MANILA ELECTRIC Co. (Meralco) is seeking “a quick resolution” by regulators of any issues involving the procurement of its 1,800-megawatt (MW) capacity requirement.
Joe R. Zaldarriaga, spokesperson and vice-president for corporate communication of Meralco, said the power distributor “will immediately” ask the bids and awards committee to start the competitive selection process (CSP), the mandated transparent bidding for power supply.
“After the CSP, the resulting PSA (power supply agreement) will be filed for approval before the regulator and we hope for a quick resolution of any petition to be filed,” he said in a Viber message.
Meralco said it had submitted for approval the new terms of reference (TOR) to the Department of Energy (DoE) on Sept. 14 for the conduct of CSP to replace the capacity covered under terminated contracts.
“[The 1,800 MW supply is] very crucial as it will ensure that our supply requirements will be able to meet the growing demand of our customers,” Mr. Zaldarriaga said.
Energy Undersecretary Rowena Cristina L. Guevara confirmed that the DoE had received the proposed new terms from Meralco.
“However, the responsibility to review the TOR rests with the ERC (Energy Regulatory Commission) in accordance with the CSP guidelines,” she said in a Viber message.
In the meantime, the DoE has advised Meralco to submit for review and evaluation its updated power supply procurement plan to include the 1,800 MW granted by the ERC for withdrawal or termination, Ms. Guevara said.
Last week, ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta said the regulator had approved the withdrawal of the PSA application jointly filed by Meralco and San Miguel Corp.
The two companies under San Miguel’s power arm San Miguel Global Power Holdings Corp. — Excellent Energy Resources, Inc. and Masinloc Power Partners Co. Ltd. (MPPCL) — were supposed to start delivering Meralco’s needed capacity by 2024 and 2025 after bagging the supply contracts in 2021.
Excellent Energy had proposed to supply 1,200 MW from its natural gas power plant for P4.1462 per kilowatt-hour (kWh) by 2024, while MPPCL had offered to provide the remaining 600 MW from its coal-fired power plant for P4.2605 per kWh by 2025.
In March, Meralco said that SMC submitted the notices of termination of the PSAs.
Ms. Dimalanta said the PSA withdrawal had been approved as the long stop date — or the agreed time frame during which all conditions required for a transaction must be completed — had lapsed.
She said Meralco now needs to comply with the new CSP guidelines issued on Oct. 6, which is anchored on the policy framework issued by the DoE in June.
With the new guidelines, Ms. Dimalanta said the bidding process and rates are all subject to ERC guidelines, making it easier for distribution utilities (DUs) to comply “because they just look at the ERC rules to follow for CSP.”
“We also provided PSA templates to guide DUs and facilitate the review at ERC level (since in a way, we already pre-cleared those terms and conditions),” she said, describing the process as “streamlined” and the evaluation “transparent.”
Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.
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