The Aboitiz Group, through its holding company Aboitiz Equity Ventures (AEV), conducted its 2020 Coal Scenarios study with the main goal to identify future scenarios and their impact on coal investments in order to provide comprehensive guidance to AboitizPower as it rolls out its 10-year investment program.
Initially approved in December 2019, the Power SBU’s strategy includes, among other things, the construction of a baseload plant. However, the Aboitiz & Company Board recommended a review of the plans against the Group’s environmental, social, and governance (ESG) approach and their potential impact on markets and regulation, as well as on the value of the capital invested for existing and prospective plants.
Leading the study was AEV’s Corporate Strategy Team (CST) who developed the main framework for the study, leading the synthesis, facilitating discussions, and taking charge of the messaging to senior management and the Board — allowing the different team members within the project to focus solely on their respective requirements alongside their day-to-day responsibilities.
With AEV Chief Strategy Officer, Chris Beshouri, and AboitizPower President and CEO, Manny Rubio as project leads, AEV CST coordinated with the different business units within AboitizPower alongside other key leaders to ensure that the project received support from all relevant areas of expertise.
Building on the previous 2018 Coal Scenarios study, AEV CST broadened the framework to incorporate the shaping force of non-state actors or markets – especially financial markets – on investment decisions. Combining state forces, or policy- or government-led impact on future outcomes, they were able to create future scenarios that captured pertinent risks to coal investments and existing coal assets.
Perhaps unique to the facilitation of this study is in how it was accomplished almost entirely through digital collaboration. While initial work commenced in February 2020, the COVID-19 pandemic and subsequent lockdowns, the team had to act quickly to take the virtual collaboration route.
Through their dedication and innovation, the project team accomplished the 2020 Coal Scenarios study on schedule, with its key findings poised to guide AboitizPower’s strategy for thermal generation over the next 10 years.
With its structured analyses and a well-developed fact base, the AboitizPower reached conclusions relating to investments in greenfield and brownfield coal as well as gas. Furthermore, this study is also notable for stimulating rich conversations on batteries, carbon price, and other topics relevant towards formulating and continuously shaping AboitizPower’s strategy moving forward. The study also allowed for the generation of insights to help the Group assess the market and formulate the necessary actions for future public auctions and selection processes.
