offshore liquefied natural gas (LNG) terminals in Batangas province.

FGen will still retain 40-percent ownership in this deal.

On the other hand, PCC observed that FGen and Prime Infra’s share in the retail electricity supply (RES) market remains significantly below the major RES players. This is because end-users are switching to multiple licensed suppliers.

Last month, Prime Infra introduced its new subsidiary, Prime CoreGen, which will manage the newly acquired gas assets.

Manila Water Co., which is also part of the Razon group of companies, will turn over its current president and chief executive officer (CEO), Jose Victor Emmanuel de Dios, to Prime Infra’s gas arm.