Cusi urges Meralco to comply with SC order on bidding

Energy Secretary Alfonso Cusi urged power retailer Manila Electric Co. to soon comply with the ruling of the Supreme Court ordering energy companies to undergo a competitive selection process for power supply agreements.

“For Meralco, they have to do it fast. Don’t waste time… Do it now,” Cusi said at the sidelines of the groundbreaking of the FGen LNG Corp.’s liquefied natural gas terminal project in Batangas City.

Meralco signed power supply agreements with seven generators in April 2016 to secure 3,551 megawatts of capacity needed in its franchise area, which became the subject of the Supreme Court case.

The SC ruled that all PSA submitted by distribution utilities to the Energy Regulatory Commission on or after June 30, 2015 should undergo a competitive selection process, a form of competitive public bidding for the purchase of electricity by DUs.

The decision was in connection with the case filed by the Alyansa Para Sa Bagong Pilipinas.

“For CSP, of course the decision of the Supreme Court is very clear.  We just have to follow it to the letter,” Cusi said.

Cusi said that if the power players would not comply with the ruling, the Energy Department would step in.

“When I said that, it could be that the government will [be] the single buyer that we are going to auction it and then distribute it,” he said.

Meralco expressed willingness to comply with the Supreme Court ruling.

“We have to follow the decision of the Supreme Court. I think ERC…they provide us the generators the terms of reference of the CSP,” Meralco chairman Manuel Pangilinan said earlier.

He said Meralco would no longer appeal the decision as the case had dragged on for a long time. 

“We wasted a number of years… It’s time to decide. We’ll just accept it,” Pangilinan said.

Cusi earlier said the Energy Department could now move on to the extremely urgent tasks at hand, “particularly putting new power projects back on track to help augment the country’s power supply for 2020 to 2022.” 

“The DoE will continue to push for the conduct of the CSP. This would ensure the transparency in the signing of power supply contracts, and more importantly, ensure that they will be at least cost for the benefit of our consumers,” Cusi said.

The energy chief said he was hopeful that the SC ruling would usher in a new era in power procurement, “an era of true competition, where all deserving power suppliers with efficient technologies, low rates and fair contract terms are welcomed into the market.”

“These recent developments would help us evaluate how we could facilitate bringing in new capacities into the grid. We would also be keeping an eye out for those projects which could be completed faster and conduct a quick CSP to help fast track the process,” Cusi said.