Power retailer Manila Electric Co. (Meralco) and Sual Power Inc. (SPI) are seeking Energy Regulatory Commission (ERC) approval for a one-year emergency power supply agreement (EPSA) involving 200 megawatts of baseload capacity. This follows a competitive selection process (CSP).
Meralco senior vice president and head of regulatory management office Jose Ronald Valles said SPI replaced ACEN Corp., which stopped supplying Meralco with 200 megawatts of baseload capacity Nov. 2, 2024. The supply was under a power supply agreement signed Sept. 30, 2019.
Valles said ACEN terminated its contract with Meralco, citing high fuel prices, similar to reasons given by San Miguel Corp.
ACEN issued a termination notice to Meralco, citing financial losses due to the CIC breaching indicated threshold levels that allow a power supplier to cut losses and terminate the PSA.
“Considering the resulting deficit of baseload capacity, and approaching peak demand during summer months, Meralco notified the ERC of its need to enter into an EPSA while it revisits its Power Supply Procurement Plan to determine the need to conduct CSP for the remaining term of the terminated PSA,” Valles said.
He said Meralco requested proposals from six power suppliers, with SPI offering the lowest price at P5.15 per kilowatt-hour.
SPI, a San Miguel subsidiary, owns and operates the 1,294.040-MW Sual coal-fired thermal power plant in Barangay Pangascasan, Sual, Pangasinan.
Meralco said SPI’s delivered rate of P5.15 per kWh (excluding VAT and including line rental) is about P2.2281 per kWh lower than the effective cost of P7.3781 per kWh if the equivalent capacity under the Meralco-SPI EPSA were sourced from the Wholesale Electricity Spot Market (WESM).
The company said Meralco’s average blended generation rate will be reduced by about P0.1012 pesos per kWh, resulting in consumer savings of about P3.882 billion through the Meralco-SPI EPSA.
“The term of the contract is Jan. 26, 2025, until Jan. 25, 2026. This is a guaranteed supply without any outage allowance. Parties already implemented the EPSA due to the urgency, starting Jan. 26, 2025, and the application is currently undergoing pre-filing with the ERC,” Valles said.