Power retailer Manila Electric Co. expects to conduct a competitive selection process for 1,800 megawatts of baseload capacity upon approval by the Energy Regulatory Commission.
Meralco head of regulatory management office Jose Ronald Valles said they were waiting for the ERC resolution on the termination of the power supply agreement with Excellent Energy Resources Inc. and Masinloc Power Partners Co. Ltd.
“If the termination is granted, we shall immediately conduct a CSP for the 1800-MW capacity, and we are hoping to conclude this process in the shortest time possible, since the scheduled commercial operations date for at least 1,200MW will start in December 2024 already,” Valles said.
ERC chairperson Monalisa Dimalanta said the commission asked Meralco to submit additional information on the PSA and would have to check its compliance.
The ERC also directed Meralco and the two companies to refrain from implementing any termination of the 2021 PSA until the regulator acted on the appropriate pleading filed by the applicants.
“The conduct of this CSP will depend on the timing of the ERC resolution which we hope to receive soon. This is our priority at the moment considering the urgency,” Valles said.
San Miguel Global Power Holdings Corp., the power arm of conglomerate San Miguel Corp. decided to terminate its PSAs with Meralco totaling 1,800 MW for delivery starting 2024 and 2025 due to ERC’s non-issuance of the final approvals within the respective long stop dates in September 2021.
EERI offered to supply Meralco with 1,200 MW from a natural gas-fired power plant starting 2024, while MPPCL offered 600 MW from a coal-fired power plant starting 2025.
EERI and MPPCL offered the best bids for Meralco’s 20-year 1,800 MW supply contract in February 2019 among the six qualified offers it received.
EERI offered a levelized cost of electricity of P4.1462 per kilowatt hour, while MPPCL offered P4.2605 per kWh. Both were below the LCOE reserve price of P5.2559 per kWh.
Meralco earlier said the PSA termination would not have an impact on supply yet, given it was targeted to be delivered by 2024 and 2025, but underscored the need to conduct a new CSP to ensure the security of supply in the coming years.
