Manila Electric Co. has signed a supply agreement with Solar Philippines Tarlac Corp. for up to 85 megawatts of power supplied from the latter’s Tarlac solar facility at P2.99 per kilowatt-hour.
The country’s biggest electricity retailer disclosed to the Philippine Stock Exchange on Monday it opted for the agreement in support of renewable energy after the conduct of a competitive selection process.
“Meralco has executed a power supply agreement with Solar Philippines Tarlac Corp. for the sale and purchase of solar power at a headline rate of P2.9999 per kWh from the solar power plant it is currently constructing in Concepcion, Tarlac,” it said.
“This rate is significantly lower than the prevailing solar feed-in tariff rates and a welcome development for consumers,” Meralco added.
Solar Philippines Tarlac has committed to supply the electricity energy generated by its solar power plant corresponding to 75 MW and up to 85 MW from the first to five contract years and 85 MW from the sixth to 20th contract years.
Meralco said the agreement would be effective after approval of the Energy Regulatory Commission.
“Both parties are committed to file the ERC application for approval of the PSA on or before October 20, 2017 and secure the ERC’s issuance of a provisional authority, in time for an implementation of the PSA by January 2018,” it said.
Solar Philippines Tarlac won the contract after rival Citicore Power Inc. failed to challenge its P2.99 per kilowatt-hour bid.
“Our offer to Meralco is P2.99 per kWh. The price that we had offered [is] to show in good faith that this can be the standard price for 5,000 megawatts of solar that can replace the current pipeline of new fossil fuel power plants,” Solar Philippines president Leandro Leviste said earlier.
Meralco published on June 28 an invitation to bid to participate in a competitive selection process to supply 85 MW and challenge the price offer of Citicore.
Citicore offered to supply 75 MW to 85 MW of capacity from its three solar plants, namely Next Generation Power Technology Corp. in Mariveles, Bataan, First Toledo Solar Energy Corp. in Toledo, Cebu, and Silay Solar Power Inc. in Silay, Negros Occidental.
Meralco is required to publish an invitation for a price challenge under the competitive selection process rules of the Energy Department and the Energy Regulatory Commission.
Solar Philippines was the lone challenger on the bid submission deadline of August 14.