Rappler’s @RalfRivas talks to 28-year-old Leandro Leviste about Solar Philippines Nueva Ecija Corporation's IPO and his vision for the country's energy sector.
WATCH #BusinessSense:
WATCH #BusinessSense:
Leviste: I started Solar Philippines 8 years ago when I was 20 years old. At the time there was very little solar installed in the Philippines.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: We needed to convince the incumbents that there was potential in solar energy. We’re definitely glad that solar has now grown to where it is today, but still think there’s a long way ahead.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: There’s a great benefit to starting young so that you can also have more time to compound the value of the company, and make mistakes and recover from them.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: Second, finding the next big thing that the incumbents are not yet occupying. If it’s a new thing, then even a young person can become a leader in the space.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: I studied political science in college and always thought my track would be to go to law school after graduating.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: But I was a sophomore when I started this business and then became a believer that the best way to create change is no longer through government but through the private sector.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: When I saw the likes of Elon Musk, pioneering similar business models for the installation of solar panels on rooftops through Solar City, I was inspired. You can get a lot done as a businessperson even in a short amount of time.
Leviste on SPNEC IPO: The first P1.3 billion that may be raised will primarily go to construct 100% of the first 50 MW, which will become 25% of the first 225 MW after the company is able to raise subsequent financing from debt providers.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: Amounts raised in excess of the first P1.3B will primarily go to acquiring land for the expansion of the project in excess of 500 MW.
#BusinessSense:
#BusinessSense:
Leviste: It is the aspiration of SPNEC to not only construct the Philippines’ largest solar project upon reaching 225 MW, not only Southeast Asia’s largest solar project upon constructing 500 MW, but to construct one of the world’s largest solar projects.
Solar PH’s Leviste: For solar to really become a very large share of the Philippine energy mix, we’ll need to build a lot of capacity. We’re coming from just 2% or 3% right now.
#BusinessSense:
#BusinessSense:
Leviste: It is in the best interest of shareholders to make use of the proceeds of this IPO to hopefully construct the full 500 MW, without needing to raise further equity, but trying to maximize debt after the IPO as much as possible.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: We’d like to begin by thanking the PSE for first, coming up with these rules in 2011, trying to encourage renewable energy companies to list even development-stage projects.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: Hopefully this first listing making use of that 2011 rule will encourage others to likewise tap the capital markets to fund greenfield projects.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: We are trying to take this company from the first 50 MW to the next 225 to its eventual 500, and if the offering will have equity to support that, then the investors would be able to make a good return on their investment.
Solar PH’s Leviste: The first 50 MW should become operational in a target of 9 months from the IPO and the 225 MW a few months thereafter.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: I would emphasize the need to think of what is going to create the most value for the shareholders.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: We would like to set low expectations for dividends in the short term because management really thinks this is an industry that is poised for growth.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: It would be a disservice to the shareholders to be prioritizing distributions when we can instead be reinvesting the earnings to make this a full 500 MW and even beyond.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste: Nueva Ecija is actually closer [to Metro Manila] than our other project sites in Central Luzon. That proximity means there is potential to construct new transmission that will allow for expansion.
#BusinessSense:
#BusinessSense:
Solar PH’s Leviste on #COP26: I think it’s disappointing that world leaders are not more decisive in solving climate change. It has always been our company’s belief that it’s going to have to be the private sector that leads the way.
#BusinessSense:
#BusinessSense:
Leviste: We are in the process of trying to prove that solar will in fact be the mainstream source of energy in the Philippines and we are hopeful this will happen soon. When that happens, we will be taking Solar Philippines Power Project Holdings public.
Solar PH’s Leviste: We applaud the DOE for taking very forward-looking policies, such as mandating that 35% of the country’s energy will come from renewables by 2030. We think the industry will be able to deliver.
#BusinessSense:
#BusinessSense:
That’s a wRap! Watch the full #BusinessSense episode here:
• • •
Missing some Tweet in this thread? You can try to
force a refresh
