EDC 2014 SR (UPDATED)

EDC 2014 Performance Report
On November 12, 2014, EBWPC received the DOE’s Certificate of Endorsement (COE) for FIT
eligibility under docket number COE-FIT No. W-2014-11-002 endorsing the 150-MW Burgos
Wind Project for the purpose of qualifying under the Feed-In Tariff (FIT) System.
Total revenue recognized by the Burgos Wind Energy Project from November 11, 2014 to
December 31, 2014 amounted to ₱188.3 million.
Upon completion of the Burgos Wind Project, the Company transferred a total cost of
₱16,241.2 million from the “Construction in Progress” account to completed property, plant and
equipment under the “Power Plants” account. For the period from November 11, 2014 to
December 31, 2014, the depreciation expense recognized on the completed assets of Burgos Wind
Project amounted to ₱133.1 million while the total revenue generated amounted to ₱188.3 million.
Completion of the Northern Negros Geothermal Plant to Nasulo Geothermal Plant (N2N) Project
In April 2011, EDC suspended the operations of its 49-MW Northern Negros Geothermal Plants
(NNGP) because the plant was not capable of operating on its designed capacity due to steam
supply limitations. In the last quarter of 2013, to utilize the facilities and fixed assets of NNGP,
EDC transferred the components of the power plant of NNGP to Nasulo Power Plant which will
be constructed site in Southern Negros. The N2N Project was implemented in two phases.
Phase 1 covered the site preparation and civil works, including the construction of the powerhouse
building and other civil structures and foundations while Phase 2 covered the relocation of the
existing unit and electro-mechanical equipment from NNGP going to Nasulo.
On July 21, 2014, the Company declared that the Nasulo Power Plant achieving a capacity of
49.4-MW was already complete and in the condition necessary for it to operate as intended by
management. Upon completion of the Nasulo Power Plant, the adjacent Nasuji Power Plant with
capacity of 20 MW has been placed on preservation mode.
During the relocation and construction of the Nasulo Power Plant, the Company incurred general
borrowings used to fund the project. In 2014, the borrowing costs capitalized in connection with
the project amounted to ₱14.4 million using capitalization rate of 6.3% per annum.
The Company performed testing run from April 2014 to July 20, 2014. The total revenue
generated from testing amounted to ₱343.5 million. Out of this amount ₱99.8 million was offset
against the costs of testing whether the assets are functioning properly.
The total costs capitalized for the construction of the Nasulo Power Plant amounted to
₱4,107.7 million, including assets came from NNGP. From July 21, 2014 to December 31, 2014,
the related depreciation expense recognized for the Nasulo Power Plant amounted to ₱65.9 million.
Transfer of certain NNGP assets to Palinpinon Power Plant
In February 2012, EDC transferred certain vacuum pumps previously used and located in NNGP to
Palinpinon Power Plant located in Southern Negros and owned by GCGI. Since these transferred assets
(which had been previously impaired in NNGP) can now be utilized and were included in the cashgenerating
unit of the Palinpinon Power Plant, the Company recognized a corresponding reversal of
impairment loss amounting to ₱63.6 million, representing the net book value of the assets transferred had
no impairment loss been previously recognized. The reversal of impairment was recognized under NIGBU
operating segment.
Completion of the Rehabilitation of Bac-Man Geothermal Power Plants (BMGPP)
On May 5, 2010, BGI acquired the 150 MW BMGPP in an auction conducted by PSALM where
BGI submitted the highest offer price of US$28.3 million.
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