Manila Electric Co. (Meralco) warned that power generation investments in the Philippines could stall over regulatory delays in approving the competitive selection process (CSP) for about 1,950 megawatts (MW) of power supply requirements.
Meralco senior vice-president and head of regulatory management Jose Ronald Valles said three CSPs are pending approval with the Department of Energy (DOE) and the Philippine Competition Commission (PCC). The one-year delay in these approvals is expected to push back the commercial operations dates for new plants by at least a year, he said.
“We’re sending the message to investors to please invest in the Philippines. We’re opening up opportunity for you to invest in generation through the CSP. But with the delay, the entry of investments is also delayed,” Valles said.
The DOE is awaiting the results of a PCC review before it can issue a certificate of conformity for 450 MW of mid-merit capacity and 600 MW of baseload capacity.
The mid-merit capacity was intended for supply starting in early 2028 and 2029, while the 600 MW baseload was targeted for February 2028. Meralco is also planning a 900 MW baseload CSP for 2030 under a 15-year contract.
Valles said that because the three CSPs were originally slated for conclusion last year, the company may need to revise its power supply procurement plan.
“I’m still waiting for the DOE approval… and my concern right now is because of the delay and the timing of the filing of our revised power supply procurement plan, there might be some changes already,” he said.
To manage potential shortages, Meralco has extended its contract with the First Gas-Sta. Rita power plant through June. Valles indicated that if more capacity is required, the company may explore emergency power supply agreements.
The utility also expects an Energy Regulatory Commission (ERC) decision by July on its first regulatory year application. Meralco is also seeking a ruling on P8 billion to P9 billion in under- and over-recoveries from January 2020 to December 2022, covering costs for generation, transmission, system loss and subsidies.
“We’re hoping the ERC will soon decide on that. Those costs have already been paid to the generators, transmission provider and the government,” Valles said.
